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zeusthemoose

Huawei Will Soon Run Out of Chips

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Posted · Original PosterOP

Summary

 On Sunday, Huawei CEO of Consumer BG, Yu Chendong (a.k.a. Richard Yu), announced that "chipset finishing within the company's dedicated HiSilicon facilities" will end before September 15th. Simply put, this means they will run out of their Kirin processors.

 Unlike most other phone manufacturers, Huawei designs their own chips. However, they still rely on others to make the chips. It was previously TSMC, however that stopped when the US banned the involvement of US companies with Huawei. They have tried to setup their own manufacturing plants, but have been unsuccessful so far. They might turn to MediaTek to manufacture the chips as MediaTek is already making many mid-level devices for Huawei. Once, they run out of chips, Huawei will not be able to produce mobile devices anymore.

  However, the day before this announcement, Qualcomm started lobbying the US Government to remove the restrictions on selling components to Huawei. They are looking to be able to sell chips that Huawei will use in their 5G phones. This is likely the Kirin processors that they are running out of. This is initiative by Qualcomm is following the settlement of a dispute with Huawei which ended with Huawei having to pay Qualcomm $1.8 Billion in catch-up payment.

  There have been no developments in the US's restrictions on Huawei yet.

 

Quotes

Quote

Huawei is one of a very few smartphone OEMs that also develops the processors for (most of) the same devices. However, unlike Samsung, it has had to farm the actual making of these chipsets out to companies such as TSMC. These companies have announced that they will comply with punitive trade regulations that prevent the electronics giant from using US technologies. It now seems these measures have started to show their effects.

Normal supply-side Huawei partners have found themselves barred from fulfilling orders dated May 15, 2020 or later, and from sending shipments dated September 14, 2020 or later. Therefore, Yu Chengdong, (also known as Richard Yu) has publicly acknowledged that chipset finishing within the company's dedicated HiSilicon facilities cannot proceed beyond September 15, 2020.

Therefore, it is only a matter of time before the company runs out of new Kirin processors to incorporate into phones. The company had had plans to implement its own foundry so as to be immune to an eventuality like this; however, according to the latest reports, this independent capability has not materialized.

It is not clear how the company will proceed in terms of producing new mobile devices at this point. It is possible that it will turn to MediaTek's emerging Dimensity series of platforms instead, as it does for some of its mid-level devices at present.

(Notebook Check)

Quote

Chipmaker Qualcomm Inc is lobbying the U.S. government to revoke restrictions on sale of components to Huawei Technologies Co [HWT.UL], after the Chinese company was blacklisted by the United States, The Wall Street Journal reported on Saturday.

Qualcomm is lobbying to sell chips to Huawei that the Chinese company would include in its 5G phones, according to the report, citing a presentation by Qualcomm.

With these restrictions, the U.S. has handed Qualcomm’s foreign competitors a market worth as much as $8 billion annually, the report said.

(Reuters)

 

My thoughts

 I highly doubt the US Government is going to ease restrictions on Huawei to allow Qualcomm to sell them processors. I think that if Huawei cant find a manufacturer quickly, their product lines will be in serious danger. I could very easily see this being the reason that Huawei goes down.

 

Sources

 Reuters

 Notebook Check


I am far from an expert in this so please correct me if I’m wrong.

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I don't think they'll necessarily go down. They're a large company and will likely receive assistance from the CCP.

Personally I hope they do fall, and I hope TenCent isn't far behind.


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7 minutes ago, dizmo said:

I don't think they'll necessarily go down. They're a large company and will likely receive assistance from the CCP.

Personally I hope they do fall, and I hope TenCent isn't far behind.

I hope they don't fail as they are a competitor in a higher barrier to entry market. 


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25 minutes ago, dizmo said:

I don't think they'll necessarily go down. They're a large company and will likely receive assistance from the CCP.

Personally I hope they do fall, and I hope TenCent isn't far behind.

Why do you want a company to fail?

 

And I don't think the Chinese government can help them. Even if they somehow manage to build a semicon fab it still won't be on par with what US companies can do.

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big oof, but i doubt this will end them. 

 

from the OP:

Quote

They might turn to MediaTek to manufacture the chips as MediaTek is already making many mid-level devices for Huawei.

we all know that midrange is where sales are at, this will just hurt their ability to make some high end stuff but i doubt that would sell well anyway what with the whole pandemic thing....


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59 minutes ago, LAwLz said:

Why do you want a company to fail?

 

And I don't think the Chinese government can help them. Even if they somehow manage to build a semicon fab it still won't be on par with what US companies can do.

I want any CCP backed company to fail. Which includes a disturbingly increasing amount of USA companies too.

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1 hour ago, dizmo said:

Personally I hope they do fall, and I hope TenCent isn't far behind.

yep, fuck the 200,000+ people who work for them and their subsidiaries, they don't deserve jobs

fuck all companies that use their networking gear who will no longer get support

fuck competition

 

All because of (still) unproven allegations.

Guess i should stop buying anything made in or by US companies, you know, just in case.

 

 


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Some Chinese hackers were able to steal some semiconductor secrets from 7 unnamed Taiwanese chip companies.

 

I'm guessing the Chinese government will either threaten jail time or pay well for the hackers to reveal the secrets to SMIC, the Chinese chip maker that Huawei is supposedly due to partner with. If this happens, I don't think Huawei would mind one bit.

 

However, I realize I am severely simplifying the circumstances, but it's just some of my thoughts on this whole ordeal.


