Phone Wars 17

USA VS China Phone Wars Round 17

There have been multiple recent developments in the ongoing dispute between USA and China, what we’ve dubbed the Phone Wars. With the Trump ban still holding, Huawei was forced to launch its recent devices, like the Honor View 30 and V30 Pro, without access to Google or its popular first-party services like Maps, Earth, and more. Now, seeking for solutions, the Chinese manufacturer’s CEO points out at an inevitable shift in the world market, should both sides continue on their respective separate paths.

Huawei is a Chinese tech manufacturer founded by Mr. Ren Zhengfei thirty-two years ago. Just to bring everyone up to speed, about one year ago, the US government declared that Huawei technology is posing a risk to the safety of the government and a threat of espionage. The problem was that many companies had strong deals with Huawei, but due to this declaration, there can be no turnarounds or hoops to jump through to continue working. Thus, Google, Apple, and several other big names cut all ties with Huawei, and their industry peer ZTE.

However, this would be the tip of the iceberg, to say the least, as the situation kept complicating. At one point, Mr. Zhengfei’s older daughter, Sabrina Meng Wanzhou, who is the chief financial officer at Huawei, was detained by authorities in Canada at the request of the US government. The alleged accusation was that she violated some sanctions against Iran and the US government is quite protective of Iran, as we all know. As a response, the Chinese government detained two Canadian citizens who were in China at the time, and online reports state that that whole dire situation resolved peacefully quickly.

However, what became known as the “Trump Ban”, still remained and while previous Huawei Smartphone models have not been denied access to Google Play and services, all that came after, like Honor V30 and Huawei P30, were. Now, since Google’s first-party apps like Google Maps, YouTube, and others are quite popular and we have come to rely on them heavily, Huawei has no choice but to seek alternatives elsewhere or maybe even making their own substitutions.

Thus, Mr. Zhengfei points at the inevitable shift in the balance of the world’s market, should they continue on this path. Huawei is among the top manufacturers in the world, unchanged by this trade ban. No new Smartphone from the Chinese manufacturer has touched USA or UK market in the last year, but still, the company grows. Now, Mr. Zhengfei has finally spoken about the entire ordeal, and this is what he has to say:

“We will have to resort to alternatives. If those alternatives become mature, I think it’ll become less likely to switch back to previous versions. It is a critical moment for all of us, I hope the US government can consider what’s best for American companies.” – Ren Zhengfei, founder and CEO of Huawei.

Mr. Ren has called these actions by the US government unlawful. Now, what they really achieved was to prevent the US companies from taking funds from the Universal Service Fund (USF), which serves as a fuel to keep the tech development going and amounts to about $8.5B annually. This budget was previously used to purchase tech from two Chinese companies, but now, the tech inflow has been cut. Another statement from Huawei condemned these actions harshly stating that:

“These unwarranted actions will have profound negative effects on connectivity for Americans in rural and underserved areas across the United States. Many carriers rely on Huawei for its high-quality, market-leading, and cost-effective equipment and services.” – Huawei press release.

A spark of light comes from the last week’s decision by the US Department of Commerce, which extended the TGL (Temporary General License) for Huawei for another 90 days. It allows the continuation of service in some remote US areas, who would without the Chinese tech remain in the dark as far as telecommunications go.

“Without access to those solutions, these carriers will lose their ability to provide reliable and high-speed telecommunications and internet services and rural schools, hospitals, and libraries will feel the effects.” – Huawei.