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Google has reportedly suspended some of its business with Chinese tech giant Huawei after US President Donald Trump added Huawei to a US trading blacklist.
Huawei Loses Access to Proprietary Android OS, Play Store
A new report from Reuters today says that Google has cut some business ties to Chinese tech giant Huawei following the US government placing the company on a trade blacklist.
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The Trump Administration added Huawei to the blacklist on Thursday, placing immediate restrictions on the company that severely restrict the ability of other businesses to work with them. These restrictions appear to be driving Google's decision to cut some ties with Huawei, specifically any business that provides Huawei access, technical support, and other arrangements around Google popular line of apps and its Android mobile OS.
The move doesn't appear to have come as a surprise to Huawei, who has been working on developing its own software and technology in case the US succeeded in chasing off potential business partnerships.
"No matter what happens, the Android Community does not have any legal right to block any company from accessing its open-source license,” said Eric Xu, the rotating chairman of Huawei, in an interview with Reuters in March.
Owners of Huawei devices running the Android OS will continue to have access to Google App Updates through Google Play, but future Huawei devices will not be able to download these apps from the app store. While Huawei can still run the open source Android OS on their phones through Google's open source license, but this does not cover the use and access to Google's line of apps, which requires a separate business agreement which Huawei will no longer be able to get.
Impact of Blacklist Limited in China, Business in US and Europe Will Suffer
The impact of the blacklist will likely be limited in China, Huawei's biggest market, as a majority of Google's apps are already banned in China and competitor products from Weibo and Tencent have a position of market dominance.
The sale of Huawei's devices in the US is already restricted, so there isn't likely to be any real harm on revenue from sales in the US. The primary concern for Huawei will be the company's global supply chain, which will have to revisit whatever arrangements they have with the company to avoid running afoul of US restrictions.
Another important factor is the company's presence in Europe, it's second largest market. Unlike in China, Google's App line-up is popular in Europe and customers might decide to take a pass on Huawei's products if they cannot access products like Gmail and YouTube. “Having those apps is critical for smartphone makers to stay competitive in regions like Europe,” said Geoff Blaber, CCS Insight's vice president of research.