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there's exactly one company that makes euv litho machines and that's ASML and they already delayed a shipment to china due to the blacklist. Even DUV machines at the high end are all ASML afaik. SMIC is fuk. WW3 when china comes for taiwan soon?

 

 

Edit: Oh wow SMIC made it to 14nm, not that fucked yet, but huawei can't get anything comparable to what they had via tsmc.

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2 hours ago, LAwLz said:

somehow manage to build a semicon fab it still won't be on par with what US companies can do.

China has a small 14nm fab but

1. Huawei will have to step down their expectations because 14 nm is worse than the 7nm process from TSMC they have previously used

 

2. China’s 14nm capacities are very small so could definitely not saturate Huawei‘s appetite for chips 


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3 hours ago, Eaglerino said:

I want any CCP backed company to fail. Which includes a disturbingly increasing amount of USA companies too.

Why? Even if Huawei was backed by the CCP (which is a very simplistic way of looking at things) making the company go under has massive implications for everyone, not just the CCP.

 

Also, government funded or backed does not automatically make it a bad thing. There are a ton of US companies who have received money from the US government as well, and that is not an issue either.

 

 

 

2 hours ago, S w a t s o n said:

there's exactly one company that makes euv litho machines and that's ASML and they already delayed a shipment to china due to the blacklist. Even DUV machines at the high end are all ASML afaik. SMIC is fuk. WW3 when china comes for taiwan soon?

 

 

Edit: Oh wow SMIC made it to 14nm, not that fucked yet, but huawei can't get anything comparable to what they had via tsmc.

Well if the US keeps forcing China to invest more into domestic companies (because that's the only thing available) then it won't take long until China is ahead of the west in lithography.

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Some comments have been removed, remember this is a tech forum and comments around news topics like this should be primarily tech focused. Some borderline comments have been left but conversations off those need to be tech focused as mentioned or those and the original will also be removed.

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What would happen if Huawei/Tendent decided to buy shares of Qualcomm or something, or maybe another big actor like Corning to annoy the US government and companies? That's what I would do, and even ask the Chinese government for help if needed.

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10 hours ago, LAwLz said:

Why do you want a company to fail?

 

And I don't think the Chinese government can help them. Even if they somehow manage to build a semicon fab it still won't be on par with what US companies can do.

Perhaps not fail completely, but definitely fail in terms of expansion beyond their borders. See below.

 

The CCP can help them financially, and through contracts for local infrastructure. Though even then, they wouldn't really need to. Over 60% of Huawei's business is done within Chinese borders. So them losing out on these foreign markets really isn't a massive blow to them (6% for NA, only 8% regionally). They make a lot of things other than phones, so losing the high end chips will hurt their revenue, certainly, but there's so many things that don't require them to work. Just their flagship devices.

 

8 hours ago, Arika S said:

yep, fuck the 200,000+ people who work for them and their subsidiaries, they don't deserve jobs

fuck all companies that use their networking gear who will no longer get support

fuck competition

 

All because of (still) unproven allegations.

Guess i should stop buying anything made in or by US companies, you know, just in case.

Perhaps not fail completely, but definitely fail in terms of expansion beyond their borders.

 

You also don't seem to fully understand why they don't want Huawei's 5G infrastructure widespread, especially in the Western countries. It's not really has Huawei been used to spy on these nations, it's what will happen in the future if they are implemented. It's significantly harder to take something out once it's already in place. Chinese companies will bend to the will of the regime, and if asked will turn over sensitive information gathered by these networks. That's just how the country's structured. So no, it's not about yours, or mine, or Joe Blow down the street's private data. It's about everything else that would also be flowing through the 5G network that's sensitive. And if you think "oh that won't happen", why have so many Chinese companies already been caught sending information back to China from cell phones and TVs? You could even tinfoil hat it, and say that it'd be easier for the CCP to plant agents in a Chinese company, and gain access to information that way.

 

Your view on the whole US thing is very misled. US foreign policy, while not great, is vastly better than Chinese.

If you don't see that, or don't know why it pertains to the topic in question, you don't have any idea of what's really going on.


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11 hours ago, zeusthemoose said:

 

My thoughts

 I highly doubt the US Government is going to ease restrictions on Huawei to allow Qualcomm to sell them processors. I think that if Huawei cant find a manufacturer quickly, their product lines will be in serious danger. I could very easily see this being the reason that Huawei goes down.

 

 

 

Huawei isn't going down, they'll just have to use one of the 80+ Chinese fab's and that means they will be behind by a year (however there are no listed fabs under 14nm in China, they just got to 14nm this year.) Non-news. Likewise Qualcomm is just seeing $_$ in their eyes.

 

 

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6 hours ago, LAwLz said:

Well if the US keeps forcing China to invest more into domestic companies (because that's the only thing available) then it won't take long until China is ahead of the west in lithography.

How do you figure that? What domestic options are they are going ot invest to to overtake ASML and TSMC? That was the point of my post. They come for tsmc or they are fucked. You think you can just throw money at advanced lithograhpy? They can reverse engineer the few 14nm machines they have but EUV, good fucking luck. It took the combined effort of the US + world DECADES to make EUV workable. Intel is having problems, and they arent having a cash flow problem.

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Well it's not much news yet, but could be big.


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I said this in the other thread and I'll say it again here.  China has the ability to develop all their own tech, they have already been at it for a few years now and they are not about to give up.  They may not develop it in enough time to keep Huawei from production issues, but it won't bother them long term.

 

 

 


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