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ARM Suspends Business With Huawei Just As EE Removes Huawei Phones From 5G launch

Daniel Nenni

Daniel Nenni

Admin
Staff member
I have done business in Asia for most of my 35+ year semiconductor career and am on my way to Taiwan this weekend so I will find out more. I just don't see this ending well. China a super power in all regards (economic, military, technology, etc....) and feel this is too little too late. Please contribute your thoughts as well.

Richard Yu, CEO of Huawei's consumer business, described the U.S. blacklisting as a "big surprise," and one that means "a very tough time" for the consumer business. If that wasn't obvious enough with the Google suspension, it is now, with the almost simultaneous news that chip-maker ARM and mobile network EE have dealt further crushing blows to the company.

www.forbes.com

ARM Suspends Business With Huawei Just As EE Removes Huawei Phones From 5G launch

ARM and EE delivered crushing blows to Huawei on Wednesday. The Chinese company's business has been suspended by the leading chip-maker, which could "obliterate" its smartphone business, and had its 5G smartphones kicked from the U.K.'s first 5G network launch.
www.forbes.com
 
My thoughts are that it will end well. Economic competition is always there. The US, since it won the Cold War and Russia collapsed politically, had assumed that it had no competition. Guess what, China will be a great competitor.
 
We have a serious problem, China has already stolen over a trillion dollars and probably much more IP, giving them a huge economic boost. Before both sides can do anything we have to address this and come to a mutually acceptable IP protection protocols that are transparent and have an enforcement, penalty and remediation system that is fair to all parties world wide. This will also have to apply to data, which is becoming the building blocks of everything and has not really been dealt with by any country in a comprehensive manner. The QUALCOMM/APPLE mess shows even the US has serious problems in this area. The solutions have to be world wide or they become irrelevant.
 
I have a certain amount of shock regarding ARM joining the sanctions somewhat voluntarily. Of all the sanctions, losing access to ARM probably hurts the most. Losing access to the non-OSS parts of Android affects Huawei consumer products outside of China, inside China they probably have alternatives.

Behind the scenes, lots of companies complain about China business practices but few take affirmative actions. Google and ARM have now stuck their necks out, far out. I think this will result in ARM and Google specific sanctions. That is how China operates.

In a past version of capitalism, if ARM and Google had cut off customers this way, it would have been grounds for breakup of their monopoly power, dissolving their business units, breaking up the trust. Using monopoly power in this way may be justified this time, but it will undoubtedly be used again, for smaller and smaller offenses, until someone, perhaps the European Union, steps in.

Huawei, ARM and Google are like the too big to fail banks in 2008. They are all too big, too connected to government influences, are too powerful and insulated, and if they fail, will hurt all of us. This was true before Trump weaponized ARM and Google, and it will be true if the dispute dissolves after a few months, like the ZTE dispute.
 
According to the Synopsys investor call they have cut ties with Huawei as well. So no more EDA software or IP from Synopsys which caused them to warn down. There was a CEO panel event the ARM CEO was supposed to attend but Simon was a no show. Good thing too because China was a hot topic of discussion. One of my trusted sources that does business in China told me that the Huawei matter would be resolved by the end of June in saying that China had no choice but to give in. I tend to agree. No hardware, no software, no IP, Huawei is in big trouble.
 
Daniel Nenni said:
According to the Synopsys investor call they have cut ties with Huawei as well. So no more EDA software or IP from Synopsys which caused them to warn down. There was a CEO panel event the ARM CEO was supposed to attend but Simon was a no show. Good thing too because China was a hot topic of discussion. One of my trusted sources that does business in China told me that the Huawei matter would be resolved by the end of June in saying that China had no choice but to give in. I tend to agree. No hardware, no software, no IP, Huawei is in big trouble.
Click to expand...
Dan, if a company was to use unlicensed EDA tools, would they leave a fingerprint on the final design that could be confirmed in a court of law and what is your opinion on the legal ramifications if any? Also, would this be applicable to pieces of unlicensed chip designs?
 
and we still get news that HiSilicon will be the first to have a product in 7nm+ (EUV) from TSMC. but without CAD tools (I suppose Cadence is probably cutting ties as well) and without ARM support and License, is it even possible ? Apple and Qualcomm will be the 2 true first to access the technology.
 
I think a long-term impact is this will harden the Chinese political position that suppliers should be from China as much as possible. (even if this gets resolved shortly) . Everyone already knew this was the Chinese position -- that will only be accelerated. In future, China IC industry will do whatever is needed so they can't be disabled by future trade disputes with the US.
 
Even if China spent billions and billions, it's doubtful they could replicate a useful ARM / EDA ecosystem for the leading edge. Kind of hoping they try, just for an education in the futility of going it alone.
 
Just FYI, ARM can stop to supply IP to Huawei officialy, the (dead) JV that ARM has created with a Chinese consortium before to exit (or been kicked off?) will do. ARM CPU IP are available to Chinese customers through this JV...
 
The next few months will be very interesting, the only thing on the news in China is this trade war, it seems that's will not back down.

Tools destined from Huawei have recently been refused exit from US ports. If China doesn't back down, how could Huawei survive, interesting and dangerous times ahead.
 
China will no cave as they'd rather take a heavy toll than to show a sign of weakness.

JohnnyFox said:
If China doesn't back down, how could Huawei survive, interesting and dangerous times ahead.
Click to expand...

Huawei will survive because it's backed by the Chinese government. The cost will be high though.
 
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