CHINESE ENGLISH
Industry News

Location:Home > News > Industry News... > A trade war between ...

A trade war between China and the United States is a thorn in China is side.

Source:Updated:2018-04-23 08:16:29

Zte became the first target of an accurate "strike" against Chinese technology companies after the British and American methods hit Syria last weekend. Companies selling to China's zte is forbidden in the United States any electronic technology or communication components, this practice brings strong signal: aiming at the high and new technology enterprise of China, we should realize that in many Chinese on the key technology of node still disciplined by others.

The first casualty of a sino-us trade war could be zte, a domestic telecoms firm.

Media news, according to Reuters thereof, the Commerce Department announced on April 16th, will be banned from U.S. companies to sell the Chinese telecoms equipment maker zte any electronic technology or communication component, a ban for up to seven years, until March 13, 2025.

The us Commerce Department said the ban was due to a breach of agreement reached with the us government after it was found to have violated us sanctions against Iran. To make matters worse, Britain's national cyber security centre (NCSC) recently issued new recommendations warning the telecoms industry not to use zte's equipment and services.

Britain and the United States have just struck a precise blow to Syria. Now, with the combined precision of Britain and the us, zte's mobile phone business and AI road could be cut off.

In sino-us trade condition of big background, the domestic technology companies in the United States market every motion are treading on thin ice, although this is take zte operation, but the gun barrel is high-tech enterprises such as huawei, we should be aware that China still had on many key technology node, model innovation will have an end, competition between countries, not by who order takeout, is to rely on science and technology, hard power!

Zte crisis: upstream electronics technology, communications components are banned, previously paid 8. $900 million fine

Zte's crisis is sudden and inevitable.

Last year, zte pleaded guilty to a federal court in the United States, admitted its violation of sanctions against Iran in the United States, illegally carrying the commodity and technology to Iran, zte reached a settlement with the U.S. government at that time.

According to the settlement, zte paid the U.S. government 8 in March 2017. It was fined $900 million and faced additional penalties of $300 million. In a plea deal, zte agreed to fire four senior executives and punish 35 others.

But the us department of commerce, a senior official said on Monday that zte does not implement the relevant punishment measures, zte only fired four senior managers, not for other 35 employees to disciplinary action or bonuses.

The us said it could no longer trust zte's commitments and issued a ban.

In the last two years, zte has suffered several crises in the United States, but this is the biggest crisis that zte has encountered in the United States.

 

Make zte to make matters worse, a loyal ally of America's Britain also join a series of precision for zte suppressed, the British national cyber security centre (NCSC) issued a new suggestion, warns the telecom industry with zte equipment and services.

The double whammy of the us and UK could spell doom for the country's leading telecoms firm. Zte's H shares and A shares were suspended from trading today, and the announcement said zte had been informed that the us department of commerce had refused to activate the company. The company is fully evaluating the possible impact of this incident on the company, and actively communicating and responding to all aspects.

In response to the us Commerce Department's ban on zte, a spokesman for China's ministry of commerce said: "China has taken note of the announcement by the us department of commerce of measures to export control of zte."

China always requires Chinese enterprises to abide by the laws and policies of the host country and conduct business in accordance with the laws and regulations of the host country. Zte and hundreds of U.S. companies have conducted extensive trade and investment cooperation, contributing tens of thousands of jobs to the United States. It is hoped that the us will properly handle the issue according to law and create a fair, fair and stable legal and policy environment for the enterprise.

The ministry of commerce will keep a close eye on the situation and stand ready to take necessary measures to safeguard the legitimate rights and interests of Chinese enterprises.

Zte's supply chain is cut off, the AI road may be broken, and huawei is on thin ice.

The us Commerce Department's ban on zte was a huge blow to zte.

Qualcomm, Intel, Microsoft and dolby zte equipment are the main providers, if there is no qualcomm build a platform for the mobile processors, zte will have a hard time in the United States production of mobile phones, expects zte released in the United States Axon 9 cell phone plans will be affected, the device adopts the qualcomm Xiao dragon 845 chip.

AndroidAuthority estimates that 25 to 30 per cent of zte's components come from the us, and it takes time to find new suppliers for these components, and zte could hardly sell anything before that. China merchants securities analyst Fang Jing in electronics industry analysis, zte need high speed AD/DA, modulator, high-performance phase-locked loop, intermediate frequency VGA, and other products, there is no domestic chip manufacturers can offer alternatives.

In addition, although the years zte gradually disappeared in the domestic mobile phone market, but in order to avoid the status of pipelining, zte quietly layout of artificial intelligence, beginning in 2015 for the next generation of network intelligent requirements more and more strong.

According to the zte research report issued by guosen securities in September last year, zte has a comprehensive layout of the platform + cloud pipeline to help operators grasp the intelligence of the network. "Zte artificial intelligence platform with NVIDIA gpus, etc of building high performance cluster" container "in chips and terminal: have brains intelligent robots, smart phones, optimization, home intelligent terminal (including the latest IPTV), etc."

Handset or AI research and development, zte high reliance on American industry chain upstream, once sanctions, let alone seven years ban, even a year ban, zte will carry not to live.

Zte is a representative of the era of "China cool", and the company is not in a good position.

 

In this year's CES, the company officially announced huawei Mate 10 Pro to enter the U.S. market.

Previously, the federal communications commission (FCC) has spread to parts procurement of huawei, zhongxing telecom network equipment operators to take measures in the United States, although the news was huawei denied, but under the background of sino-us trade tensions, huawei is likely to be the most vulnerable in a trade war, before the ban huawei, Verizon, AT&T, best buy has illustrates this point.

