Tighter U.S. restrictions on Huawei go into effect on September 15, and companies around the world are forced to choose either side. We've already seen the world's largest foundry, TSMC, say it will no longer do business with Huawei, despite the fact that Huawei was crowned the world's largest smartphone maker last quarter. The next companies to get out are Samsung, LG, and SK Hynix. This emerges from two reports on the Korean website Chosun Ilbo.
Trade war! USA versus China
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First, Chosun Ilbo reports that Samsung Electronics and SK Hynix have announced that they will stop selling chips to Huawei. Samsung is the world's leading memory manufacturer, and SK Hynix is number 2, so Huawei will have to source NAND flash and DRAM storage from elsewhere. The number 3 memory manufacturer is the American company Micron, which Huawei has already avoided. On the RAM market, Samsung, SK Hynix and Micron are the "big three" manufacturers and together have a market share of around 94 percent. All three are also major players in the NAND flash memory market, which, according to Statista, includes Samsung (35.5 percent), Kioxia (18.7 percent, formerly Toshiba Memory), Western Digital (14.7 percent) and Micron (11th , 3 percent) belong. Intel (9.7 percent) and SK Hynix (9.6 percent). These manufacturers, who cover 99.5 percent of the market, are all based in the US, Japan, or South Korea, so probably no one will sell to Huawei. Things look bleak.
According to Chosun Ilbo, Huawei is the third largest buyer of semiconductors in the world. The company accounts for 6 percent of Samsung Electronics' semiconductor sales and 15 percent of SK Hynix sales. However, Huawei knew this ban was long-standing, and the report said the company "has a two-year inventory".
According to Report No. 2, Samsung Display and LG Display have stopped selling to Huawei. Samsung makes the best OLED displays for smartphones. Regardless of the name on the outside of a phone, most flagship smartphones use Samsung displays. There are many ways to smash the display market, but the most relevant is the OLED smartphone market, where Samsung has an 81.2 percent market share and LG a 10 percent share for the fourth quarter of 2019, according to Pulse figures. 8 percent had.
Huawei's best choice for displays is the Chinese company BOE, which was number 3 on the list with a market share of 1.6 percent. Huawei regularly uses BOE displays on some devices, most notably as a supplier for the Huawei Mate X, although flagships like the P40 Pro + still used a Samsung display. BOE is the largest manufacturer of displays overall, but has barely gained a foothold in the OLED smartphone market.
A chip stake and alternative Chinese vendors may keep Huawei running a little longer, but the company's immediate problem is software that has been blocking use of the Play Store and Google's Android apps. Tomorrow Huawei is expected to demonstrate the progress of its Android rival "Harmony OS" announced last year. It's likely not ready to fight Android just yet, but in the long run the company hopes the project will be successful if Tizen, Windows Phone, Blackberry 10, Sailfish OS, Ubuntu Touch, Firefox OS, Symbian, MeeGo, and WebOS all fail .