Huawei faces ‘impossible’ challenge after latest US tech sanctions, say analysts

[Pakistan Space Agency]

... The Chinese Brigade may scoff, but these companies operate in the real world. Bluster and hubris on PDF won’t change Huawei’s fate.

How old is this trade war now? Around 4 years old and what has really changed?

 

[F-22Raptor]

How old is this trade war now? Around 4 years old and what has really changed?

Nothing has been done at this scale. The US is cutting off Huawei from nearly every semiconductor in the world.

 

[Feng Leng]

 

[Pakistan Space Agency]

Nothing has been done at this scale. The US is cutting off Huawei from nearly every semiconductor in the world.

That's my point. We heard so.much about tariffs on $500 billion Chinese products and what not for about 3 years and all that fizzled out. Something was signed quietly and everything is still chugging along as it used to be. Did the US replace China with another nation as it's largest trading partner?

What's the outcome of this? Are Apple and Samsung going to provide more advanced phones than Huawei? Is the US going to lead in the 5G industry anytime soon? Which country has 1.4 billion customers?

All this sounds more like a loud reality tv show than anything else so far.

 

[ZY-CN-CA]

Huawei is going the way of IDM, as per Intel and Samsung. If she succeed, she will be world greatest monster big tech.

hello,what is IDM

 

[Paul2]

hello,what is IDM

Integrated device manufacturer. Having own products, and making them by itself.

 

[AZADPAKISTAN2009]

Huawei should focus on expanding in Iran /Syria
Sell 100-200 planes to IRAN/Syria

World just needs a bit of balancing act , the moment China Supplies IRAN/Syria with Fighter Jets the drama will stop

 

[khanmubashir]

Chinese already make alot of semi conductors them selves

Only issue is the most advance ones
But in few years Chinese will develop capacity to make them too
Maybe they would have to pirate some of USA patents
This will cause restrictions on their sale in west but such restrictions already imposed


But they would continue to sell to rest of world and own growing buying power 1.4 billions consumers

Besides these patents have expiry dates many already crossed half life

 

[THE MASK]

I hope Indian government ban Chinese products once for all.

BTW these Chinese tech spy are danger to world peace and should be banned.

Stay irrelevant!

 

[bolo]

I hope Indian government ban Chinese products once for all.

BTW these Chinese tech spy are danger to world peace and should be banned.

Being gangbanged by western powers many times. How far did India advance??

 

[JustAnotherPerson]

I will laugh my a** off when the Americans find out that the only thing they did was to push the Chinese semiconductor industry to the next level. The unintended consequences are starting to been see even before this new ban, Chinese companies are abandoning Qualcomm left and right and those "Experts" are greatly underestimating what is coming, once the China semiconductor industry go overdrive will plummet prices all over the world and cause a lot of pain for some of the big players in the semiconductor industry.

 

[F-22Raptor]

The global chip and smartphone industries are bracing for severe disruption after the US launched tougher sanctions against Huawei that some said could mean “death” for the company.

Washington said on Monday that no company worldwide would be allowed to sell semiconductors made using US software or equipment without a license if Huawei was involved at any stage of the transaction.

The move closed a loophole in a May version of the rule that allowed Huawei to buy off-the-shelf chips if they were not custom-made to its designs.

Observers said given the dominance of US tools in certain segments of chipmaking, the new rule amounted to a blanket ban on any chip sales to Huawei, hitting its 5G equipment and handset businesses.

“We believe this step to significantly (almost completely) curtail Huawei’s ability to source any semiconductor from anyone,” Manish Nigam, head of Asian technology research at Credit Suisse, said in a research note.

The toughened US measures come as Huawei is vying for the title of the biggest handset maker on the planet and is trying to roll out its 5G networks around the world against opposition from Washington.

“Huawei is probably finished as a maker of 5G network equipment and smartphones once its inventories run out early next year,” said Dan Wang, of Gavekal Research in a report on the sanctions titled: “A Death Sentence For Huawei.”

