iPhone versus Huawei battle; US National Security Advisor speaks

The iPhone versus Huawei battle is back on in China, following the launch of the Mate 60 Pro (yeah, that’s not an iPod, despite appearances). Sales of the Chinese company’s smartphones plummeted last year, after US tech sanctions blocked it from purchasing 5G radio chips.

The fact that Huawei has now solved this problem has raised a lot of eyebrows, including those of the US National Security Advisor, who commented on it during a recent White House press briefing …

The long-running iPhone versus Huawei battle

Sales of Apple and Huawei smartphones were both neck-and-neck and relatively low until the launch of the iPhone 6 in 2014. This was the point at which Apple first made a larger-screened iPhone in a market that very much favored them.

The success of the iPhone 6 and subsequent models spurred Huawei to up its own game in the premium segment, and a combination of patriotism and lower price saw Huawei rapidly achieve dominance in the Chinese market. Huawei’s lead peaked in 2020, driving down iPhone sales in the process.

US tech sanctions hit Huawei hard

All that changed last year, when the US government imposed sanctions on China, preventing the export of advanced US chips to the country. Among other things, that blocked Huawei from buying 5G radio chips for its smartphones from Qualcomm and Broadcom.

You can’t expect to sell many premium smartphones without 5G capabilities, so that saw sales of Huawei phones drop like a brick, with Apple by far the biggest beneficiary.

Counterpoint data shared by the Financial Times shows just what a dramatic turnabout that was:

As the graph shows, however, things are now beginning to change again. That’s because Huawei managed to source home-grown 5G chips for its latest smartphone, the Mate 60 Pro, from the Semiconductor Manufacturing International Corporation (SMIC). That means the iPhone versus Huawei battle is now very much back on.

Nobody in the tech sector understands how China was able to make its own 5G chips. This is still an advanced tech believed to be beyond the capabilities of Chinese chipmakers.

Even US National Security Advisor Jake Sullivan expressed surprise about this when questioned about it during a recent White House press briefing.

Q: Huawei has reached a breakthrough with its new smartphone and shows it’s using the most advanced chips produced by Chinese chipmaker SMIC. I’m wondering how concerned you are about this development. And does it prove that the U.S. export controls are failing or that they’re violating those export controls?

A: I’m going to withhold comment on the particular chip in question until we get more information about precisely its character and composition […] But in terms of characterizing the chip in question, that’s something that we need to gain more information from.

If investigations do reveal any sanctions-busting, that could end the battle right there.

The Chinese government appears to be doing its own bit to help Huawei as it seeks to send a message to the US government.

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