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Global Times: If the U.S. Hikes Sanction on Computer Chips, China Has Counter Measures

Global Times recently published a commentary written by Ni Guangnan, one of the founding members of the China Engineering Academy and the former Chief Engineer of the Legend Group. Ni said that the United States seems to be preparing to mount more sanctions on computer chip exports to China. The new plan may cut off chips manufactured by China’s primary overseas chip supplier TSMC (Taiwan Semiconductor Manufacturing Company). Though this plan can significantly damage China’s high-tech industry, yet China does have some counter measures. One example is to ban U.S. 5G chips or products with U.S. 5G chips from the Chinese market. The potential damage on just Apple and Qualcomm alone will be around US$70 billion. China can also set limitations on government procurement of U.S. IT products, which will severely damage the U.S. Wintel ecosystem. Apparently, the U.S. is not just aiming at Huawei, but at the entire Chinese high-tech industry.

Source: Global Times, April 3, 2020

LTN: Huawei Admitted Its Harmony OS Cannot Replace Android

Major Taiwanese news network Liberty Times Network (LTN) recently reported that the Huawei Western Europe Chief Vincent Pang admitted having “great difficulty” with handset sales. Pang said that, due to U.S. sanctions, Huawei lost its capability to bundle Google services on its smartphones. This heavily damaged Huawei’s international sales of consumer products. Huawei Chief Information Security Officer (CISO) Andy Purdy also complained about the U.S. sanctions which led to a cutoff of chip supplies from companies like Intel. It significantly limited Huawei’s growth. Huawei has its own Harmony OS, which was expected to replace Android to power Huawei’s smart devices. However, Huawei’s CEO of the Consumer Products Group, Yu Chengdong, recently told the U.S. technology magazine Wired that the company hopes to have the U.S. government’s permission to resume the partnership with Google, especially to use its Play Store. Yu said he would like to keep the Android ecosystem and the Harmony OS may need a couple more years to mature. Huawei also complained that the U.S. government still refused to open a dialogue with Huawei.

Source: LTN, April 1, 2020

LTN: The U.S. Aims to Cut Huawei’s Global Supply Chain

Major Taiwanese news network Liberty Times Network (LTN) recently reported that officials in the U.S. Trump administration have agreed to take new steps to reduce the global chip supply to Huawei significantly. The plan directly points to Huawei’s largest chip supplier TSMC. Taiwan Semiconductor Manufacturing Company (TSMC) is the world’s largest dedicated independent semiconductor foundry, headquartered in Hsinchu, Taiwan. According to the newly proposed rules, the United States will have to certify any foreign companies that use U.S. chip-making technology or equipment before they can sell chips to Huawei. According to anonymous sources, the new effort was designed to stop TSMC from manufacturing chips for Huawei. It is still unclear whether President Trump gave the OK to this plan or not. He may have some hesitation because the implementation of this plan may not only hurt TSMC, but may also impact U.S. companies. Huawei refused to comment on the news and TSMC said it cannot comment on hypothetical questions and won’t discuss matters regarding any specific customer.

Source: LTN, March 27, 2020

Xinhua: China Developed Facial Recognition Even with Masks

Xinhua recently reported that China Railway Science Research Institute just developed a new technology that can perform facial recognition even when the individual wears a regular mask and a helmet. The system will also measure the body temperature at the same time. Many industrial workplaces plan to deploy this new technology to monitor their locations where work resumed. The new technology focuses on characterizing eyes and eyebrows for pattern matching and does not require a hardware change to existing systems. With a large amount of data, current system accuracy reached 99.9 percent. It can also remind workers to wear a helmet if one is not recognized. The new technology development started before the coronavirus was a threat. The Chinese government has deployed a facial recognition monitoring system nationwide. Named Sky Eye, it has run into many issues related to suspects wearing masks to avoid identification. The new system is now improving image resolution for data collection; the goal is to reduce the number of cameras everywhere.

Source: Xinhua, March 11, 2020

Apple Smartphone Chinese Sales Saw a Sharp Decline in February

Shanghai-based Chinese financial news site East Money recently reported that, according to statistics that the China Academy of Information and Communication Technologies just released, the Chinese smartphone market declined by 54.7 percent, year-over-year. Apple iPhone sales in China saw a 61 percent decline during the same period of time. Apple announced its first quarter sales will miss its earlier projection, mainly due to the public health situation in China, which has impacted both manufacturing and market demand. Although Apple’s Chinese factories resumed their work, yet the pace of restoring capacity has been slower than expected. This will impact Apple’s global sales. Some Apple suppliers like Qorvo also reduced their forecasts. Also worth noting is that, the International Data Group (IDC) projects that the first quarter global smartphone sales will decline by 40 percent, year-over-year.

