HUAWEI Technologies Co., the Chinese technology giant barred from doing business with U.S. suppliers, is finding a way around the strict limits imposed by the Trump administration. The U.S. Commerce Department, citing national security concerns, has largely forbidden American companies from selling Huawei the computer chips it needs to make a piece of equipment integral to newly introduced high-speed wireless networks. In response, China’s largest technology company ramped up its own capabilities to manufacture the gear, which is known as a base station. In a sign that the self-reliance is working, Huawei in the fourth quarter sold more than 50,000 of these next-generation base stations that were free of U.S. technology, according to Tim Danks, the U.S.-based Huawei executive responsible for partner relations. That’s only about 8 percent of the total base stations that Huawei’s sold as of February, but the company is quickly ramping up at its HiSilicon division to make more of these American component-free devices, Danks said. “It’s still our intention to return to using U.S. technology,” he said. The longer Huawei goes without access to U.S. suppliers, the more unlikely it is to be able to return to using them, Danks added. A base station is a typically suitcase-sized piece of machinery that’s used to help connect wireless phones to fixed-line networks carrying Internet traffic, and it’s an essential ingredient in the next, or fifth, generation of mobile networks. Popular among telecommunications providers, Huawei’s base stations are widely considered among the most reliable for the price. As of early February, Huawei had shipped about 600,000 5G base stations to mobile phone companies racing to upgrade networks to the new standard, which is designed to deliver data at faster speeds to a broad range of wirelessly connected devices. Most of these base stations were made using stockpiled chips bought before the ban. The U.S. initially clamped down on all shipments of U.S. supplies to Huawei, which had spent more than US$10 billion a year on U.S. products, but later began making some exceptions. Xilinx and fellow chipmakers Micron Technology Inc. and Broadcom Inc. have all reported falling earnings on reduced or eliminated sales to Huawei. Attempts by the U.S. to persuade European and other allied countries to ban Huawei equipment have not succeeded, and chipmakers in Asia and Europe continue to supply it. The Chinese company led the market for base stations with a 28 percent share last year, according to New Street Research. The investment company predicts demand for that equipment will rise this year with the 5G network buildout. (SD-Agencies) |