But the sanctions also cut off HiSilicon from the global network of factories (called "foundries" or "factories" in the semiconductor industry) needed to manufacture and test products. Taiwanese chipmaker TSMC, which at the time produced chips for HiSilicon, will stop supplying them in 2020.
This further narrowed Huawei's options. This could only be applied in Chinese factories and was a long and expensive process. "Whenever you design a chip at Fababorb and for whatever reason you can't get it and you can't go to another company, the redesign, qualification and ramp-up process takes time, at least three years," says Krishnaswamy. . He owns a chip company that works closely with factories.
Further complicating the situation for Huawei is the fact that Chinese chip factories have switched to advanced chip manufacturing technology.
And when Huawei released a smartphone with a new 5G chip earlier this year, Krishnaswamy said he was surprised at how quickly the industry could change designs by going to a Chinese factory to make and ship the new chip. Production volume in the face of significant revenue loss due to sanctions. "It's amazing that Huawei can do this," he said.
In fact , the company has become a source of national pride for many Chinese residents , as it is rumored to be producing its own 5G chips with minimal investment in Chinese factories. For them, this is an example that US sanctions do not always work as intended. They force Chinese companies to adapt, bring manufacturing back to China, and catch up in technological areas where they are lagging behind, ultimately benefiting China.
Still, it's too early to be complacent, as there are other hurdles before Huawei can become competitive again in the high-end phone market.
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