Huawei, the Chinese tech giant that has been under US sanctions for years, has surprised the world with its new Mate 60 series of smartphones, which reportedly feature 5G support and a chip made in China that was thought impossible without access to restricted western technology. The launch of the Mate 60 and Mate 60 Pro, which took place without much fanfare in China last week, has raised questions about how Huawei managed to overcome the US restrictions and what it means for the global chip industry and the ongoing US-China tech rivalry.
Huawei’s breakthrough chip
According to TechInsights, a Canadian analysis firm that specializes in reverse engineering chips, the Mate 60 series is powered by a new Kirin 9000s chip that was made in China by Semiconductor Manufacturing International Corp (SMIC), the country’s largest chipmaker. The Kirin 9000s is built on 7 nanometre (nm) architecture, which is the most advanced technology currently available for smartphone processors. The chip also has a modem that can connect to 5G networks, making it the first Huawei smartphone in three years to have this capability.
The Kirin 9000s chip is a remarkable achievement for Huawei and SMIC, considering that the US has restricted Huawei’s access to chipmaking tools essential for producing the most advanced chips. Since 2019, Huawei has been unable to procure chips from its previous supplier, Taiwan Semiconductor Manufacturing Co (TSMC), which uses a process called extreme ultraviolet lithography (EUV) to make 7nm chips. The US has also barred SMIC from obtaining the necessary machines from ASML, a Dutch company that is the sole supplier of EUV equipment.
TechInsights said that SMIC was able to produce 7nm chips by tweaking simpler machines that it could still purchase freely from ASML. However, this method is likely to have lower yields and higher costs than using EUV, and it may not be able to keep up with the demand for Huawei’s smartphones. Some research firms have forecast that only 50% or fewer of 7nm chips produced this way would turn out to be usable, versus the industry norm of 90% or more.
Huawei’s comeback in the smartphone market
The Mate 60 series marks Huawei’s comeback in the smartphone market, which has been severely affected by the US sanctions and the Covid-19 pandemic. Huawei was once the world’s largest smartphone maker, but it fell to seventh place in the second quarter of 2023, according to IDC. Its global market share dropped from 20% in 2021 to 9% in 2022, and it sold its budget smartphone brand Honor to a consortium of Chinese companies in late 2021.
The Mate 60 series could help Huawei regain some of its lost ground, especially in China, where it still has a loyal customer base and strong brand recognition. The Mate 60 Pro is priced from 5,999 yuan ($817.70), the same as Apple’s iPhone 14 in China. It has a 6.8-inch OLED display with a variable refresh rate of up to 120Hz, a glass back with a two-tone finish, and a triple-lens rear camera system with a variable aperture between f/1.4 and f/4.0. It also has a unique feature that allows users to place calls or send messages via satellite communications in areas where there are no mobile signals or internet.
The Mate 60 is a pared-down version of the Mate 60 Pro, with a smaller battery, slower charging, and no facial recognition system. Both models run on Huawei’s own operating system HarmonyOS, which is compatible with Android apps but does not have access to Google services such as Gmail, X Maps, and X Play Store. Instead, Huawei offers its own app store called AppGallery, which has more than 600 million monthly active users globally.
Huawei’s impact on the US-China tech rivalry
Huawei’s launch of the Mate 60 series also coincided with the visit of US Commerce Secretary Gina Raimondo to China earlier this week, where she met with Chinese Vice Premier Liu He and discussed trade and economic issues. Raimondo said she raised concerns about China’s unfair trade practices and human rights violations, while Liu said he hoped the US would respect China’s core interests and create a fair environment for Chinese companies.
Huawei has been at the center of the US-China tech rivalry for years, as the US has accused it of posing national security risks due to its alleged ties to the Chinese government and military. Huawei has denied these allegations and sued several countries for banning its products from their telecom networks. The US has also sought to extradite Huawei’s chief financial officer Meng Wanzhou from Canada on charges of violating sanctions on Iran.
The US sanctions on Huawei were intended to curb its technological ambitions and prevent it from dominating the global markets for 5G equipment and smartphones. However, some analysts have argued that the sanctions have backfired and spurred China to invest more in developing its own chip industry and reducing its dependence on foreign suppliers. China has launched a new state-backed investment fund that aims to raise about $40 billion for its chip sector, and it has also supported domestic chipmakers such as SMIC and HiSilicon, Huawei’s chip design arm.
Huawei’s new Mate 60 series shows that China has made some progress in overcoming the US sanctions, but it also faces many challenges and uncertainties in sustaining its chip production and smartphone sales. The US may impose further restrictions on Huawei and SMIC, or take action against other Chinese tech companies such as Xiaomi and ByteDance. Huawei may also struggle to compete with other smartphone makers such as Samsung, Apple, and Xiaomi, which have access to more advanced chips and a wider range of apps and services.
