The trade war between the USA and China took a new turn this weekend with the news that one consequence of Huawei being placed on an ‘Entity List’ is that Google has revoked its Android license. The Android OS is the dominant smartphone standard outside of the Apple’s iOS, which iPhones operate on.
The development means that Huawei smartphones will now have to rely on the Android Open Source Project, a free version of the OS that doesn’t include many Google apps and services smartphone users have come to accept as standard. Security updates are also rolled out to AOSP sometime after they have been included in the standard, licensed Android OS. This will potentially leave Huawei devices more vulnerable to new security threats.
Google has stated that its move was necessary to comply with U.S. government orders, who placed Huawei on its banned list of foreign companies. The justification for doing so is concerns the company could, on Chinese government orders, include ‘backdoors’ in its technology that would allow for spying. That accusation covers telecoms infrastructure equipment manufactured by Huawei, a major global provider for new 5G networks, as well as smartphone handsets.
It is believed that Huawei has been working on its own OS for some time and may be forced into fast-tracking it into service. However, there is also the possibility that an in-house OS could lead to Huawei smartphones being viewed even more suspiciously than they currently are.
Huawei’s problems do not stop with its use of the Android OS. Chipmakers such as Qualcomm are also suspending shipments of components to Huawei as they wait for clarification on whether the ban extends to hardware products. The company is said to have stockpiled at least 3 months-worth of components and will hope that trade negotiations between the U.S. and China will lead to a resolution.
However, the damage may well have already been done. The Chinese government and the country’s technology giants can be expected to redouble investment in home grown alternatives, cutting trade interdependence with the USA and West more generally. China and its tech companies will move to design their own Operating Systems, chips, semiconductor technology and wider technology standards.
The example has now been set and Huawei and other Chinese companies will now accept they cannot rely upon U.S. and other Western technology partners for key components or services. Bloomberg believes the Chinese government will pump huge amounts of money into ensuring that these home grown products and services will be a match in quality to imported alternatives.
The result could well be a digital iron curtain between China and the West, separating the two regions into distinct schools of exclusive, mutually incompatible technology. It may of course not get that far. But that scenario is now a distinct possibility.Risk Warning:
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