"SINGAPORE -- Huawei Technologies plans to roll out its most advanced domestically made phone chip, people familiar with the matter said, showing how the company is able to make strides in semiconductors despite U.S. sanctions.
The chip is set to be included in some phones of the Mate 70 series to go on sale next week, they said. With the series, the Chinese smartphone maker hopes to challenge Apple and build on market-share gains since last year. The iPhone maker still counts China as its second-largest market after the U.S., but after years of dominating high-end phones it has faced growing competition from Huawei.
In recent days, Huawei has given glimpses of the Mate 70 series online, including showing three camera lenses on the back of the phones, and the company said it would make a product announcement on Tuesday.
Huawei hasn't given details of the phones' features or the chips inside them -- an area of interest for U.S. policymakers who have sought to hold back Huawei's technology. The company was put on a trade blacklist during the first Trump administration in 2019.
A Huawei representative declined to comment on the chips in the new phones.
The company's ability to continue making incremental advances in semiconductors is both a security concern for the U.S. and a commercial challenge for Apple. Huawei's overall market share in China has risen to 15.3% in the third quarter of this year from 8.6% in the first quarter of last year, according to industry researcher IDC, and it has been neck-and-neck with Apple in recent quarters. Huawei's fortunes have improved in part because of nationalistic buying by Chinese consumers and because of features including its powerful cameras.
The two companies compete in particular in the high-end market. Huawei's current flagship model line, the Mate 60 series, starts at $690 in China, while Apple's iPhone 16 series retails for about $830 and up in China.
"The Mate 70 will continue to put more pressure on Apple in China," said IDC Vice President Bryan Ma. While Huawei's chips still trail Apple's, particularly in power efficiency, "this might not amount to much of a practical difference as long as the user is able to get through the day without having to worry about charging," he said.
Huawei is taking preorders in China for the Mate 70 series and said on its website that around 2.5 million people have clicked a button online saying they intend to purchase the device, although they can change their minds later.
Huawei has sidestepped U.S. sanctions with domestic technology. When Google cut access to some of its Android services on Huawei smartphones, the Chinese company developed its own operating system called HarmonyOS Next. The coming Mate 70 series, which has three models, will use that software, the people said.
In August 2023, Huawei surprised U.S. officials by introducing its Mate 60 series of smartphones with communications capability similar to high-speed fifth-generation phones available in other countries, even though it could no longer access 5G-related technology from the U.S." [1]
Sanctions are considered a powerful economic weapon. In politics, sanctions trigger a wave of nationalism in the sanctioned state and powerful resistance to the lovers of sanctions. Sometimes this has economic consequences, as in the case of the iPhone.
1. Huawei Steps Up Challenge To iPhone. Lin, Liza; Huang, Raffaele. Wall Street Journal, Eastern edition; New York, N.Y.. 22 Nov 2024: B.1.
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