Huawei, China's formidable competitor to Apple (AAPL) in smartphones, aims to demonstrate its capability to lead Beijing's tech self-sufficiency mission, despite Washington's efforts to stifle its growth. The company recently unveiled a range of devices, including new high-speed smartphones, tablets, smartwatches, and earphones. These are powered by a novel wireless technology called "NearLink," initially termed "Greentooth." Touted as a robust amalgamation of Bluetooth and Wi-Fi's best features, NearLink is designed to offer both efficient, low-power connectivity and high-speed, substantial transmission capabilities, adapting its mode depending on the requirement.
Amid heightened U.S. technological restrictions, China has intensified its push towards self-reliance in pivotal technologies. Last month, Chinese Premier Li Qiang encouraged prominent private companies, including Huawei, to achieve international supremacy through technological innovation. Developing wireless communication technologies is a complex endeavor, necessitating proficiency across disciplines such as signal processing and software development. For perspective, even tech giant Apple has not succeeded in creating its wireless chip, still relying on Qualcomm (QCOM) for this component.
Huawei's vast patent portfolio, especially in essential phone data transmission technologies, positions it as a dominant player in the global tech landscape. Between June 2021 and May 2023, the firm was second only to Qualcomm in publishing wireless communication network technology patents, surpassing Ericsson by over 8,000. Due to U.S. sanctions, Huawei experienced restricted access to critical global tech associations, potentially compromising vital features in their devices. However, the company counteracted this by developing its own technology, as disclosed by Huawei executive Wang Jun in 2021. Despite U.S. skepticism about Huawei's ability to produce advanced chip-enabled devices, evidence indicates some chips are sourced from China's largest contract chip maker, Semiconductor Manufacturing International.
Huawei's technological prowess represents a broader Chinese strategy to harness technological advancement as a geopolitical tool. Beijing has launched initiatives such as Beidou, a substitute for the U.S.'s Global Positioning System and has spearheaded new standards for chip design. In 2020, China initiated an alliance for its indigenous short-range wireless technologies, incorporating over 300 companies and entities, primarily local. According to market-research entity Dell'Oro Group, Huawei continues to reign as the world's top telecom equipment provider, capturing nearly a third of the global market.
