Loading...

Huawei faces break with UK chip giant ARM

Published: May 22, 2019 22:30:54


Huawei unveiling new phones powered by ARM-based chips, on Tuesday

UK-based chip designer ARM has told staff it must suspend business with Huawei, according to internal documents obtained by the BBC.

ARM instructed employees to halt "all active contracts, support entitlements, and any pending engagements" with Huawei and its subsidiaries to comply with a recent US trade clampdown.

ARM's designs form the basis of most mobile device processors worldwide.

In a company memo, it said its designs contained "US origin technology".

As a consequence, it believes it is affected by the Trump administration's ban.

One analyst described the move, if it became long-term, as an "insurmountable" blow to Huawei's business.

He said it would greatly affect the firm's ability to develop its own chips, many of which are currently built with ARM's underlying technology, for which it pays a licence.

Cambridge-headquartered ARM had been described as the UK's largest tech firm until its takeover by a Japanese fund. It employs 6,000 workers and lists eight offices in the US.

In a statement it said it was "complying with all of the latest regulations set forth by the US government", but declined to comment further.

A spokesman for Huawei said the company "is not commenting at this time".

ARM is a chip designer founded in 1990. In September 2016 it was acquired by Japanese telecoms giant Softbank, but remains based in Cambridge, UK.

ARM does not manufacture computer processors itself, but rather licenses its semiconductor technologies to others.

In some cases, manufacturers only license ARM's architecture, or "instruction sets", which determine how processors handle commands. This option gives chip-makers greater freedom to customise their own designs.

In other cases, manufacturers license ARM's processor core designs - which describes how the chips' transistors should be arranged. These blueprints still need to be combined with other elements - such as memory and radios - to create what is referred to as a system-on-chip.

As a result, when you hear talk of a device being powered by a Samsung Exynos, Qualcomm Snapdragon or Apple A11 chip - or one in a Huawei smartphone - it is still ARM's technology that is involved.

ARM's US headquarters are in San Jose, California, and the firm has offices in Washington, Arizona, Texas and Massachusetts.

ARM's staff were informed of the decision on 16 May, following the US Commerce Department's move to add Huawei to its "entity list" of companies with which American firms could no longer do business.

The BBC has also seen a company memo dated 18 May detailing the implications of the export ban.

Share if you like