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A move to ban exports of US technology to Huawei is by far the most serious blow against the company yet. Key suppliers, including Google and ARM, have announced plans to suspend business with the company, and experts are speculating about the company’s survival. As the TechNode community gathered in Shanghai for our first Emerge conference, I had the chance to ask the $105 billion (in 2018 revenue) question: Can the company survive without US technology? Bottom line: The consensus view is that losing access to US technology would mean Huawei is living on borrowed time. While the company can continue to produce present-day products indefinitely, it cannot design new microchips without access to critical architectures. This will leave the company’s products stuck with today’s designs, making the company increasingly uncompetitive if the ban lasts. The key unknown is whether it will last. What’s banned: Huawei has been placed on the US “entity list,” declaring it to be “involved in activities contrary to the national security or foreign policy interests of the United States” and requiring companies to seek special licenses to sell it US technology.

Achilles’ semiconductors: What makes substitution impossible, Emerge attendees said, is semiconductors. Two key types of microchip architecture licenses are needed for all of Huawei’s main business lines.

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David Cohen

David Cohen has covered China stories since 2010 as a writer and editor.