Chip Designer ARM Has Cut Ties With Huawei, Dealing A Deadly Blow To Company's Future

UK-based processor manufacturer ARM, one of the biggest names in the business, has severed business ties with Huawei. This is just a few days after other US-based chipmakers announced they were stopping supplies to the Chinese company.

The move could spell the end for Huawei.

Citing internal company documents, multiple reports claim that ARM has instructed employees to halt "all active contracts, support entitlements, and any pending engagements" with Huawei and its subsidiaries. It's not just another company piling though. Rather ARM, which is owned by Japan-based SoftBank, indicates in the document that its designs feature technologies of US origin.

These companies are all just falling in line with the US government order earlier this year, banning local companies from having any dealings with Huawei. It's all part of a US-China trade war that has seen president Trump flexing his muscles.

Previously, Google had announced it was revoking its Android licence from the company's smartphones. Later Intel, Qualcomm, and Broadcomm also pulled their chip licences, as did Microsoft with Windows permissions. This is all a huge problem for Huawei.

Without Intel or Microsoft, Huawei can't manufacture any more laptops. And without ARM and Google, Huawei will be hard-pressed to build smartphones. Though the company has been working on its own chips and OS, there's no telling how long that will take to complete.

Additionally, ARM processors are used in everything from IoT devices to the sensors within a smartphone. So it's likely Huawei's chips were based on their architecture, which they therefore can't use now. Essentially, their plan B is now worthless. Even if they have enough time to eventually come up with a new chip architecture of their own, that won't necessarily even be compatible with open source versions of Android either.

That basically leaves Huawei without any income from its products, which were its biggest, and arguably only significant revenue source. Even their datacentres are affected by the ban.

This could effectively be the beginning of the end for Huawei, at least unless the US decides to reverse this ban. And that means they first have to make nice with China despite this trade war, which experts aren't necessarily hopeful about. Otherwise, we may have seen the last of Huawei and Honor smartphones for good.