ARM amputation: Huawei's big chip problem

Ann Santiago
May 24, 2019

Finally, it's important to highlight once again that Huawei's Kirin chips are unlikely to survive without Arm's support, so in the grand scheme of things, TSMC's business may not help the world's fastest-growing smartphone manufacturer as much as you'd expect.

Experts say the move could potentially cripple Huawei's ability to make new computer chips for its future mobile phones, as numerous processors it uses are based on Arm's designs.

The BBC reported earlier on Wednesday that ARM, which is owned by Japan's Softbank, had instructed employees to halt "all active contracts, support entitlements, and any pending engagements" with Huawei after the United States added Huawei to a list of companies with which US firms could not do business. One analyst described the move, if it became long-term, as an "insurmountable" blow to Huawei's business. Mobile subsidiary have terminated sales of Huawei P30 series phones, which were scheduled to start on Friday.

Arm, the Cambridge-based microchip group, will stop licensing its designs to Huawei after Washington's export ban last week. Plus, the US government has signaled it may be willing to bend in the interest of consumer safety. ARM's designs form the basis of most mobile device processors worldwide. Which U.S. law enforcement has accused of violating intellectual property rights and stealing the technology of American companies.

The big difference is that because the App Gallery requires a Huawei ID account instead of a Google account and doesn't have any direct ties to Google or Google's Play Store, Huawei should be able to continue using the App Gallery to distribute apps to its users long after the current 90-day extension expires. The latest development in this ban is ARM.

This kerfuffle comes in the wake of Google pumping the brakes on its relationship with the Chinese tech company - although owners of existing Huawei phones will still be supported; they just won't receive Android updates or Google technical support outside of what's available through an open source license. That is a really tough miracle to pull off - or perhaps Huawei's backup plan foresaw ARM's departure too.

Just a few days after the United States added Huawei to its "Entity List", things are continuing to go south for the Chinese manufacturer. "We believe that this regrettable situation can be resolved, and our top priority remains to continue to provide world-class technology and products to our global customers", Huawei says in an official statement.

That could, in turn, have a major negative impact on the overall business as Huawei is forced to scramble for alternate technology.

Despite the United States government providing a 90-day delay for Google and HUAWEI, this doesn't apply to ARM and all interactions with HUAWEI and its subsidiaries are immediately suspended.

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