How Trump’s Huawei ban may affect Apple and other American tech companies.
It’s no longer news that Trump has effectively placed a ban on all American companies from doing business with Huawei. Tech giants like Google, Qualcomm, Intel etc were all forced to cancel all pending transaction with the Chinese giant. This move will no doubt deliver a crushing on Huawei’s smartphone business as it means all future Huawei smartphones will not be able to run on Android platform and will miss key services like Google play store, Facebook, Youtube, Whatsapp, etc. Even if it runs on Android, it will be the public version although Google has extended the deadline by 90 days.
However, the company has come out to dismiss the ban as a small setback for the company. Founder of Huawei says president Trump under estimates Huawei and that the company was already prepared for this situation a long time ago. Analysts say that Huawei plans to launch its own Operating System that will work just like Android and also support all Android Apps such as Facebook, Youtube and so on. Meanwhile, reports suggest that Huawei has been stockpiling chips ahead of the ban. The company has a huge stockpile of processors that will sustain it in the next few months.
After the ban was made public, Apple recorded a higher smartphone sales than Huawei but that’s where the advantage ended. Trump refused to look at the major effects of his Huawei ban on American tech giants including Apple.
Huge economic loss to American tech giants
Huawei is the world’s second largest smartphone seller after Samsung. Huawei does not manufacture most of its smartphone components. They rely heavily on American tech companies like Qualcomm and Intel to supply its components worth billions of dollars.
No company in the world would ever be happy to lose lies with such a giant company. Not even Google, Huawei has made a great contribution to the success of Google OS all around the world.
Boycott of Apple products in China
China is the biggest smartphone market in the world. Almost all major smartphone company make a large chunk of their profits from China including Apple. Report coming from China is that there’s a movement by angry groups to boycott all Apple products in China. If that happens, Apple will lose nothing less than 20% of all Apple revenue. Huawei is seen as a national champion in China and trying to destroy it will certainly not go down well with the people of China.
China may retaliate by banning all Apple products
The same way Apple is valuable in the US, that’s the same way Huawei is valuable in China. What most people don’t know is that all Apple smartphones are made and assembled in China. The Chinese government has the power to place restrictions on the production and sales of all Apple products in China. This move will effectively wipe billions of dollars in profit from Apple and make the few Apple devices available to be very expensive.
There’s no doubt the Huawei ban will cause a reduction in the demand for the smartphone in the future but they’re not the only ones to be affected. Tech companies all depend on one another and if one is affected, somehow all others are affected as well.