In 1987, Huawei was introduced to the world by founder Ren Zhengfei as a phone switch manufacturing company. As the years passed, Huawei expanded its business exponentially, adding mobile phone creation and distribution to its repertoire. However, 2018 and 2019 have not been kind to the company. With US President Donald Trump having blacklisted Huawei from US communications networks, the future for Huawei mobile users seems bleak.
The Case of Huawei in the “Entity List”
In just a year, Huawei went from thriving to struggling. Although the company has been under pressure for a time due to spying allegations, its troubles peaked after the implementation of Trump’s trade blockade. It added Huawei to the “Entity List” of the US Commerce Department, banning it from buying technologies from American companies.
One of the most setbacks following the trade ban is when Google cut ties with the company on May 19, 2019. The move effectively cut the Chinese company off from future Android updates.
Behind the Huawei Controversy
To get a good understanding of what has happened to Huawei the past year, it’s important to take note of the line of controversies that led to Huawei’s current state. It goes as far back as early 2018.
The earliest high-impact loss that Huawei experienced was AT&T support. Huawei CEO Richard Yu fully admitted that the deal they had with AT&T had failed, which means that AT&T will not sell their phones at all.
Later in March of the same year, Huawei loses Best Buy as a retail partner. Two months later, the US banned Huawei for the use of military personnel, particularly for those working in the Pentagon. The move addressed reports of personal data breaches among users from as early as 2012.
It didn’t make things better for Huawei in September 2018, when it was caught cheating on a phone benchmark test. In December 2018, Huawei’s Chief Financial Officer (CFO), Meng Wanzhou, was arrested in Canada for doing business in Iran against US sanctions. She was eventually released on bail amounting up to $10 million.
January was a particularly tough month for Huawei. Reports that the Trump administration may issue an executive order to ban the purchase of Huawei and ZTE products came out. This led to a discussion amongst US senators about the concern behind Chinese tech companies overall, which then led to the introduction of a bipartisan bill.
Tensions ran high between China and Canada as the arrest of Huawei’s CFO, as well as the subsequent arrest and detainment of two Canadian citizens. Huawei’s CFO faced potential extradition to the US. Meanwhile, various colleges around the US have dropped Huawei equipment from campus use.
On March 1, 2019, the order to extradite Huawei’s CFO to the US was formally approved. A week later, Huawei sues the US government over the massive equipment ban.
Fast forward to May 15th in which President Donald Trump formally announced a ban on Huawei. It is reported that in the next 150 days, the US government will be making the necessary steps to ensure full implementation of the order.
Its Implication on the Customer Base
Since President Trump has blacklisted Huawei from its shores, Huawei users are concerned about the effects of the blockade to their devices. With the limited systems that Huawei is running on and its attempts to find and create alternative solutions in the wake of the ban, only time will tell if the Chinese company will be able to make a comeback.