Huawei’s ‘Secret Plan’ To Defeat Trump: New Report

Huawei is pushing forwards with a “secret plan to beat American trade war sanctions,” according to a new report from Nikkei Asian Review. At issue is the U.S. blacklist—in place in part since May, its heavily restrictive sanctions prevent U.S. companies supplying hardware or software to the Chinese tech giant. It has been clear for some time that Huawei has been working up non-American alternatives to power its product set. Now, according to Nikkei, companies across Asia are “receiving a similar message from Huawei—boost your production, and we will buy your product.”

One supplier described the supplier program, which has particularly targeted chip makers, as “like preparing for wartime—Huawei staff are on-site almost seven days a week, from day to night, nitpicking and reviewing all the details, demanding strictly that the local company meets global standards as soon as possible."

Huawei’s commitment to chip suppliers is, reportedly, to guarantee up to 80% utilization rates for the next two years. A clear illustration of the size of the prize for Asian manufacturers and the size of the risk for their U.S. equivalents.

Huawei spends more than $70 billion each year on its supply chain, and of that as much as $11-12 billion has in the past been spent in the U.S. The shift of that procurement budget from West to East will influence research and development budgets and manufacturing investments that drive efficiencies and volume capacity.

Watching events unfold will be Intel, Qualcomm, Google, Microsoft and many others. Speculation has been rife in recent months as to the lobbying taking place from U.S. big tech to its government to relax restrictions and prevent a splitting of East and West technology standards and supply chains.

There are echoes in this news of the long-term Huawei program to develop its HarmonyOS Android alternative, with talk of secret meetings and engineering projects that suddenly accelerated once the blacklisting was signed by U.S. President Trump. HarmonyOS was launched just a few weeks ago, albeit the software does not. yet replace the all-important licensed version of Android that Huawei has relied on to power its international smartphone business.

In just a few days time, Huawei will unveil its first smartphone to launch absent U.S. tech. And while the company has heralded a new in-house chip to drive the device, there is a yet no clarity as to how users will workaround the lack of Google software and services. Right now, the best bet is an unlicensed, open source version of Android that includes user-friendly processes to download and install Google Maps, YouTube, Gmail and access to the Play Store ecosystem.

If Huawei can successfully shift users from licensed to open source Android, and introduce a mass-market workaround for Google apps and services on those devices, then this becomes a far more realistic alternative to Android than an extension of HarmonyOS from IoT platforms to smartphones.

With or without this shift, Huawei has also confirmed huge levels of investment from its staggering war chest to build out its own ecosystem. Despite talking up the continuation of the company’s reliance on Google if possible, there seems to be a recognition from what the company says in private that the launch of an alternative OS to Android and iOS would be good for the market and its own long-term security.

And this is the crux of what’s at issue for Huawei, China and the U.S. If Huawei, with its reach and resources, goes this route, it will encourage others to follow. And the current U.S. domination of the global smartphone market diminishes quickly. Europe is the toughest market to crack—but Asia, Africa and the Middle East are less so. And as other Chinese manufacturers move in behind Huawei the overall market shifts.

For Google, everything would change—suddenly it becomes heavily reliant on Samsung’s views of the world to drive its continuing control of the fully licensed version of the Android OS. And the same runs across the Android supply chain—locks will be broken, alternatives found. The market has not been shaken up like this in a decade. There would be no turning back.

And so the twist here is that while the short-term risk is all on Huawei, diminishing its smartphone market share and influence, the longer term risk is arguably much more tipped towards the U.S. And the scale of the longer-term opportunity for Huawei might just make the risk worth taking—almost regardless of what now happens over the blacklist and the ongoing trade talks between Washington and China.

And that would become the long term legacy of the standoff.

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As the Founder/CEO of Digital Barriers, a developer of disruptive AI surveillance solutions for defense, security and commercial organizations in the US, EMEA and

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