Huawei Mobile Phone Split? Official Denial

Recently, rumors spread that Huawei will sell its mobile phone business. It is said that Huawei's mobile phone will be sold to an enterprise led by the state owned assets supervision and Administration Commission of the city. The negotiation is coming to an end and will be announced soon.

A person familiar with the matter told the 21st century economic report that Huawei is discussing the issue of divestiture of mobile phones, with the target of its Shanghai terminal related departments. The research and development of Huawei's high-end series mate and P are mainly located in Shanghai. It is reported that in addition to mobile phones, tablets and other products or sold together, only Hisilicon and base station business.

However, on January 25, Huawei terminal told the 21st century economic reporter: "Huawei has no plan to sell mobile phone business at all. Huawei will continue to build the world's leading high-end smart phone brand and strive to provide consumers with excellent product experience and service. "

According to the data from the semiconductor research office of trendforce, the top six brands in the world in 2020 are Samsung, apple, Huawei, Xiaomi, oppo and vivo. Compared with 2019, the biggest difference lies in the change of Huawei's market share.

Looking forward to 2021, trendforce predicts that the global smart phone industry is expected to recover with the increasingly stable life style. With the support of cyclical phone replacement demand and emerging market demand, it is estimated that the annual total production will grow to 1.36 billion units, with an annual growth rate of 9%.

It is reported that Huawei is discussing the issue of divestiture of mobile phones, with the target of its Shanghai terminal related departments. Photo by Zheng dikun

Huawei terminal supply chain security is urgent

Due to the regulatory policies of the United States, Huawei is unable to obtain high-end mobile phone chips, which hinders the development of terminal business. In order to survive, Huawei has to divest part of its business. On November 17, 2020, Huawei confirmed the sale of glory, and the suppliers took over the offer.

At that time, a number of Huawei supply chain enterprises issued a joint statement, and Shenzhen Zhixin new information technology Co., Ltd. had signed an acquisition agreement with Huawei Investment Holding Co., Ltd., completing the comprehensive acquisition of business assets related to glory brand. After the sale, Huawei no longer holds any shares in new glory.

Today, glory is recovering rapidly in the supply chain. Recently, Zhao Ming, CEO of glory Terminal Co., Ltd., said in an interview with the 21st century economic report and other media that after the independence of glory official, almost all supply partners have restored their supply, and there has been no restraint. Suppliers such as AMD, Intel, Samsung, micron, Qualcomm, Microsoft, MTK (United Development Technology) and other suppliers have started cooperation.

After glory and independence, the first step of rebirth has been opened, and the remaining Huawei brand has become a new variable. At present, Huawei mobile phones include mate and P two high-end series brands, as well as nova, maimang and other brands facing the low-end market. Among them, the R & D departments of mate and P series are mainly in Shanghai. Huawei also continues to develop mate 50 internally, but the future of the terminal mobile phone is still affected by many uncertain factors.

Huawei's mobile phone business experienced several twists and turns before it finally broke the circle with its brand. Huawei also really extended from the b-end to the C-end. In the past few years, Huawei's consumer (terminal) business has accounted for half of Huawei's total revenue. In the first half of 2020, Huawei achieved a sales revenue of 454 billion yuan, a year-on-year increase of 13.1%, and a net profit margin of 9.2%. Among them, consumer business income was 255.8 billion yuan, accounting for 55% of the total revenue, an increase of 15.85% over the same period in 2019.

In 2018, Huawei's plan is to achieve a revenue target of US $150 billion by 2023. However, today's global supply chain is changing, and the challenges of consumer business bear the brunt.

In a series of games, supply chain security issues have also been raised to the level of national strategy. Recently, Guangdong and Shanghai "two sessions" have also intensively mentioned various aspects of support for semiconductor and emerging industries.

On October 29, 2020, the Fifth Plenary Session of the 19th CPC Central Committee focused on discussing the outline of the 14th five year plan and the proposed draft of the long-term goal in 2035, and once again raised the scientific and technological innovation to an unprecedented height, and the independent control of key core technologies was emphasized. It is expected that during the "14th five year plan" period, the assessment and support requirements for science and technology R & D investment will be significantly improved, and the new generation of information technology, semiconductor, new energy, medicine and medical and other fields will become the main direction of attack.

During the "14th five year plan" period, Shanghai will strengthen the leading function of high-end industries, promote the scale doubling of the three leading industries of integrated circuit, biomedicine and artificial intelligence according to the industrial development policy of "high-end, digital, integration, cluster and brand", and accelerate the development of six key industries, namely electronic information, automobile, high-end equipment, advanced materials, life and health, and fashion consumer goods We will promote the digitization of economy, life and governance.

Huawei Hubble continues to invest

Since last year, many upstream suppliers have been gradually resuming the supply of Huawei mobile phones, but the supply chain still faces challenges under the "entity list" of the United States.

It was reported that the previous US government had informed several Huawei suppliers, including chip maker Intel, that it would revoke some licenses to sell products to the Chinese company and intended to reject dozens of other applications for supplies to the telecom company.

It should be noted that the companies receiving the notice still have buffer time to respond and appeal. What is mentioned in the report is Intel's "certain licenses". However, Huawei will face a protracted game and test. Huawei and Intel have not responded to the news. It is not clear whether the new U.S. government will continue the policy.

According to the 21st century economic report, both Intel, AMD and Microsoft have obtained supply licenses at the end of 2019, and will not be affected by the new U.S. regulatory measures in 2020.

As far as Intel is concerned, it mainly provides chips for Huawei notebooks and servers. Last September, Intel confirmed that it had obtained Huawei's supply license. Forrest norrod, senior vice president of AMD, also said last year that the company has obtained the license to sell its products to some companies in the "entity list" of the United States, so it is expected that AMD's business will not be affected by the US restrictions on China.

At the end of 2020, a spokesperson for Qualcomm has announced that it has obtained the license to provide 4G products to China, including 4G products, computing products and Wi Fi products. However, Qualcomm has not yet licensed 5g products. Now many core enterprises are applying for supply license. Both MediaTek and SMIC have previously told reporters of the 21st century economic report that they have applied to the US side in accordance with the regulations, and have reiterated that they will strictly abide by the laws and regulations of relevant countries and regions. In addition, TSMC, Meguiar, Samsung, Lianyong and wanghong have also submitted applications to the US side.

On the other hand, in the reconstruction of the supply chain, Huawei is constantly engaged in R & D and foreign investment. Among them, Huawei's Hubble Technology Investment Co., Ltd. (hereinafter referred to as Hubble) has invested in many semiconductor industry chain companies. According to incomplete statistics, more than 20 companies have invested abroad.

In recent days, Hubble is still active. On January 22, Suzhou Jinyi New Material Technology Co., Ltd. changed its business, adding a new shareholder, Harper. The company's registered capital increased from about 146 million yuan to about 152 million yuan. On January 21, Yunnan Xinyao semiconductor materials Co., Ltd. increased its shareholders with an investment amount of 30 million yuan. At the end of last year, Hubble also invested in domestic EDA enterprise jiutongfang microelectronics and Ningbo Runhua all core microelectronics equipment Co., Ltd.

Supporting the growth of domestic semiconductors is not a feat of a day. There is a long way to go. It will be a long-term support for domestic substitutes and even entering the global industrial chain.