Google reverses decision to cut ties with Huawei after US eases trade restrictions
Google reverses decision to cut ties with Huawei after US
eases trade restrictions
Sam Meredith TUE, MAY 21 2019 4:57 AM EDT
The U.S. Commerce Department announced Monday it had
granted a 90-day license for mobile phone companies and internet broadband
providers to work with Huawei to keep existing networks online and protect
users from security risks.
The exemption allows Google to send software updates to
Huawei phones which use its Android operating system through to August 19.
Alphabet Inc’s Google said Tuesday that it plans to work
with China’s Huawei over the next 90 days, shortly after the U.S. temporarily
eased some trade restrictions on the world’s second-largest smartphone maker.
The move marks a sudden and dramatic turnabout for the
U.S. tech conglomerate. On Sunday, Google said it would cut ties with Huawei in
order to comply with Washington’s decision to put China’s telecom giant on the
so-called Entity List.
However, shortly thereafter, the U.S. Commerce Department
announced it had granted a 90-day license for mobile phone companies and
internet broadband providers to work with Huawei to keep existing networks online
and protect users from security risks.
The exemption allows Google to send software updates to
Huawei phones which use its Android operating system through to August 19.
“Keeping phones up to date and secure is in everyone’s
best interests and this temporary license allows us to continue to provide
software updates and security patches to existing models for the next 90 days,”
a Google spokesperson told CNBC in an email on Tuesday.
Temporary general license
The U.S. Commerce Department said it would assess whether
to extend the temporary exemptions beyond 90 days.
Late last week, the Commerce Department added Huawei and
68 other entities to an export blacklist, rendering it practically impossible
for the Chinese company to purchase goods made in the U.S.
The companies placed on the Entity List are deemed to be
engaged in activities that threaten the national security or the foreign policy
interests of the U.S.
Monday’s announcement explained the latest authorization
had been created as a temporary general license. It allows disclosures of
security vulnerabilities and for Huawei to engage in the development of
standards for future 5G networks — effectively prompting the firm to become
more transparent.
A spokesperson for Huawei declined to comment when
contacted by CNBC.
Huawei was the second-largest smartphone maker by global
market share in the first quarter. The company has previously laid out its
ambitions to become the top player in smartphones by 2020.
Out of the $70 billion Huawei spent buying components in
2018, some $11 billion went to U.S. firms including Qualcomm, Intel and Micron
Technology.
Just over 49% of Huawei’s smartphone shipments went to
international markets outside of mainland China in the first quarter of 2019,
according to Canalys.
— CNBC’s Penny Chen and Reuters contributed to this
article.
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