Tech companies distance themselves from Huawei

On Thursday, Japanese tech firm Panasonic and the UK chip-designer ARM became the latest to hop on to bandwagon of a growing number of companies disassociating with  Chinese technology conglomerate Huawei. Earlier in the week, Google had announced that it would no longer continue to support the  Android operating system used on Huawei devices.

The year obviously got off to a bad start for Huawei with the US government continuing to seek the extradition from Canada on fraud charges the company’s CFO Meng Wanzhou, the daughter of founder and CEO Ren Zhengfei. Then telecommunication carriers in the US pulled out of deals to provide Huawei phones to their customers and soon tech firms were scrambling to scale  back their involvement in the 5G communications ecosystem being offered by Huawei.

At the heart of the tiff between the US and Huawei is the belief by many in the US government and in the intelligence community that the firm is just a front for intelligence gathering on behalf of the Chinese government. The company has been accused of undermining  US national security and posing cybersecurity and privacy risks for American customers.

Adding another twist to the vise to increase pressure on Huawei, the US Commerce Department has now placed the Chinese company and its affiliates on the ‘Entity List. This listing prohibits US companies, and those using technology and components from US companies, from selling technology to Huawei without prior approval from the US government.

In response to this listing many US companies have begun cutting off their association with the Chinese tech giant. Google, announced last week that it would remove Huawei from its official Android licensing program.

Huawei will now have to use the Android Open Source Project (AOSP), which would then cut the company off from critical Google apps and services that consumers outside of China expect on Android devices. That also means Huawei will only be able to push security updates for Android once they are made available in AOSP, assuming the company uses its own update system.

In a brief relief for Huawei customers, the US Commerce Department has granted a 90-day reprieve during which users will still have access to Google software updates. A Google spokesperson pointed out that “Google Play and the security protections from Google Play Protect will continue to function on existing Huawei devices.” So while existing Huawei phones around the world will not be immediately impacted by the decision, the future of updates for those phones, as well as any new phones Huawei would produce remains in question.

Microsoft, which has so far remained silent on whether it will prevent the Chinese company from obtaining Windows licenses, could soon join the chorus of companies exiting partnerships with Huawei. Being pushed out off the all-pervading Android system by Google, and potentially out of Windows by Microsoft, could be a huge blow to Huawei, the second largest mobile phone maker in the world after Samsung.

Going forward, the ban on selling American technology to Huawei could have serious implications on the Chinese firm’s future, since many of its consumer products rely on core components and technology that are sourced from US or allied manufacturers.

For instance, some of the components used in Huawei’s latest flagship smartphone the P30 Pro, include among others, US Corning glass that covers its front and back, flash storage from US tech firm Micron, and networking components from US companies that allow the phone to connect to 3G and LTE networks.

Although Huawei says it has developed an Android and Windows replacement of its own and is supposedly ready to implement it at short notice, nevertheless, the company could find it difficult to find replacements to the US components it is denied access to, and would probably struggle to get the new parts to work with its own operating system.