This morning, shares of haikang and dahua fell sharply, and investors may be concerned that the company is facing a similar export control problem. However, in addition to AI chips, the security industry has a low dependence on U.S. components, and investors need not worry too much. But in the context of sino-american trade tensions, China's high-tech companies are skating on thin ice every step of the way.

The trump administration "killed one thousand people and lost eight hundred"?

It is not just zte that has been affected, and some American companies have suffered.

First, components manufacturing enterprises.

Acacia communications, a boston-based communications component maker, plunged 35 percent after the ban was issued. Shares in Oclaro, a provider of telecommunications and digital optical devices, modules and subsystems, also fell 15 percent. Shares of Inphi, a telecommunications semiconductor provider, fell 6 percent, and fiber production and seller Lumentum Holding fell 9 percent. 1%.

 

The company's shares plummeted 35 percent. 97%

According to the Investors website, Acacia's components business relies heavily on zte, which contributes 30% of its sales; Lumentum's sales in zte range from 5% to 10%, and Oclaro is 17. 5%.

For America's chip companies, it is not just the fall in share prices.

Zte is heavily reliant on qualcomm chips, and the ban will directly cost the company a big customer. More importantly, qualcomm is now ready to apply to the Chinese regulators to acquire wisdom pu, at present, China is the only not signed qualcomm acquisition state of pu plan, the application may with the approval of the six months time.

 

Reuters reported that qualcomm is preparing to re-apply to the Chinese regulator for the acquisition of nzhipu.

Previously, the company had been banned by Mr Trump, citing concerns about China's security problems. The tables have turned, now the high grace to China to apply for purchase of pu, it makes qualcomm more pinched the 1: China is likely because of a trade war and zte events and opposed the acquisition.

Longer term, according to the U.S. department of commerce the ban on zte, China is also likely to take countermeasures, limit qualcomm enterprise such as the United States, but the end of this may not be the best.

Outside the hardware business, software companies are also doomed.

The ban covers "any commodity, software or technology" exported from the us, which means zte may not be able to use most of Google's applications. Based on the prohibited items, Google will no longer be able to with the zte business relations, and zte mobile phones also can not be seen as Android certification, if you can't be Android certification, zte's any cell phone can't gain market recognition.

 

The company USES zte's phone, which is made from the glass of corning gorilla glass.

Currently, zte is listed as a certified Android device, and GuGe says it is "tested for safety and performance and pre-installed Google applications". Including GuGe Gmail, GuGe Play store, GuGe map and other software. These are governed by the mobile application distribution protocol or MAPA, which is a contract between GuGe and equipment OEM.

In addition, the corning gorilla glass used in zte's phones will also be limited.

Deep fear: worry about China 5G; Need to rise: China's core component makers such as chip need to be stronger!

At the U.S. department of commerce of zte's ban issued recently, the American association of wireless communication and Internet (CTIA) released a report, called "Race to 5 g," said in a report, China's aggressive on the layout of the 5 g, if America does not release more "middle frequency band" as soon as possible, China will win the competition 5 g.

The report compared 10 countries to indicate which countries are currently leading the race for 5G. The report also compiled an index measuring the progress each country has made in promoting 5G spectrum and infrastructure policies, as well as the industry investments needed to win 5G technology.

 

The report's main findings:

China, South Korea and the United States are ahead of 5G, and China's lead is small.

America's 4G leadership has led to growth in other countries' economies and jobs.

The loss of wireless leadership in 3G and 4G has a significant and long-term negative impact on the telecommunications industry in Japan and Europe.

The U.S. wireless industry is a global leader in the commercial investment and necessary preparation for 5G deployment.

Europe led the world by 2G and Japan by 3G. In 2010, the us won 4G competition. Today, the U.S. wireless industry supports more than 4.7 million jobs, contributing $475 billion a year to the economy.

Once lost, 5 g of competition for the wireless industry in the United States and more likely to be a profound economic have a great negative impact, this is the government to reject trump broadcom acquisition of qualcomm, block huawei mobile phone sales in the United States, it is forbidden to the deep reasons behind zte export products.

But for the enterprise, 5G is the big potential that can be foreseen, which is also what the communication industry must do, which cannot avoid the competition. For zte, and China mobile phone manufacturer, American manufacturers in high performance analog devices (including rf devices), the FPGA and EDA tools in areas such as lead, a product suddenly break for these areas, can cause the enterprise to suspend production. So supply security is not about whether a product is at the top end of the spectrum, depending on whether you can design it.

Zte was hit after a precise, hope to have true love in this industry, the industry starts from the most basic components, even the old power supply, AD/DA, phase-locked loop and MCU, as long as the performance of "high-end" and can walk out of the PPT to realize mass production, can replace imported chip, large-scale industry, can help solve domestic system manufacturers set around the neck rope!

 

Huang wei, founder and CEO of cloud knowledge, also commented in a circle of friends:

When China and the United States fought a trade war, and the United States took huawei zte, we finally found that we were under the control of people on many key technology nodes. The model innovation has an end, the competition between countries, not depend on who order to take out more, still rely on hard technology after all, hard power! Although we started, we are still weak, but we will grow up.

This trade war will also make some investment institutions more aware of the value, technical value, and team value of truly core technology companies, not necessarily by the current Numbers. By delivering food, we can never win the competition of the future.

Product|Technical|News|Propaganda|Partner|About

Copyright © 2014 Quanstar Intelligent Controls(shanghai)Co.LTD All rights reserved ICP: Shanghai ICP No. 10214886

Address: 152 Ring Road, Shanghai Comprehensive Industrial Development Zone

Tel: 021-57472600    E-mail:Mark.liang@quanstar.cn

Website buildingTrueland