Huawei US companies allowed to work with Chinese giant

Huawei: US companies allowed to work with Chinese giant

The US announced a change in the ban on US companies working with Huawei. American companies will therefore be allowed to share information about technologies with Huawei, in order to develop common standards without the need for an export license.

The boycott continues

The US Secretary of Commerce, Wilbur Ross, explained, however, that this policy change is not a relaxation of the government’s position on Huawei, which is still on the Washington blacklist. The objective of the amendment is in fact to ensure that American companies can still contribute to the development of standards for 5G, artificial intelligence, autonomous technologies, and other technologies in which Huawei is heavily involved.

The United States will not give in to global innovation leadership. This action recognizes the importance of harnessing U.S. ingenuity to advance and protect our economic and national security,” said Wilbur Ross. “The department is committed to protecting U.S. national security and foreign policy interests by encouraging U.S. industry to fully engage and advocate for U.S. technologies to become international standards.”

The announcement follows Washington’s recent decision last month to stop Huawei’s supply of semiconductors, as companies need an export licence to sell to the Chinese giant.

North of the border, Canadian telecommunications companies also blocked Huawei’s access to their 5G network by signing agreements with rivals of the Chinese giant. The Chinese supplier of network equipment is also banned in Australia and failed to incur into New Zealand after GCSB prevented Spark from using the Huawei kit in November 2018.

Nokia partners with China Unicom

Meanwhile, Huawei’s competitor, Nokia, was chosen by China Unicom to help build its autonomous 5G network in China. The company announced on Monday that it had obtained about 10% of the construction of China Unicom’s 5G core network. The Finnish network equipment provider will help establish connections, manage bandwidth, scale and network security, and open the 5G network to support new use cases such as network trunking.

The two companies previously signed an agreement for Nokia to provide its cloud-based vIMS platform for China Unicom’s Volte network. Nokia currently owns a 17% share of China Unicom’s Volte network.

Nokia also announced on Monday that it has partnered with Broadcom to develop chips for 5G equipment. This is the third such agreement for Nokia, after those with Intel and Marvell. Both companies will develop new custom chip-based processors that will be integrated into Nokia’s "5G Powered by Reefshark" product line, and deployed in many of Nokia’s network solutions.

Ericsson also wins 5G contracts in China

Like Nokia, Ericsson announced last week that it won 5G contracts in China, after signing agreements with the country’s three main telecommunications operators: China Unicom, China Telecom and China Mobile. Ericsson did not provide details on these agreements.

At the time of the announcement of these contracts, the compan
y added that it would experience a decline of about one billion Swedish kronor during the second quarter, due to the depreciation of stocks of pre-commercial products for the Chinese market.

“Margins in the second quarter of 2020 are expected to be negative due to high upfront costs for new products,” says Ericsson.