|Join Nairaland / LOGIN! / Trending / Recent / New|
Stats: 2,754,911 members, 6,544,549 topics. Date: Monday, 18 October 2021 at 07:24 PM
|Huawei Still Has No Alternative To US Tech by Rapuru14: 10:54pm On Aug 21, 2019|
No matter how long the reprieve, Huawei still has no alternatives to US tech
It was over three months ago when the US decided to put Huawei on the entity list. After some lobbying from US suppliers, this was delayed for three months. More Huawei entities were added to the list and this 3-month reprieve is supposed to only serve existing customers. Warranted or not, Huawei’s faces the prospect of losing access to key US suppliers.
Huawei is still highly reliant on US tech and I’m not talking only about Qualcomm: Huawei still needs US tech to design and test processors while their memory chips incorporate US tech.
So, the three months is up, and the US government has given Huawei another 3-month reprieve of sorts, but this story isn’t any closer to ending.
There are some big questions that need answering before we can really say how this will all turn out:
If Huawei was finally cut off from US suppliers exactly how much trouble would the company be in?
What are its — and the Chinese government’s — options?
Could there be big opportunities for European and Asian tech firms to step in to fill the void left by banned US technologies?
Whilst Huawei founder Ren Zhengfei has put on a brave face in public, and first-quarter profits and growth have been impressive, in reality, the company has a very difficult road ahead with no end in sight if this ban is enforced.
Although there’s nothing so specific the US can point to this time, Huawei — like ZTE before it — has been in the country’s crosshairs for some time: concerns of IP theft, security back doors, and connections with the Chinese Communist Party.
Not only will the ban cut off Huawei’s US suppliers, but it can also spread to non-US vendors whose technologies incorporate American-made components.
We’ve seen plenty of headlines about Google ceasing Android support for Huawei and the recent release of HarmonyOS shows Huawei is taking this seriously. For now though, the company will still use Android in handsets but has its OS ready as a backup and for use in other devices. This is important, but it’s not the whole story by any means.
If it were the only issue, perhaps HarmonyOS could fill the gap. Granted, the company would face a drop in handset sales outside China. People don’t like moving to another operating system, and they’d face an absence of Google services and a smaller ecosystem of apps. Microsoft tried this and failed. But it might be a barrier Huawei could possibly overcome, especially as Android apps are supposed to work on HarmonyOS.
An equally critical issue for Huawei, however, centers on its hardware. Much has been made of the company’s ability to design its own chips. ZTE had been reliant on Qualcomm, so when it faced a US export ban, it didn’t have anything to fall back on, nor sufficient internal capabilities to design its own, no matter how hard its subsidiary Sanechips had tried.
Huawei, on the face of it, has its own chip design subsidiary in HiSilicon, and all high-end Huawei handsets use its Kirin application processors. Huawei’s main business though is telecoms equipment — cellular base stations, routers, switches and the like — and these use HiSilicon chips, too.
No Qualcomm, no problem – right? Wrong.
Firstly, to design and verify its chips, HiSilicon relies on Electronic Design Automation (EDA) tools from US companies like Synopsys and Cadence, as well as US-based Mentor Graphics (recently acquired by Siemens). There are no other companies in the world which can replace these tools. Empyrean, a Chinese company, may be able to handle a few of their tasks.
No chip design tools = no chips.
The second irreplaceable area is Field Programmable Gate Arrays (FPGAs), where the two big players are US firms Xilinx and Intel (Altera).
Their FPGAs are sometimes used in end devices if it’s deemed ASIC is not required, often when volumes are low, but they’re also used in the semiconductor design process for prototyping. Support for these and any future products would be lost, putting Huawei at a great competitive disadvantage.
Chinese companies such as GoWin and Unisoc have FPGA products and are trying to catch up, but they’re not there yet. I have yet to meet a Chinese company actually using their products in this way, although I see increased government investment in this specific area.
