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Tripling Russia phone sales to 37% share

When Ren said that the US attack had inspired Huawei people to work even more effectively, most took that for bluster. But the results are coming in, including a remarkable increase in sales in Russia, a large market.

Huawei also is building a 5G network for MTS, agreed shortly after the meeting between Putin & Xi. Russia, which has the lowest mobile prices in Europe, had been holding off on 5G until 2021.

Huawei is investing massively in several new research centers in Russia, Ren noted that Russian universities consistently won international prizes in computer science. Google and the other Americans grab the best graduates. Huawei intends to change that, including by making much higher salary offers.

The sales increase in Russia, China, and the rest of the world is more than making up for the sales lost to the Google blockade.

Huawei’s phone sales up 29% Q3

Huawei sold 67 million smartphones in Q3, 18% of the world market. Samsung is ahead at 22% but the gap is narrowing quickly. The US boycott is having some effect, especially in Europe. Otherwise, Huawei would be on track to catch Samsung at the end of this year.

After two years of stagnation, smartphone sales climbed by 2%. The figures are from Strategy Analytics, a respected source. (Full release below) The boom in China 5G is key to Huawei’s success.

Apple and almost everyone else saw sales drop. Apple is confident they will sell 80 million 5G phones, although they probably won’t launch until September.

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Huawei Sales Q3 +27%

It’s all over but the shouting. Huawei will survive and thrive, no matter what the US does short of bombing Shenzen. Despite the US blockade, Raymond Zhong of the NY Times calculates Q3 sales were up 27% over the previous year. I expect 2019 sales will be about US$120 billion.

“Sales from January to September were $86 billion, an increase of nearly 25 percent from a year earlier, Huawei said. That implies, based on comparisons with previously released figures, that sales accelerated in the July-to-September quarter.”

Zhong notes you have to go beyond the (limited) financial release/

It can also be selective about which numbers it shares … the company did not offer a breakdown of its latest sales for different business divisions, which would have provided a better sense of how it has been dealing with the American blacklisting.

I have some details for Zhong. Ritchie Peng said Huawei has now shipped 400,000 5G radios, billing over several quarters billions. He added the demand was far beyond expectations.

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Radio frequency for phones: Huawei doesn’t need U.S.

Donald Trump and others in D.C. are completely certain Huawei needs parts from America. That’s total hubris. Huawei designs its own custom chips for mobile, led by the Kirin 980 & 990. Screens, power supplies, and just about everything are available outside the US.

The one major exception – until now – was RF (radio frequency) parts. 5G phones must support over two dozen frequency bands. They must filter out unwanted signals, perform error correction, and amplify what often will be very weak signals, all at very high 5G speeds.

The problem is mostly solved. The top of the line Mate 30 only requires 2 US parts. Huawei and suppliers like Murata Japan will soon be able to replace those as well. Chinese universities and military suppliers already produce state of the art chips.

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Blasphemy: The US problem is Huawei’s security is too good

Everyone knows the $100B/year US security apparatus taps almost the entire Internet. Friendly governments help from Australia to Canada to France. Companies like AT&T, Ericsson, Verizon, and Nokia obviously cooperate.

The NSA assumes that China is attempting to do the same and that Huawei as a Chinese company will provide assistance. The evidence suggests otherwise.

Huawei is the primary opponent of US security. Hundreds of expert agents have been looking for evidence of Huawei spying. They haven’t found anything. The dog hasn’t barked. Almost certainly, little or nothing is going on.

Could it be that Huawei’s offence is not cooperating with US spying, unlike Nokia & Ericsson? I have no evidence, but it’s a plausible inference.

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Huawei custom chip radios win European fans

Custom chips run faster, draw less power, and need less cooling. It’s standard practice to use reprogrammable FPGA’s during test and low volume production. Nearly all designs move to custom when they reach enough volume, 10’s or 100’s of thousands.

