What lies ahead for Huawei and its many users following the US drama? 1 year ago

What lies ahead for Huawei and its many users following the US drama?

A lot has happened in the last few days.

A proverbial storm brewed up when US President Donald Trump added Huawei to a trading black list last Thursday, basically preventing US companies from trading with Huawei without a special licence.


The move had knock-on effects meaning that, as things stood, Google would no longer be able to provide the Chinese phone giant with crucial technology, including access to its Play Store, where all Android apps are downloaded.

It also meant Huawei would not be able to buy essential parts for their phones from US suppliers.

This was a huge blow to both Huawei and Huawei users, who faced uncertainty over how exactly it would affect them going forward.

On Monday, stocks took a dip with shares in US chipmakers Qualcomm, Broadcom, Micron Technology and Nvidia (all suppliers of Huawei) falling by more than 3% on Monday, sending the tech-heavy Nasdaq index down 1.5%.

But one day on, the problem has been pushed down the pipeline 90 days as the US granted the Chinese tech giant a temporary licence to buy US products to maintain its networks and release software updates for existing smartphones and tablets.

The markets responded positively across Europe, Asia and the US, although we're likely to encounter the same issue again at the end of the reprieve unless something changes.

Huawei Ireland promised users that they will provide security and after-sales services for all existing Huawei and Honor products.


Many are seeing this as just the latest escalation in the trade war between the US and China, while others believe it's the first die cast in a tech Cold War between two of the world's superpowers.

China’s government on Tuesday once again reiterated its promise to defend Chinese companies abroad but gave no details of what Beijing might do.

American officials say Huawei and other Chinese telecom equipment vendors are a risk because they are beholden to the ruling Communist Party. Huawei has strenuously denied accusations it facilitates Chinese spying.


However, it's not just Huawei who will be rocked should no agreement be reached; Google will loath losing out as well.

Huawei is the second largest smartphone supplier in the world, having overtaken Apple in the last year. Four out of the top 10 smartphones sold in Europe in the last year were Huawei devices.

No agreement will force Huawei to launch their own operating system globally (it's already in use on some of their devices in China) which then has the potential to become a competitor with Android. That has the potential of a double blow for Google; losing out on users and potentially creating a fierce rival in the process.

In a recent open letter, Huawei President Teresa He Tingbo wrote that the company has been preparing for this kind of scenario for many years and said they "do have a backup plan".


But will they have enough support to bring developers aboard to create apps for their new operating system? If the answer is no, then anyone who had a Windows phone years ago will remember just how few and far between apps were.

If the answer is yes, then US jobs could be affected by increased Chinese output and less demand for American components.

The uncertainty of Monday remains, and while it's been delayed until autumn this year and there's no telling how this trade war between the US and China plays out, there are very few positive ourcomes on either side should this escalate.

While the trade conflict between the US and China looms large, there's a lot at stake for some huge tech companies, and we can't help but feel a solution to the Huawei issue will be discovered before the end of the 90 days.


Don't believe us? Just look how quick action was taken when the markets dipped on Monday.