“This now stops [US chipmakers] Nvidia, Intel, everyone, and they were not impacted before,” said an industry expert, adding that the tighter restrictions would affect billions of dollars in business across the sector.

Zhao Lijian, a spokesman for China’s foreign ministry, said on Tuesday that the new sanctions against Huawei were “undisguised bullying” and the US was “stretching the concept of national security and abusing state power.”

Analysts said MediaTek would probably be the first victim. The Taiwanese chip design house helped spawn generations of Chinese handset makers by offering off-the-shelf chip solutions. MediaTek’s shares dropped by almost 10 per cent in early trading on Tuesday, leading an Asia-wide plunge in semiconductor stocks.

After the initial Huawei chip restrictions in May, Huawei had been planning to switch its smartphones from chips designed in-house to those from MediaTek to get around the ban.

“MediaTek will face an impact, though partially offset by its 38 percent share into other vendors,” Randy Abrams, an analyst at Credit Suisse, said in a research note. The bank downgraded the company to Neutral.

Analysts said the news would boost rival smartphone producers to Huawei.

“If Huawei cannot buy chipsets for its handsets, its handset business will probably disappear,” wrote Edison Lee at Jefferies.

He predicted that Oppo, Vivo, and Xiaomi would gain global market share. This would boost Qualcomm as the three rival Chinese brands relied more heavily on the US chip design house that competes with MediaTek.

However, some analysts said Washington’s tough move against Huawei could play out differently if Beijing hit back.

“Given such sanctions significantly impact Huawei, there could be retaliation from China,” said Sebastian Hou at CLSA. He named Apple, Huawei’s competitor in the smartphone market, and Qualcomm as potential targets.

South Korea’s computer chip manufacturers Samsung Electronics and SK Hynix, which supply memory chips to Huawei, were on Tuesday assessing the potential impact.

“Our understanding is that all chip supply, including memory chips, to Huawei will be subjected to the new US regulations,” said Sanjeev Rana, a Seoul-based tech sector analyst with CLSA. Samsung and SK Hynix declined to comment.

Analysts saw some possible upside from Huawei’s woes for Samsung’s mobile phone and 5G networks businesses. “We can expect the smartphone market to rebalance with Huawei’s market share taken up by other smartphone [companies] and hence it would be neutral to the memory chip demand,” Rana added.

Shares in Samsung edged higher in Seoul on Tuesday while SK Hynix dipped slightly.

Among Japanese companies, shares in Sony fell more than 1 per cent. Jefferies analyst Atul Goyal estimated that Huawei was Sony’s biggest customer in image sensors after Apple, accounting for about 20 percent of its image sensor operating profits and revenue.

“Sony has already reduced image sensor output and... [is] already taking into account the Huawei impact in their forecast,” Goyal said.

Longer-term, analysts expect Sony to recover some of the losses from Huawei by expanding sales to other Chinese smartphone makers, such as Vivo and Xiaomi.

https://arstechnica.com/gadgets/202...y-chain-shaken-as-huawei-faces-mortal-threat/

 

[ZeEa5KPul]

I know our oxygen-deprived friend the OP probably needs a change of shorts after reading this spam he keeps pushing, but as always I'm here to pour a bucket of cold water over his head.

These sanctions have a trivial workaround that I'll let the OP in on since he obviously won't be able to figure it out himself. Every single chip Huawei needs it'll be able to buy, only the receipt will read "Government of China" instead of "Huawei". Try imposing sanctions then...

And I assure you, the retaliation for this will come. Keep wetting your panties until November 3, because on November 4 it's an entirely new game.

 

[hirobo2]

Isn't all this silicon stuff supposed to become obsolete anyways? USA banning Huawei now is like banning CRT monitors when LED monitors r just around the corner...

 

[Nan Yang]

Nothing has been done at this scale. The US is cutting off Huawei from nearly every semiconductor in the world.

Throughout history to present, China has done a lot of impossible things.