Huawei might license its smartphone designs to avoid US trade sanctions
Huawei has been the subject of numerous back-and-forth battles over international trade, largely due to security concerns over the networking equipment it sells to carriers and other tech companies. That hasn’t stopped Huawei’s smartphone division from taking hit after hit, though — Google was legally required to withdraw the company’s Android license in 2020, and Huawei has had trouble acquiring chips and other components sold by US-based companies. Now the company has a plan to sidestep some of those obstacles, according to a new report.
Bloomberg is reporting (via Android Authority) that Huawei is planning to license the designs for its smartphones to other companies, as a method of gaining access to critical components. China Postal and Telecommunications Appliances Co., or PTAC for short, is planned to be the first company to participate. PTAC already sells Huawei phones on its website, and the new agreement will reportedly allow PTAC to sell self-branded devices based on Huawei’s designs. That way, Huawei can still design smartphones, and other companies (which may not be subject to the same trade embargoes affecting Huawei) can buy any required components themselves and sell the finished devices — seemingly a win-win situation.
Bloomberg also claims that China-based telecom equipment manufacturer TD Tech could be another Huawei licensee, and that all the planned partnerships could push Huawei’s smartphone shipments to more than 30 million units next year. Presumably, the third-party companies could obtain licenses from Google to distribute the Play Store and other critical applications, if they decided to sell phones internationally.
Even though the wave of US trade bans ramped up under the previous Trump presidential administration (with some actions dating back to the Obama administration), pressure on Huawei hasn’t significantly changed since President Biden took office in January. Earlier this month, the Secure Equipment Act was signed into law, which blocks new telecom equipment licenses for companies deemed security threats — which currently includes Huawei and ZTE, among others. Xiaomi has also faced a few problems, such as being added to an investment blocklist earlier this year.