Hamartia Antidote
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Samsung reportedly cutting off chip sales to Huawei
New Trump administration sanctions take effect this month.
www.theverge.com
SK Hynix is also reportedly dropping Huawei
Samsung and SK Hynix will reportedly stop selling components to Huawei as the Trump administration tightens sanctions on the Chinese phone maker. According to Chosun Ilbo and other Korean news outlets, the companies will suspend trade on September 15th, the day a new set of rules limits dealing with Huawei.
These sanctions were introduced in August, following a string of other restrictions implemented since last year. They ban non-American companies from selling components that were developed with US technology unless these companies obtain special approval. This poses a serious threat to Huawei, which has said it may no longer be able to make its Kirin chipsets. Conversely, Huawei’s business is valuable to many other companies, as it recently became the top-selling smartphone manufacturer. Taiwanese chipmaker TSMC reportedly suspended sales to Huawei this May after an earlier round of restrictions. Huawei called those rules “arbitrary and pernicious.”
The Chinese government has funded a domestic semiconductor company called SMIC, which has been offered as an alternative supplier for Huawei. But the Trump administration has also threatened sanctions against SMIC, leading the Chinese Foreign Ministry to accuse the US of “blatant hegemony.” Huawei has fewer and fewer options for sourcing parts for its phones, although American chipmaker Qualcomm has reportedly lobbied the Trump administration to lift restrictions and let it sell to Huawei.
The US government argues that Huawei infrastructure poses a national security threat and that Huawei has engaged in trade secret theft and violated sanctions against Iran. It’s part of a larger trade war between China and the Trump administration — one that’s more recently focused on social media services like TikTok and WeChat. But the increasingly restrictive Huawei bans could reshape the smartphone and chip market.
