Chip designer Arm ditches Huawei because of Trump ban

But all licenses already signed will still be in effect, which means Huawei can build its own chips for several years to come.

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The Trump administration has banned US companies from working with Huawei. 


Chip designer Arm has become the latest company to cut ties with Huawei to comply with a Trump administration ban. 

But Arm will keep supporting older products, and previously signed licenses likely make it possible for Huawei to build its own Arm-based chips for years to come. The Chinese company likely won't see a huge impact unless the ban lasts for years. 

Arm is a UK company whose designs are the basis for most of the world's mobile processors, including those used by Apple, Samsung -- and Huawei. Its key place in the industry attracted Japanese telecommunications giant SoftBank, which bought Arm in mid-2016 for about $32 billion (£23 billion, AU$40 billion). Nearly 150 billion Arm chips have shipped since the company was founded three decades ago.

Watch this: What is going on between Huawei and the US?

Companies license Arm's technology to serve as the core of their chip designs. Qualcomm's Snapdragon lineup, Samsung's Exynos chips, Apple's A-series processors and Huawei's HiSilicon semiconductors are all based on Arm's chip architecture. Without access to Arm technology, they'd be forced to create the technical designs on their own, which would be expensive and difficult. 

While Arm isn't headquartered in the US, it does most of its high-end processor R&D there. Any intellectual property designed in the US falls under the Trump administration's ban, which is why Arm must follow the order. The company said in an initial statement that it is "complying with all of the latest restrictions set forth by the US government."

It later added that it "is having ongoing conversations with the appropriate US government agencies to ensure we remain compliant. Arm values its relationship with our longtime partner HiSilicon and we are hopeful for a swift resolution on this matter."

Huawei, meanwhile, said in a statement that it values its "close relationships with our partners," but recognizes "the pressure some of them are under, as a result of politically motivated decisions. We are confident this regrettable situation can be resolved and our priority remains to continue to deliver world-class technology and products to our customers around the world."

ReadHuawei could survive without Android, but not very well

Cutting Huawei off

An executive order signed by President Donald Trump last week cut Huawei off from longtime business relationships that give the Chinese brand access to technology made by US companies. That included Google's Android mobile software and its services like Gmail, Google Assistant, the Google Play store, Google Maps and Google Search. Chip suppliers like Intel, Qualcomm and Broadcom also are complying with Trump's ban. Japanese firms Panasonic and Toshiba have reportedly stopped supplying Huawei with some electronic equipment that may include US parts or technology.

While some companies, like Google, were granted a 90-day reprieve to keep working with Huawei in a transitionary period, that doesn't apply to Arm or other chipmakers. 

"The license only allows continued exports of parts for servicing related to existing (as of May 16, 2019) networks and handsets, not exports for new products," the Semiconductor Industry Association said Wednesday in a statement. "No new sales to Huawei for new equipment are permitted. As a result, the license offers only very limited relief to suppliers of Huawei, including US semiconductor companies, as the majority of their business with Huawei involves sales for new devices."

While Arm can't provide new technology to Huawei because of the ban, its earlier licenses cover technology that will be released in the future. When Arm introduces new processor architecture, it typically will have started working with licensees on the technology two or three years prior. Huawei would have had access to not-yet-announced Arm IP years before the ban. 

Arm also will continue to support Huawei with the Arm technology that Huawei has access to now. 

The BBC earlier reported the news

Originally published May 22, 5:52 a.m. PT.
Updates, 9:55 a.m.: Adds Huawei comment and additional information; 12:17 p.m.: Includes additional Arm comment and information. May 23: Adds that Panasonic and Toshiba are halting some business with Huawei.