The third irreplaceable area is memory. Many of Huawei’s products use Micron memory right now. It could potentially switch from this US supplier to Korean vendors such as SK Hynix or Samsung. But, at the time of writing, I’m wondering if these companies could be affected by the ban because their products incorporate US technologies. Toshiba seems to have already been hit for the same reason. Not to mention the problems these companies face with the ongoing Korea-Japan trade war.
China has been building up its own NAND and DRAM capabilities, but the likes of YMTC, a leading Chinese memory design and manufacturer, are still some way off, and using the company’s memory would result in inferior products to Huawei’s competitors’. The same can be said for storage, solid-state and traditional, components in their data center and laptop products: there are no viable Chinese alternatives.
Added to all of this, Huawei will lose access to Intel processors, potentially killing its server and storage business, as the industry is dominated by Intel x86 architecture Xeon chips.
Without these chips, it can’t effectively compete in the server market – ditto the laptop sector. Huawei’s laptops receive universal praise on virtually any review site you look at. But without Intel CPUs, what does the Chinese firm have to fall back on? How well do non-Intel CPU laptops sell, and what if they aren’t even running Windows?
What may be the final nail in Huawei’s coffin is the way the ban is already spreading from US suppliers to other international firms.
Whilst I’ve mentioned Toshiba, the true shock for Huawei is that it could potentially lose access to Arm technology.
Most – if not all – HiSilicon’s chips are Arm-based, with its Kirin chip, server chips, camera chips, and router chips all based on Arm architecture. As an Arm architectural licensee, Huawei will, as far as I understand, be able to continue using the IP it’s already paid for it. But it loses access to support and further developments, which will deeply affect its competitiveness.
Huawei is already using its self-designed 64 core Arm-based Kunpeng server chip in some products, but its ecosystem is still small, and if it loses access to Arm, Huawei’s competitors would have access to the latest Armv9 architecture, which may come out in the next couple of years, while the telecommunications giant would be stuck with Armv8 and would likely have to build its own variant from that.
Huawei and the Chinese government have some tough decisions to make.
Some may argue Huawei could innovate its way out of this situation. Perhaps it could develop RISC-V based designs. But that’s a long shot without the tools required. And, although RISC-V is maturing and there’s a growing ecosystem around it, it’s still not Arm or x86. Nor will we see a RISC-V high-performance computing (HPC) server replacing Intel in the medium term or replacing the application processor within a handset for that matter. Some RISC-V based processors can run Linux now, but I don’t believe any are running Android yet. The community is moving fast, though, and some have even predicted the downfall of Arm at the hands of RISC-V.
If the “ban” is actually enforced for a long period of time, then possibly — through intensive Chinese government support — Huawei could be kept alive while it works out how to replace all this US technology with other options. Indeed, whether the ban is lifted or not, it’s another wake-up call for China.
I suspect investments in the industry will increase further from the $118 billion already planned. But, in the meantime, the company’s short-term success depends on how much of this technology it has in stock and whether the ban is actually enforced or if there is some workaround, like using design services. If it is enforced and there are no workarounds the company may need to lay off thousands of people until it, China, or non-US companies come up with suitable replacement technologies.
That would be embarrassing for Beijing, given how it has talked up its tech superiority to its domestic audience in recent years.
Alternatively, China could strike a deal with the US. This would likely mean concessions on China’s side, which wouldn’t go down well domestically, given the country’s history of unfair treaties with western powers.
So, China’s in a tight spot: let Huawei potentially lose its global status, or give further concessions to the US — and, either way, manage the message as best as it can. In both scenarios, a loss of face is inevitable. It must hope the tech lobby in the US is more powerful than Washington’s desire to “win” the trade war or destroy Huawei. Given the bipartisan support for a harder line against China, waiting for a new US president isn’t going to help Huawei get the parts they need.
|Sections: politics (1) business autos (1) jobs (1) career education (1) romance computers phones travel sports fashion health |
religion celebs tv-movies music-radio literature webmasters programming techmarket
Nairaland - Copyright © 2005 - 2021 Oluwaseun Osewa. All rights reserved. See How To Advertise. 84