Samsung’s solution to Huawei’s crisis – supplying the Chinese company’s 5G telecommunication equipment chip with European-Japanese technology

Samsung’s solution to Huawei’s crisis – supplying the Chinese company’s 5G telecommunication equipment chip with European-Japanese technology

Samsung’s solution to Huawei’s crisis – supplying the Chinese company’s 5G telecommunication equipment chip with European-Japanese technology

News unit exactly one year after Huawei’s placement on the blacklist of the US Department of Commerce (for security reasons), the US government by changing the chip export rules to Huawei, made it more difficult for this Chinese company. According to some experts, this precise timing by the United States cannot be a coincidence. Being blacklisted by the US Department of Commerce, while preventing Huawei from accessing the American supply chain, has also barred the Chinese company from using Google Mobile Services (GMS). As a result, Huawei had to release new smartphones of the P40 series. with a native ecosystem called HMS (Huawei Mobile Services) will be launched.

Also, with the launch of the exclusive Petal Search application, Huawei users around the world can find app stores that allow them to download and install applications such as Facebook and Instagram. he does; Absence of Google applications in Huawei phones, a special problem for Chinese users It does not cause problems because most of these applications are banned in China, but Huawei users in other countries will not feel good about the absence of Google Play Store and applications such as Google Search, Gmail, YouTube, etc. Despite these limitations, Statistics show Huawei in 2019, with the release of about 240 million smartphones, its second place in the world (after Samsung).

One of Huawei’s weak points is its chip manufacturing unit, HiSilicon, which has the sole task of designing mobile chipsets and is dependent on TSMC to manufacture them. Of course, this is not at all unusual because TSMC is the largest independent chipset manufacturer in the world, and in fact, a large part of the chips designed by Apple, Qualcomm and MediaTek, manufactured by TSMC. It is interesting to know that after Apple, Huawei is TSMC’s biggest customer. But the business relationship between Huawei and TSMC may be in trouble.

According to New prohibitions of the US Department of Commerce against Huawei, chipset manufacturing companies that use American technology in the manufacture of their products, for export Huawei’s chips must first be licensed in the United States. Of course, the chips from the wafers that are in the production stage can be supplied to Huawei, but on the condition that these chips are delivered to Huawei by mid-September of this year. This deadline will allow Huawei to have enough 5nm chips, likely named Kirin 1020, to produce all Mate 40 and Mate 40 Pro models.

But Huawei’s main problem will show itself next year when it produces the P50 flagship series. Apart from the discussion of chips for smartphones, Huawei’s more serious problem is in providing powerful chips for fifth-generation telecommunications equipment. As you know, Huawei is the largest provider of 5G network equipment in the world.

Experts have put forward ideas that Huawei can use to bypass the new rules and instead of directly buying chips from TSMC, the chipsets of this to buy the Taiwanese company through an intermediary from MediaTek. Of course, TSMC is against this method and has announced that it will not allow this. But the Asia Times news agency on Sunday, June 14, 2020 (June 25, 2019) reported that Samsung announced.

The company Samsung is the second independent manufacturer semiconductor products in the world and according to Asia Times, one of the production lines of this company uses Japanese-European technology to make 7nm chips. Considering that this production line is completely free of American technology, Samsung can legally export the chips made in it to Huawei without obtaining a license from the United States.

Samsung needs EUV lithography machines to produce 7nm chips in this production line and imports these machines from a Dutch company called ASML. By engraving patterns on silicon wafers, these machines determine where to place transistors on the chip. The patterns created by the UV rays are very thin, allowing more transistors to fit on a single chip. The more transistors inside the chip, the more powerful and less power consuming that chip will be. Using the technology of this Dutch company, Samsung can fit 10 billion transistors in a chipset the size of a fingernail. In addition to the aforementioned Dutch machines, Samsung also needs other machines to test the chips, each of which it buys for $40 million from a Japanese company called Lasertec.

Samsung and Huawei are said to be in talks, and if these talks come to fruition, Samsung will produce the advanced chips that Huawei uses in the 5G network equipment business. needs it, will undertake it. On the other hand, Huawei is giving up part of its share in the global smartphone market to Samsung. The probability that the two parties will reach an agreement in these negotiations is high, because Samsung’s dependence on smartphones is more than that of Huawei. What is more important than smartphones for Huawei is the 5G network business. Currently, Huawei has contracts that obligate it to deliver 600,000 5G base stations (which were supposed to have chips from TSMC) to its customers. As such, this could be a good opportunity for Huawei to save its telecom business by losing some of the smartphone market.

Economically, South Korea’s exports to China are twice the country’s exports to America. Also, South Korea needs China’s help to curb the erratic behavior of its northern neighbor. The South Korean government has called US restrictions on chip sales to Huawei and other Chinese companies “unacceptable,” according to industry sources.

It should be said that another company that supplies Huawei chips is the Chinese company SMIC. But the problem is that the most advanced chipset produced in this company is made with 14 nm lithography, which is far from TSMC products. Of course, SMIC hopes to complete the production of 7nm chips by the end of this year, but the point is that if this company uses American technology in the production of its chips, it will have to obtain a license from the United States to export them to Huawei. Was. Another important point is, how fast can China upgrade its domestic chip production capacity? If you remember, after the Trump administration ordered in April 2018 to ban the sale of Qualcomm chips to ZTE, the Chinese company was effectively shut down.

At the end, it should be mentioned, according to the news from Reuters published, the US Department of Commerce has reconsidered its previous decision and reduced the restrictions imposed on Chinese companies, including Huawei. Of course, the United States government has not changed its previous position towards Huawei and still considers this company a threat to its internal security, but apparently it is willing to change the restrictions applied to allow companies to compete with Huawei in terms of 5G standards. cooperate.

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