Huawei outhustles Trump by stockpiling chips needed for China 5G

Topics Huawei | Huawei 5G | Donald Trump

Huawei’s breakthrough in securing essential supplies underscores the mixed success of a US campaign against China’s largest tech company since 2018 | Photo: Reuters
Huawei Technologies quietly spent months racing to stockpile critical radio chips ahead of Trump administration sanctions, ensuring it can keep supplying Chinese carriers in their $170 billion roll-out of 5G technology through at least 2021.

 
Partner Taiwan Semiconductor Manufacturing began ramping up output in late 2019 of Huawei’s 7-nanometer Tiangang communications chips, the most crucial element in 5G base stations, people familiar with the matter said. The Taiwanese contract manufacturer eventually shipped more than 2 million units at Huawei’s behest ahead of the sanctions cutoff last month, one of the people said, asking not be identified discussing internal matters. The sheer magnitude of orders at one point got TSMC executives wondering whether they had underestimated global demand, the person said.

 
Huawei’s breakthrough in securing essential supplies underscores the mixed success of a US campaign against China’s largest tech company since 2018. Citing national security concerns, the White House started by trying to curtail the sale of American software and circuitry to Huawei before finally enacting sweeping restrictions against its suppliers including TSMC.

It’s that last salvo, a ban on the sale of ready-made, commercially available semiconductors, that finally knee-capped Huawei’s smartphone business and forced it to curtail device production, sources said. Representatives for Huawei and TSMC declined to comment.

 
But the Tiangang chip, designed inhouse by secretive division HiSilicon, has proven pivotal to keeping the 5G business afloat.

Huawei had leaned on TSMC in the months before Washington shut that loophole and it can now continue to supply China Mobile, China Telecom Corp. and China Unicom — the carrier trio now aggressively building out a nationwide 5G network Beijing considers instrumental to driving the world’s no. 2 economy.

 
A China Mobile representative declined to comment for this story. A China Telecom spokesperson said the company will communicate any impact from curbs on Huawei but declined to comment on discussions about chip supply. Unicom representatives didn’t respond to requests for comment.

Saudi, Huawei sign deal to develop AI

 
Saudi Arabia and Huawei said they would work together to develop Arabic-language recognition in artificial intelligence (AI). Saudi Arabia announced the MoU during a virtual conference on Thursday.


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