Who is Huawei's plan B?

Jun 23, 2020 HUAWEI

On June 17, Nikkei Asian Review reported that Huawei had notified some suppliers that it would postpone the release of the flagship Mate series of mobile phones, suspend the production of some parts of the Mate series, and cut down the orders of mobile phone parts in the next few quarters. What's more, Huawei will further evaluate the impact of supply chain disruption.

Huawei Mate series is positioned for high-end business market, which will be launched in September each year with the newly developed Kirin chip. It is the highlight moment for Huawei's product in the whole year. However, in fact, not only smartphone chips, but also Huawei 5G network equipment chips and cloud chips will be affected to varying degrees.

At the same time, from May 20 to mid-June, Asia Times has disclosed that South Korea will become a key breakthrough for Huawei. Huawei may reach an agreement with Samsung on chip manufacturing. According to the agreement, Samsung will manufacture chips for Huawei's 5G equipment. Considering that Huawei's core business is telecommunications equipment, the business of smartphone has a lower income compared with the core business, so Huawei will strategically give up the market share of smartphones. Huawei and Samsung will move from competition to cooperation.

As South Korea is China's largest supplier of memory chips, the two countries have a close relationship in terms of industrial supply chain. Affected by the US policy of restricting Huawei, South Korean technology companies will also be hit hard. Commercial enterprises are even more pursuing the maximization of benefits. Samsung Li Jianxi once said that the two keywords of Samsung in the 21st century are digital and China. Besides, Samsung is the only company that can compete with TSMC in the 7nm and 5nm processes. Under this premise, it is possible for Samsung to become Huawei's plan B, which has attracted much attention from the outside world.