US war pushes Huawei sales up

A major European telco is “stockpiling equipment in the event of an American ban on Huawei’s purchase of US-made components.” Iain Morris at LR also reports Huawei is giving better service in Europe, quoting another operator, “The Chinese supplier would respond immediately to any problem, while Ericsson might take several days.”

Telcos worldwide support the GSMA position that essentially backs Huawei. They know that having fewer suppliers would raise prices. Morris quotes a senior tech person asserting that Ericsson & Nokia couldn’t replace Huawei in the short term if European governments demanded cutting out Huawei.

Ericsson is still in the 5G race. They’ve added 4,000 engineers for 5G R&D. Morris notes Ericsson has cut 16,000 employees in two years. Nokia also has massive layoffs; I know because of how many of my emails bounce.

40% of world Internet users are in China. The fastest growth is in India and countries like Vietnam. Huawei was never allowed to sell much in the U.S. Strong allies of the U.S. may be US$10-20 billion in Huawei sales. Few of the Europeans or Asians are completely cutting out Huawei.

If the U.S. campaign cut Huawei sales to allies in half, that would be US$5-15 billion. That’s a meaningful share of the company’s US$108 billion in sales but not a crippling one. Huawei sales in 2018 grew by more than US$15 billion. Sales are likely to grow more than US$10 billion despite the war.

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