Is the US shooting itself in the foot by banning Huawei?

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localizer

Colonel
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I guess from here on and out its time to 1000% throttle tech development. like it’s war.

If they try to strong arm TSMC we might see some bigger actions. *wink *wink
 

Max Demian

Junior Member
Registered Member
It is blessing i disguise really now they have no choice but buying from domestic source reservation not with standing This in turn will spur domestic chip to improve the quality now that they have big client behind them

Chip making is low margin with high capital cost. They need buyer to justify high capital cost Now they have captive market. SMIC already started the production of 14nm finfet memory chip with high yield So it just matter of time really

I think you are a bit misinformed about the margins. The margins are low only for nodes several generations behind, like the ones China can now domestically manufacture. For cutting edge nodes, the picture is quite different and TSMC can charge a premium.

Also, in an all out trade war SMIC could find itself in the same spot as Huawei. Fujian Jinghua was shut down quite abruptly. Taking out US companies from the supply chain is going to prove very difficult.
 

Hendrik_2000

Lieutenant General
I think you are a bit misinformed about the margins. The margins are low only for nodes several generations behind, like the ones China can now domestically manufacture. For cutting edge nodes, the picture is quite different and TSMC can charge a premium.

Also, in an all out trade war SMIC could find itself in the same spot as Huawei. Fujian Jinghua was shut down quite abruptly. Taking out US companies from the supply chain is going to prove very difficult.

I don't think SMIC and Jianhua situation are the same . SMIC has the design and the production facilities are complete, done They have been producing chips for many years I bet they stock up on parts for their production facilities
They have extensive Semi FAB all over China. And has all kind of chip design from RF chip to memory chip IoT, industrial and car chip
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Jinhua does not have the design for the memory chip they rely on UMC Their plant is incomplete. They are new company with no previous experience in semiconductor fabrication
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As I said due to segmentation of Huawei product they do import Qualcomm chip But they also have in house design team HiSilicone that can easily design mid range SOC. Design is not a problem for China they have hundred of fabless design houses But in the past the Chinese industry doe not invest in Chip making FAB because there is no demand. All those smart phone, computer and electronic industry are recent phenomenon And their reluctant to sink in huge money in semi fab. The same logic applied to chip making tool and industry

But now with the backing of state they pour billion of dollar in Chip making industries and they scare the hell out of the US semi manufacturing and that is the heart of this trade dispute Sooner or latter the US semi industry will loose their market in China

I don't think SMIC is behind the curve when it come to technology they are just behind TSMC and Samsung But comparable to any other chip company Intel is still in 14 nm technology.
In the past Chinese companies shun domestic industry because the have access to the like of Qualcomm, intel etc . Now they have no choice
 
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Icmer

Junior Member
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This discussion shouldn't focus solely on SoCs, as I noted in a post from January in the now-locked Trade War thread:
Trade War with China
Their telecom equipment also relies on cutting-edge American optical components.

This supplier list is similar to what I remember reading for when ZTE was crippled:
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It also depends on smaller American suppliers in key areas:
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for optical cable;
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for fiber-optic connectors; Inphi Corp. for analog chips;
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and
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for radio-frequency semiconductors in both 4G and 5G; and
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for storage.
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supplies it with digital signal processing chips. Huawei even uses Oracle Corp. software in products sold to state-owned companies.

The Bloomberg article also mentions this:
Huawei’s base station, smartphone, server and maritime cable businesses simply cannot run without Qualcomm baseband and processor chips. There are alternatives -- but from American peers such as
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, Micron and
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.
Roger Sheng at market research firm Gartner Inc. draws parallels with the Chinese fable of the
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, whose powers are constrained by a magic circlet that his handler constricts -- painfully -- when the deity misbehaves.

“The U.S. is putting a circlet around the head of Huawei,” said Sheng, who is based in Shanghai. “The impact goes well beyond its 5G ambitions because without American suppliers like Qualcomm and
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, it can’t even maintain normal operations.”

I'm skeptical of this conclusion about total Qualcomm reliance since HiSilicon obviously exists for smartphone SoCs/modems and Huawei has been designing ARM server chips, but I'm not sure about the component origins of their base stations since it's difficult to find this information.
 
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Icmer

Junior Member
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An industry article from 2016 talks about Huawei pushing to localize optical components. Huawei would be quite negligent if the supplier situation hasn't vastly improved since.

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fibeReality believes that Huawei Technologies is striving to develop coherent optics and optical switching components, as well as potentially other types of new devices further down the food chain with the intent of going head-to-head across the world with major competitors in the market, including Finisar, Lumentum Holdings, and Oclaro. It seems that a logical assumption can be made that Huawei will follow the money in terms of prioritizing on particular technology. As we have
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, the temptation for Huawei may get to be irresistible, particularly in its home country, in which massive networking buildouts will evidently continue indefinitely.

With state control over the economy, there is always the possibility that it may be decided without any notice to substantially cut back or even halt purchases of optical equipment in China for a while. Yet, the major means of the country currently dealing with its economic difficulties (for better or worse) is through heavy investments in infrastructure. While there appears to be compelling requirements for a great deal of deployment of optical transport gear moving forward, there is that much greater amount of assurance of it continuing because it would tend to be looked upon as just another extension of the overall strategy to improve its financial situation.

Given that the next wave of sales into China is focused on ROADMs, one may assume that Huawei would attempt to target WSS gear with its initial product offerings. At a minimum, even if the new solutions were to become part of a game plan of just becoming more vertically integrated, Huawei would be positioned to get much better deals from its existing vendors, resulting in lower margins.

In fairness, there was
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in late 2012 “that Huawei was close to releasing an internally developed ROADM (an optical switching component) solution,” which was supposedly going to have a negative impact on Finiar. Apparently, it turned out to be either a false alarm or was at least made up for by the qualification of new products from the US company to the Chinese system house.

Nevertheless, it is now four years later. Over this time, a lot of work on components by Huawei proceeded ahead, such as in establishing or further bolstering several R&D centers around the world, along with an effort of continuing to scout for technology to buy to incorporate into those centers. For example, in 2013, Huawei purchased an optical chip startup in Belgium, Caliopa. In addition, a good number of optical componentry patents have been obtained by the company during this period.

Another important consideration is that there are undoubtedly still hard feelings in China over the temporary restrictions placed by the US government on optical components sold to ZTE, including from Acacia Communications. Several months after the constraints were removed, a particular
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that “China might set its sights on ensuring a local supply of high-end optical devices in the future." If as we expect Huawei becomes a major threat in the optical component arena sooner rather than later, it would truly be ironic because it is that same person who coined the
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.

It would hardly be unprecedented for Huawei to disappoint component vendors in various industry sectors by bringing functionality in-house. This past summer the supplier’s decision to internally construct a critical base station device resulted in Integrated Device Technology taking a substantial revenue hit.
 

Gatekeeper

Brigadier
Registered Member
I just watched CGTN, the Anchor was saying that this "national security" not only stop foreign companies to sell its ware in the US, BUT it also stop US companies from selling goods/services to them!

Now, I'm not tech minded, but does this have a big impact on huawai, in terms of Chips and software⁉
 
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