What should a smartphone manufacturer do if they can't install processors in their smartphones? It just seems that the processor is something that is easy to buy or install, but, as practice shows, this can be much more complicated. For example, Huawei, which they could not “strangle” with a ban on working with Android, is now being finished off with a ban on developing their own processors. At the same time, the wording is very ornate. Of course, the company will not be left without a processor completely, but high-performance chips, which it had before, it may lose. What's next? White flag and defeat?
Will Huawei be able to work without Kirin chips?
Huawei may lose Kirin processor
Perhaps soon Huawei will have to give up Kirin's own silicon in favor of chips from other manufacturers. This is because new licensing restrictions by the US Department of Commerce for international companies using US software and technology are stifling the production of their own chipsets. Thus, according to reports from CNMO and Nikkei, Huawei and its subsidiary Honor are considering cooperation with MediaTek and UNISOC Silicon in anticipation of problems with the supply of their own chips.
One might ask why the company won't be able to buy Snapdragon chips, but there is a reason. Huawei has not been able to work with Qualcomm and its processors since the trade ban went into effect in 2019, so the Chinese are focusing on their own Kirin chipsets.
A year has passed since the US sanctions against Huawei took effect. Despite this, the company still remained in the top three world leaders in smartphone sales. In the global market, sales have indeed fallen, but on the domestic market, the company is still not bad at all (in China, and so there is no Google) – due to this, it retained its position. If Huawei is doing well in the domestic market and the ban on the use of Google services did not greatly affect anything, then the only way to deal with it would be restrictions that will create problems during production.
For now Huawei will continue to receive Kirin chips.
Therefore, the US Department of Commerce issued a new regulation aimed at preventing overseas manufacturers using US software and technology from working with Huawei. This resulted in the Kirin chipmaker to stop accepting new orders from Huawei. This is due precisely to the hardware on which the chips are manufactured, as well as software and even the rights to the processor architecture, albeit to a lesser extent. As a result, the company will not be able to use its own hardware for the foreseeable future.
As a result, Huawei and Honor had to study the possibility of switching to MediaTek and UNISOC for some of their devices. Itself Huawei is allegedly already in talks with manufacturers that are large in Asian markets. Zhao Ming, president of the business department Honor, made similar comments in an interview after the launch Honor of the X10, which is still powered by the Kirin 820 chip.
MediaTek even already works on some mid-range devices Huawei, so the timely switch to more productive chips of the company does not seem strange neither for Huawei nor for Honor. It is still clear that Huawei is facing increasingly desperate times, as the use of competitor chips could hinder the company's development over other phone makers such as Xiaomi, which are already using third-party chips.
Manufacturing your own hardware is a big plus in the competition for several reasons. This includes lower cost, and the ability to adapt to your own needs, and even a reduction in the risk of supply disruptions. All this is very important for successful work and really gives a competitive advantage.
MediaTek may not be that bad, but can a Huawei P50 Pro work on them?
If Huawei have to switch to chips MediaTek, many customers may not like it. Even the high-performance chips released under this brand cannot compete with the top-end solutions from Qualcomm. Even if technically they are close, in the eyes of buyers they will still yield – even in China.
Someone might suggest a switch to Samsung's Exynos chips, but such a decision is highly unlikely due to the fact that the Korean manufacturer's chips are also likely to come under sanctions.
As a result, the company does not have many exits and something needs to be addressed. So far, it has processors, since the sanctions do not prohibit the fulfillment of the obligations of the parties already assumed. That is, the production that was agreed upon before the imposition of the new ban will continue. This will give the company some time to adapt.
Of course, Huawei will not be left without processors and will continue to produce gadgets and equipment. The only question is that it will be more difficult to sell products. And it’s also very interesting what will happen next and what new sanctions will be imposed on the company if the new ban does not cause serious harm to it again.