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| Huawei is focusing on the cloud business to ensure its survival |
According to a British Financial Times report, Chinese telecommunications equipment company Huawei will focus on the emerging cloud sector. Despite Huawei being punished, it can still use the US chips to ensure its survival.
The newspaper reported that Huawei's cloud business has sold the company's computing and storage capacity, including permission to use artificial intelligence.
Huawei's cloud business is behind Alibaba and Tencent, but it's growing fast. In January, Huawei compared the division with smartphone and telecom device companies.
Cloud activities are vital to Huawei's stability in the domestic market. Because Beijing will increasingly support companies through public cloud contracts.
It is necessary to change the focus. The outlook for Huawei smartphones and other consumer products is poor due to the US ban, and the ban prevents them from using mobile phone chips.
At the same time, industry executives and analysts said: Suppliers of semiconductors needed for cloud computing are allowed to continue to supply Huawei while other components are available in the open market.
Intel is the main supplier of Huawei's server processors as they were licensed last year and can still be sold to Huawei.
Hundreds of companies have applied for temporary licenses after the US Commerce Department added Huawei to its list of companies banned from doing business with US companies last year.
Although the United States government has regulations prohibiting the sale of chips designed or manufactured with US technology or equipment for transactions involving the United States, these licenses remain in effect.
A US Commerce Department official told the Financial Times that Al Qaeda has no influence on licenses issued before August 17, and the scope of the rules has not changed to include previously issued licenses.
Over the past year, most of the companies that have applied for temporary licenses have focused on designing chips and software. Since the industry does not expect Washington to crack down on the entire supply chain, this includes manufacturing.
The exceptions to these Huawei providers no longer make sense. Because the latest rule prevents chip manufacturers from shipping to Huawei.
However, some chip manufacturers have already been licensed, including Intel, and the Commerce Department has not disclosed which companies have been licensed. However, Intel has confirmed that it has a license to ship to Huawei.
While Intel processors can still be used, Huawei can instead use Kunpeng and Ascend.
Huawei Cloud processor was developed internally based on the design of the British chip maker ARM. The chip could not be manufactured due to the recent ban.