How did Huawei get through the mud under the crackdown?

“The U.S. has so many independent standards that its wireless carriers are now no one’s competitor to Huawei. On the afternoon of May 18, at Huawei’s 17th Global Analyst Conference, Huawei Chairman-in-Chief Guo Ping said in response to changes to U.S. export control rules. Fearing Huawei’s rapid growth, the U.S. has been trying to crack down on Huawei since last year, and the company is inevitably subject to some business impact, so in the long run, achieving true technological independence is not afraid of foreign repression.

How did Huawei get through the mud under the crackdown?

Have the confidence to find a solution

It is the first time in three days that Huawei has formally responded to further U.S. crackdowns. On May 15, the U.S. Commerce Department issued a statement saying that huawei’s purchases of semiconductors made from U.S. software and technology, including those outside the U.S. but on the U.S. commerce regulatory list, require U.S. government licenses before contracting Huawei and Hythes.

“Strongly opposed to the U.S. Department of Commerce’s direct product rule changes for Huawei only. Huawei said in a statement that the rule change affects not only Huawei as a company, but also a serious impact on related industries around the world. In the long run, the trust base of global cooperation between the chip and other industries will be destroyed, the conflict and losses in the industry will be further aggravated, the United States to use its own technological advantages to suppress other countries’ enterprises, will certainly weaken the confidence of other countries to use the U.S. technology elements, and ultimately hurt the United States’ own interests.

Huawei said it was conducting a full assessment of the incident and expected its business to be inevitably affected. “We will do our best to find solutions, and we hope that our customers and suppliers will work with Huawei to address the adverse effects of this discriminatory rule.” “

The statement showed that since the United States was unprovoked inclusion in the list of entities last year, in the case of a large number of industrial technology elements unsustainable access, Huawei has always abided by applicable laws and regulations, and in order to curb Huawei’s development, ignoring the concerns of enterprises and industries, no bottom line to modify industry rules, so that more than 3 billion users of information and communications affected, ignoring the rights and interests of customers and consumers. “The good news is that we are still alive. Huawei’s efforts to maintain customer supply have gained the understanding of the vast majority of customers. Guo Ping said.

Guo Ping believes that “after a year of training, Huawei has been ‘skin meat thick’, confident to find a solution.” Over the past 30 years, Huawei has brought digital technology out of its ivory tower, accelerating its global reach, covering more than 1,500 networks worldwide, providing smart terminal consumption to 600 million consumers and serving more than 3 billion people.”

How did Huawei get through the mud under the crackdown?

The effect of the pre-press is not ideal

“We can’t understand what the U.S. continues to crack down on Huawei and what it can bring to the world?” Guo Ping asked.

Aside from some political and trade negotiationfactors, ma Jihua, a communications expert, said the U.S. move was a “failure” because of the poor effectiveness of the original restrictions.

In May last year, the US added Huawei to the country’s “entity list” and then issued supply chain bans against Chinese telecoms companies such as Huawei and ZTE, but Huawei used its performance to show that the US crackdown had not been successful. In 2019, Huawei’s sales revenue was RMB858.8 billion, up 19.1% YoY, while its net profit was RMB62.7 billion, up 5.6% YoY, according to the financial results.

In addition, Ma Jihua believes that the United States’ European allies have recently loosened up some of China’s causes and began to “disobed” and that the United States needs to “kill chickens to see the monkeys”.

People in the UK and Germany have said in recent days that Huawei is needed to participate in the construction of 5G networks in their countries. As of February this year, Huawei has secured 91 5G commercial contracts, 47 of which are in Europe, 27 in Asia and 17 in other regions, with a total of 600,000 5G AAU modules shipped.

But in essence, Yu Chengdong, chief executive of Huawei’s consumer business, reportedly pointed out that the new U.S. rules for further blocking Huawei to address cybersecurity concerns were essentially to preserve The U.S.’s dominance in global technology. Huawei is currently one of the major players in 5G network equipment and an important member of the 5G Technical Specification Standardization Organization 3GPP.

“Huawei has unfortunately become one of the biggest targets of the U.S. in the Sino-U.S. trade war. But the U.S. also knows that sanctions against Huawei are a ‘kill a thousand enemies, self-inflicted eight hundred’ approach, and in the long run, U.S. companies will be hurt more if Huawei finds more alternative solutions outside the U.S. “Telecom analyst Fu Liang said.

Huawei’s purchases in the U.S. reached $18.7 billion last year, according to Mr. Guo. Losing this revenue would be a big loss for companies in the supply chain.

On May 18th it was announced that TSMC had stopped accepting new orders from Huawei after the US announced the latest export control regulations. In this regard, the Beijing Business Daily reporter contacted Huawei for confirmation, but as of the time of writing the other side did not respond. However, according tomedia reports, TSMC said reports that it had stopped offering new orders to Huawei were “purely market rumors”. It is reported that after the restrictions were upgraded again, Huawei urgently added an additional $700 million to TSMC, with a reserve capacity of more than 100 days.

How did Huawei get through the mud under the crackdown?

Bullying is greater than the actual effect

Therefore, in order to prevent direct adverse economic impact on foreign contract companies using U.S. semiconductor manufacturing equipment, the U.S. Department of Commerce will extend the temporary permit for China- and give a 120-day buffer period. “The door didn’t close completely, and like previous sanctions, the Commerce Department blocked it, but left a window. Fu Liang said.

As for how much impact will eventually be, Ma Jihua believes that the United States restrictive policy has a certain deterrent power, but in the short term only this impact, the United States only dare to “on the hoop”, but dare not easily “read the curse”, the implementation is too difficult, lack of the ability to monitor the world’s production network, can only rely on corporate declaration, bullying role is greater. “This measure is much more effective and will worsen the trust that China and the rest of the world have in the superpower, forcing everyone to innovate as a spare, and for a long time, america’s advantage will be severely weakened.” “

In his view, Huawei should continue to stock up and find ways to maintain enough strategic space, while striving to build a circle of Chinese friends and a stronger technological ecosystem.

For two years, Huawei is really trying to get rid of its dependence on U.S. companies. In terms of systems and software, In February, Huawei launched HMS Core 4.0 and the more sophisticated app store App Gallery in Europe, and launched its first Huawei phones with HMS services, the Glorious V30 Pro and 9X Pro;

But Fu Liang doesn’t see it that way. He pointed out that as an industry leader, Huawei is best aware of the gap between the various links in the industrial chain, 14nm replacement 5nm, may not be conducive to Huawei’s development. “Ren Zhengfei (Huawei founder) said well, even if you can do it, but also to buy more U.S., this is a clever strategy. “

Guo Ping also called for” “the world today has formed an integrated and collaborative system, which should not and is irreversible.” The separation of standards and industrial chains is not beneficial to either party and will have a serious impact on the industry as a whole. Industry should work together to continuously strengthen intellectual property protection, maintain market equity, and ensure a unified global standard system and a supply chain system of division of labor. “