Because US chipmakers fear a total ban on Huawei. The cases of Qualcomm and Intel
The Biden administration is reviewing the licensing policy that allows some shipments of US technology to China's Huawei. But US chip companies say restrictions on products supplied to Chinese telcos will hurt US industry revenues
A total US ban on telecommunications giant Huawei would put pressure on the Chinese businesses of Qualcomm and Intel.
According to the Wall Street Journal , the Biden administration is considering revoking export licenses issued to US suppliers for sales to Huawei. A new move in the tech war between the US and China.
As early as January, reports indicated that Washington was considering not granting any new export licenses to companies such as Qualcomm Inc. and Intel Corp, which supply the chips needed for smartphones and other devices. The action would cover products using advanced 5G technology as well as legacy 4G products.
In 2019, the Trump administration imposed tough restrictions on the export of American technology to Huawei, adding the group to a blacklist called the "entity list". Washington says Huawei's 5G wireless network equipment could allow the Chinese government to spy on American communications. Huawei has always denied the accusations arguing that its products do not pose a risk to national security.
Meanwhile, the Commerce Department continued to grant export licenses to some companies, including Qualcomm and Intel, to supply Huawei with technology unrelated to high-speed 5G telecommunications networks. But now the administration says the US policy that allows some shipments of US technology to the Chinese company is "under evaluation".
All the details.
THE ASSESSMENT OF THE BIDEN ADMINISTRATION
The US government is reviewing a policy that allows some US exports to continue to Huawei.
“A licensing rule from the previous administration still stands for Huawei that allows things below 5G, below the level of the cloud, to go, and I will say all of these things are under evaluation.” This was announced by US Department of Commerce official Alan Estevez, in a hearing in Congress, as reported by Reuters .
ALL THE STARS AND STRIPES MOVE AGAINST THE CHINESE TECH GIANT
In addition to placing Huawei on the "entity list", the Commerce Department moved in 2020 to prevent Huawei's suppliers from selling the company's chips made with US-built software and equipment, unless those suppliers also have not obtained a licence.
The Federal Communications Commission (FCC) has prohibited US wireless carriers from using federal funding to purchase Huawei network equipment. Last year it also banned future approvals of Huawei equipment for sale in the US.
Over the past two years, President Joe Biden has taken an even tougher stance towards China, recalls the Financial Times . In October, the US Commerce Department imposed restrictions on the supply of advanced semiconductors and chip-making equipment to Chinese groups.
THE CONSEQUENCES FOR THE HUAWEI BUSINESS
Prior to the US Department of Commerce's ban on business between Huawei and US hardware and software firms, the Shenzhen-based group had come to rival established chip firms such as Qualcomm and MediaTek in the chip market. To date, smartphones produced by the Chinese mount semiconductors from Qualcomm, but lack support for the 5G network.
AND THOSE FOR AMERICAN INDUSTRIES
But there is also a downside for American companies.
Between November 2020 and April 2021, the Bureau of Industry and Security, the office that oversees export controls, approved Huawei licenses worth $61.4 billion, according to Foreign Affairs Committee Chair Michael McCaul. Between January and March of 2022 alone, the Commerce Department approved more than $23 billion in license applications to trade with China-affiliated companies on the entity list.
So we are dealing with many billions of dollars of revenue that could vanish in the event of the cancellation of the licenses.
THE APPEAL OF USA TECH COMPANIES
And American tech companies don't want to lose such an important customer.
In late January, the Information Technology and Innovation Foundation, a Washington-based think tank that counts Qualcomm, Intel and most other big tech companies among its backers,launched an appeal .
"The administration's ongoing efforts to bolster the competitiveness of US technology are commendable, but completely excluding Huawei from US suppliers would likely have the opposite effect," the statement read.
“China remains a critical market for US technology suppliers, accounting for 36% of US semiconductor sales through 2019,” he continues. "Every dollar a US technology company makes in the Chinese market is one that Chinese competitors don't, so banning exports to Huawei helps Chinese technology suppliers and hurts their US counterparts," the information technology statement concluded. Innovation Foundation.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/innovazione/perche-i-chipmaker-usa-temono-un-ban-totale-a-huawei-i-casi-di-qualcomm-e-intel/ on Wed, 01 Mar 2023 12:19:03 +0000.