US President Donald Trump recently signed an executive order that barred American telecoms firms from installing foreign-made equipment that is deemed to pose a threat to national security. The Commerce Department then quickly put Huawei and its 70 affiliates on an “entity list”, which will prevent them from buying American parts and technologies without seeking Washington’s approval.
Following the developments, three major American chip manufacturers (Qualcomm, Intel and Broadcom), two wireless solution providers (Qorvo and Skyworks), glass manufacturer Corning, and some software developers including Google and Microsoft cut off business ties with Huawei.
The moves have affected Huawei’s smartphone business, as well as its wireless and internetequipment services operation. It’s a fatal blow for the Chinese telecoms equipment giant.
Soon after, we’ve had reports that Huawei had begun to develop its proprietary operating system (OS), Hongmeng, six years ago, in a bid to substitute Google’s Android system. Huawei has said the OS will be ready for Chinese consumers later this year, and that international customers will get it by 2020.
Now, we come to the question: will Huawei really be able to compete with the Google and Microsoft mobile operating systems?
There are, in fact, a handful of smartphone OS available in the market, including Kai OS, Sailfish OS, Ubuntu Touch, WebOS, etc. Samsung, once a big threat to Google’s version of Android, has all but given up on its Tizen operating system for phones. All these OS altogether account only for a very small market share, and some of them are in fact American firms, which have tried and failed to replace Android.
All of these phone OS alternatives have failed for many different reasons. Among various factors, maintaining a wide portfolio of apps and convincing app makers to list their popular apps on the platform are key to success in developing one’s own OS. Google Play had around 2.1 million mobile apps as of the first quarter of this year, while Apple’s App Store has 1.8 million apps available. Therefore, other mobile OS need to find developers and redevelop some widely adopted mobile apps.
That may take a few years and it explains the dominance in the operating system held by Google’s Android and Apple’s iOS.
Previously, Huawei’s fellow Chinese telecoms gear maker ZTE (00763.HK) had caved into US pressure and agreed to pay heavy fines and reshuffle its management team to escape sanctions. Now, it is Huawei that is facing heavy curbs from Washington amid rising trade tensions between the US and China.
The Chinese firm’s prospects are unclear at the moment; only time will tell if the group will be able to ride out its current troubles without too much damage.
This article appeared in the Hong Kong Economic Journal on May 28
Translation by Julie Zhu with additional reporting
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