The US government announces changes to export rules that require any foundry using US technology for chip manufacturing to ask for permission from the US before shipping components. This is coming exactly about a year since Huawei was placed on the ‘Entity List.’
The scope of the regulatory changes have recently expanded to include all chips. This means, companies such as TSMC where Huawei is the second largest customer after Apple, can not ship the 5nm Huawei Kirin chipset to Huawei after the 2nd week of September. This will clearly inflict much pain on Huawei, if there’s no availability for cutting-edge chips to power up high-end phones such as Mate 40 and its 5G base stations.
Reuters on Friday, reported that the Taiwan-based chip maker, MediaTek has requested U.S. permission to supply Huawei with chips. MediaTek in an official release stated its respect in obeying relevant orders and rules with regards to global trade, and that requests has been sent to seek permission from the US government in accordance with the requirements.
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Huawei has tried to do business with China’s largest foundry, SMIC, but the company is at least a couple of process nodes behind TSMC. TSMC sent Huawei Kirin chips made using the 5nm process earlier this year, with each chip containing 171.3 million transistors per square mm. In comparison, chips made using the 14nm process with a transistor density of 43 million transistors per square mm is the best SMIC can deliver at the moment. SMIC uses this node to help build the Kirin 710A chipset announced last May.
With Huawei considered by the US as a threat to national security, MediaTek’s request for permission to manufacture cutting-edge chips for Huawei, will probably be rejected. The Chinese manufacturer was the top phone manufacturer in the world, and was second to Samsung in the Q2 2020. They are also the largest supplier of networking equipment in the world during the second quarter.
The Mate 40, which is Huawei’s most technologically advanced smartphone line, will probably undergo mass production this month. A lot of pressure will be taken off Huawei, if MediaTek succeeds in getting permission from the US to ship chips, especially when you consider the current situation.