Huawei's Challenges: ARM vs Google

In the wake of the U.S. ban on technology cooperation with Huawei, the company faces a critical decision: does ARM or Google's growing distance from Huawei have a more significant impact? From a technical standpoint, both have their unique challenges, but let's delve deeper into each to understand their implications.

ARM: The Unversible Impact on Huawei

ARM licensing is an intrinsic part of Huawei's chip development strategy. The inability to obtain ARM licensing will force Huawei to develop their own chip architecture, a process that is both time-consuming and expensive. While Huawei might have a stockpile of Kirin chips for the short term, the eventual depletion of this stock will leave the company in a dire situation.

Even if Huawei attempts to develop its own software and chips, the current state of their development capabilities is insufficient to match the performance of ARM-based devices. It could take 1 to 2 years for them to stabilize their product supply, during which time their market presence and global competitiveness will be severely hampered. The lack of a long-term solution in terms of chip development poses a significant threat to Huawei's future.

Google Services: Not a Long-Term Obstacle

In contrast, the exclusion of Google services has a more manageable impact on Huawei. Android, as an open-source platform, is fully operational and functional, even with the presence of forks like Amazon's Fire OS. Huawei can easily manage any security updates on its own without significant reliance on Google's services.

Moreover, there are numerous alternatives to Google Play Store, such as F-Droid, Termux, and others. Additionally, third-party apps can be easily sideloaded, giving users a wide range of options. For instance, Google Maps can be replaced with services like , which offer comparable functionalities.

Strategic and Economic Pressures

Beyond the technical challenges, there are strategic and economic pressures at play. Despite some initial bans, there are signs that the U.S. might back off due to pressure from companies like Qualcomm, which rely on rare earth supplies. Qualcomm, along with other tech giants, is deeply intertwined with Huawei in various aspects, making the complete ban difficult to maintain.

Conclusion and Outlook

While both ARM and Google have their unique challenges, ARM is clearly the more critical issue for Huawei. The transition out of the Google version of Android is feasible and within a reasonable timeframe. However, the transition out of ARM chip development is much more complex and requires significant investment. Without ARM, Huawei would eventually have no option other than developing their own chips from scratch, a process that is both resource-intensive and time-consuming.

In the broader context, the loss of ARM chips would not only hurt Huawei's smartphone sales but also affect its broader product range, including 5G equipment. The absence of ARM in the supply chain would create a bottleneck that cannot be easily bypassed. Hence, the long-term strategic advantage lies with ARM, making it the more critical issue for Huawei to address.