Source: East Money, March 9, 2020

HKET: iPhone XR Ranked Best Seller; Huawei Not in Top Ten

Hong Kong Economic Times (HKET), the leading financial daily in Hong Kong, recently reported that, according to market researcher Counterpoint, the Apple iPhone XR was ranked number one in the 2019 global top ten best seller of the smartphone market. In fact, six Apple iPhone models are in the top ten list. Samsung took three spots. Oppo is the only Chinese brand that won a spot. Well-known Chinese vendors like Huawei and Xiaomi had no product on the top ten list. iPhone XR is the only smartphone model, among all smartphones, that scored a double-digit market share in all important regional markets across the globe. The top five in North America are all Apple iPhones. The top five in Europe are either Samsung or Apple iPhones. The top five in China are all Chinese brands.

Source: HKET, March 2, 2020

Deutsche Welle: Internal Documents Showed Huawei Supplied Iran

Deutsche Welle Chinese Edition recently reported that newly obtained Huawei internal documents showed that the company did supply Iran with banned goods such as computer equipment that the U.S. company HP had made. The documents, dated February 2011, are packing lists of items shipped to Tehran, which were pending clearance through customs. These represent very strong hard evidence that supports the U.S. government’s charges against Huawei. The listed equipment involved millions of dollars’ worth of spending on Iranian communications projects. Also in the packing lists were details of servers and switches, as well as U.S. software products from Microsoft, Symantec, and Novell. The volume of the goods reflected in the documents reached 340 standard containers. Huawei refused to comment on this matter, citing on-going legal proceedings. However, Huawei insisted that the company had committed no wrong-doing and followed all of the requirements regarding sanctions from the UN, the EU and the United States. HP did confirm that all its contracts banned these products from being exported to Iran.

Source: DW Chinese, March 3, 2020

UDN: The U.S. Plans to Restrict China’s Use of Chip-Making Equipment

United Daily News (UDN), one of the primary Taiwanese news groups, recently reported that the U.S. Trump administration is considering a new trade restriction. This time it points to banning China from using U.S. chip-making equipment for manufacturing. The U.S. Department of Commerce is planning to amend its policies around Country of Origin, which means if it is national security related, there will be more restrictions on foreign vendors who want to use U.S. technology based equipment. This may result in a requirement to obtain prior U.S. permission for foreign manufacturers to produce chips to supply Huawei. Analysts expressed the belief that the new policy aims to slow down China’s speed of improving its technologies. However, the plan may also bring the risk of disrupting the global supply chain of the U.S. giants in the semiconductor industry. The plan is still under debate within the U.S. federal government.

Source: UDN, February 17, 2020

RFA Chinese: The U.S. Filed Suit against Huawei with 16 New Charges

Radio Free Asia (RFA) Chinese Edition recently reported that, while Europe gave Chinese telecommunications company Huawei multiple green lights, the United States did not rest. The U.S. Department of Justice filed another lawsuit against Huawei with 16 new charges, mainly focusing on stealing trade secrets. The new suit went against Huawei, four Huawei subsidiary companies, and Huawei CFO Meng Wanzhou. The prosecution alleged that Huawei has been stealing intellectual properties from six U.S. companies on the Internet router source code, cellular antennas, robotic testing technologies, and other issues. Huawei typically performed the stealing via breaching NDAs (non-disclosure Agreements), obtaining knowledge from former employees of competitors, penetrating via proxies like professors, and establishing awards to encourage its own employees to steal from competitors. Huawei also exports to Iran and North Korea, who are under sanctions from the U.S., Europe, and the United Nations. The White house is working with U.S. technology giants like Microsoft and Dell to establish a new 5G network without Huawei.

Source: RFA Chinese, February 14, 2020

Chinese Mobile Phone Manufacturers Jointly Build Google Play Competitor

Chinese technology news site My Drivers recently reported that four major Chinese mobile phone vendors, Huawei, Xiaomi, Oppo and Vivo, jointly formed a platform named Global Developer Service Alliance (GDSA). The new alliance was established with an aim to compete against Google Play, which is Google’s online flagship app store. GDSA is to combine services for app development, marketing, distribution, and monetization for markets outside China. So far, the alliance covers nine regions including India, Indonesia, Russia, and Malaysia. Huawei will utilize the new platform for the European market. The platform planned to go live in March. However, it has been postponed due to the Coronavirus situation. All four vendors refused to comment on the news. Since Google revoked Huawei’s Android license, Huawei mobile phones are not able to use Google Play. Huawei has been developing an App Gallery as a replacement, but it has been difficult for a single vendor to combat Google’s market dominance. By the end of 2019, Chinese mobile phone vendors held 40 percent of the global handset market.

Source: My Drivers, February 7, 2020