HiSilicon is one of the most important divisions of Huawei, as it handles the development of chips that power many smartphone devices. The division has become a core part of China’s plans related to semiconductor technology, but it is now targeted by the the U.S.
The subsidiary was established in 2004 and manufactured chips for Huawei devices and other interested customers. Huawei invested heavily in it, and recent events have cemented the brand’s reputation as a power player on the smartphone market and the telecommunications sector.
Downing the emerging titan
While most of the chips produced by the HiSilicon have been average in the past, the recent Kirin range can compete on equal grounds with the chips made by Apple and Qualcomm, and achievement which is quite impressive.
A new U.S. export control rule which has been revealed recently aims to block HiSilicon from using two essential tools: chip design software manufactured by American companies like Synopsis Inc and the foundry services provided by Taiwan Semiconductor Mnaufacturing Co Ltd, which is responsible for the manufacturing of many chips developed by semiconductor companies.
Halting the manufacturing process
Once the new restriction becomes valid, HiSilicon will lose its ability to manufacture chips, or it will be limited to modest ones that can be crushed easily by the competition. The strike against Huawei will be massive, as the loss of its own top-tier processors will make the company less competive on the local market, as many users will choose more powerful alternatives.
The new rule will not go into full force for 120 days, and Huawei has already started to stockpile chips. Some sources have also mentioned that Huawei may have the option to license some technologies.
Alternatives to the solutions provided by American companies are available, but the switch to new technology can be quite complicated, and the calibration process requires a substantial amount of experience.