Huawei has now shipped 400,000 5G base stations. That it is switching to dedicated chips normally wouldn’t be worth a story. However, experienced analyst Joe Madden told a major newspaper the Europeans wouldn’t be happy with the new units. I see no evidence Europeans carriers are pulling back from Huawei. Two confirmed to me they will happily buy the Huawei radios without the US parts.

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Dear Tom. Huawei has shipped 600,000 of your Massive MIMO systems

Tom Marzetta introduced Massive MIMO in his classic 2010 paper, Noncooperative Cellular Wireless with Unlimited Numbers of Base Station Antennas. Huawei has now shipped 200,000 4G MM radios and 400,000 5G radios. All 5G systems to date are designed for Massive MIMO.

In 2014, Tom told me to expect systems in four or five years. So I was startled to discover ZTE and Huawei shipping MM systems in 2016. I believe I was the first to report that China Mobile was buying 4G MM from Huawei. Huang Yuhong of China Mobile told me to expect MM would deliver about three times the capacity.

Although Marzetta invented MM at Nokia Bell Labs, Nokia did not ship until 2018. Ericsson and Samsung also began deliveries in 2018. The Chinese are clearly ahead.

Huawei announced their third generation of MM at their Zurich event, with improved software/algorithms. Ryan Ding told us Huawei employs 700 mathematicians, surely more than competitors.

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The unbelievably high cost of the war against Huawei (first analysis)

U.S. companies were selling $11 billion a year of parts to Huawei before the blockade. Losing those sales is just the start of the damage. Every other Chinese and Russian company is making sure to find non-US suppliers. The U.S. has threatened India and Turkey with sanctions as well.

As other companies replace US components, the impact will be tens of billions more than the $11 billion of Huawei suppliers. Redesigning mobile phones and other products can take from three months to three years, so sales will be lost over time.

The relative decline in sales at Qualcomm and Broadcom suggests they are seeing other customers are cutting back, not just Huawei. That isn’t certain yet, however.

European companies are considering similar self-protection. A very senior German engineer tells me German companies in automotive and electronics are also designing out components only available from the US. Given how few electronic products are produced and manufactured in the US, the ultimate impact can be huge.

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5G Huawei radios do not contain US parts

Huawei has developed custom chips that replace the FPGAs previously bought from US companies Xilinx and Intel/Altera. Those were the only major components of 5G cell site radios that were hard to source in Asia. Huawei has shipped 200,000 5G radios in 2019 and is ready to produce 1,500,000 or more in 2020.

“We carried out the testing in August and September, and from October on we will start scale production,” according to Ren. Reuters also reports Huawei’s Will Zhang believes,” the performance of the U.S.-free base stations was ‘no worse’ and the company ‘has had positive surprises’”. 

FPGAs are semi-custom ships that replace multiple chips on a circuit board. They are slower and use more power than a custom-designed chip, so mostly are used for first trials and short runs.

It takes several months and costs millions to produce a dedicated chip. The industry practice is to switch from FPGA’s when the design is set and tens of thousands of units need to be produced. ZTE also has a dedicated chip; Nokia and Ericsson are rumored to be working on same.

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Ren to Donald Trump: Take our 5G, please

Ren Zhangwei tells the Economist and the NY Times he is prepared to give the US essentially everything the President has asked, including the crown jewels: the complete design and source code of Huawei’s 5G system. Ren

would license the entire Huawei 5G platform to any American company that wants to manufacture it and install it and operate it, completely independent of Huawei.

This actually would be a brilliant move if the US buys in. (Unlikely.) Huawei has no chance to make significant sales in the US, as the Democrats and Republicans compete on who will “be tougher” on China. A 10-25% royalty – which is cheap for the complete system design – would bring Huawei $billions more than it would otherwise earn in the US.

Any deal would be a boost to US manufacturing, speed 5G deployment, and provide a good answer to any security issues. It remains unlikely for US political reasons.

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