Biting the Hand that Fed You
Huawei has been under pressure as the US has continued trade sanctions against the company, extending them from what were direct sales exclusions to considering any component produced using US equipment a violation last year. The impact on Huawei’s smartphone business has been quite pronounced and caused the company to sell its Honor (pvt) brand, which was developed by Huawei to appeal to a young and less affluent segment of the global population, and in November of last year Huawei sold the brand to a consortium of over 30 agents and dealers, including a division of China Telecom (728.HK) and the Shenzhen government.
As part of the trade sanctions imposed by the US, Huawei lost the ability to access the Google (GOOG) Play store and the ability to access and update the Android operating system in all of its existing phones, and would therefore be unable to release new phones that would allow users to access Android services. While China is less dependent on Android than the global community, it severely limited Huawei’s global smartphone business, and pushed Huawei to step up development of its own Hongmeng (Harmony) OS to replace Android.
As we have noted recently, Huawei has officially released the Harmony OS and is actively promoting the OS to smartphone and CE brands in order to lessen product dependencies on Android and bypass some of the US restrictions, however the CEO of Honor recently announced that it new flagship phone the Honor 50 5G will continue to use Android across the Honor 50 line and not adopt its former parent’s OS, although he stated that they will keep an eye on future Harmony OS ecosystem developments. In this case, it seems obvious that Honor, which is totally independent of Huawei and is therefore outside of the US restrictions, is looking to appeal to a more global customer base that requires the ability to access Google services and likely has little or no allegiance to Huawei, as some on the Mainland do. While it is a tangible blow to Huawei, it goes to show how difficult it will be for Huawei to establish a new OS in the global smartphone market. If you have every had your kids ask to be dropped off a block from school, you know what that feels like…
As part of the trade sanctions imposed by the US, Huawei lost the ability to access the Google (GOOG) Play store and the ability to access and update the Android operating system in all of its existing phones, and would therefore be unable to release new phones that would allow users to access Android services. While China is less dependent on Android than the global community, it severely limited Huawei’s global smartphone business, and pushed Huawei to step up development of its own Hongmeng (Harmony) OS to replace Android.
As we have noted recently, Huawei has officially released the Harmony OS and is actively promoting the OS to smartphone and CE brands in order to lessen product dependencies on Android and bypass some of the US restrictions, however the CEO of Honor recently announced that it new flagship phone the Honor 50 5G will continue to use Android across the Honor 50 line and not adopt its former parent’s OS, although he stated that they will keep an eye on future Harmony OS ecosystem developments. In this case, it seems obvious that Honor, which is totally independent of Huawei and is therefore outside of the US restrictions, is looking to appeal to a more global customer base that requires the ability to access Google services and likely has little or no allegiance to Huawei, as some on the Mainland do. While it is a tangible blow to Huawei, it goes to show how difficult it will be for Huawei to establish a new OS in the global smartphone market. If you have every had your kids ask to be dropped off a block from school, you know what that feels like…
"Next time, drop me off a block away" - Source: Simplemost.com
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