US chipmakers quietly lobby to ease Huawei ban: sources

Chipmakers say Huawei units unlikely to present same security concerns as Chinese tech firm’s 5G


Reuters June 17, 2019
Chipmakers say Huawei units unlikely to present same security concerns as Chinese tech firm’s 5G PHOTO: REUTERS

SAN FRANCISCO/WASHINGTON: Huawei’s American chip suppliers, including Qualcomm and Intel, are quietly pressing the US government to ease its ban on sales to the Chinese tech giant, even as Huawei itself avoids typical government lobbying, people familiar with the situation said.

Executives from top US chipmakers Intel and Xilinx Inc attended a meeting in late May with the Commerce Department to discuss a response to Huawei’s placement on the black list, one person said.

The ban bars US suppliers from selling to Huawei, the world’s largest telecommunications equipment company, without special approval, because of what the government said were national security issues.

Qualcomm has also pressed the Commerce Department over the issue, four people said.

Chipmakers argue that Huawei units selling products such as smartphones and computer servers use commonly available parts and are unlikely to present the same security concerns as the Chinese technology firm’s 5G networking gear, according to three people.

“This isn’t about helping Huawei. It’s about preventing harm to American companies,” one of the people said.

Out of $70 billion that Huawei spent buying components in 2018, some $11 billion went to US firms including Qualcomm, Intel and Micron Technology Inc.

Qualcomm, for example, wants to be able to continue shipping chips to Huawei for common devices like phones and smart watches, a person familiar with the company’s situation said.

The ban came soon after the breakdown of talks to end the months-long trade spat between China and the United States, spurred by US allegations of Chinese corporate espionage, intellectual property theft and forced technology transfer.

Google, which sells hardware, software and technical services to Huawei, has also advocated so it can keep selling to the company, Huawei Chairman Liang Hua told reporters in China earlier this month.

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