13 ms·

Huawei Reveals the Real Trade War with China

139 points by alanwong 8y ago

entity345 8y ago
The US are at war with China. Trade is just one aspect. The issue is that they cannot 'win' that war. They can only delay the rise of China. At the moment US' actions are uniting the Chinese people behind their government so the Chinese might actually be able to (or forced to) take a harder line on some issues.
- zavi 8y ago
  Or 10 years will pass and China will be stuck with 400 million sick old people slowly turning from the key asset to liability.
projectramo 8y ago
Here is my confusion: if the war against China is really about high tech dominance, and Huawei is a particular target because it just surpassed Apple for #2 spot, then why isn't action taken against Samsung instead which is at the #1 spot? Samsung is not a Chinese company, so this seems to be about national competition and not tech "dominance".
- pesmhey 8y ago
  We have a large military presence within South Korea. They are an ally. We’ve fought together, and have a common interest in a contained China. Tech dominance IS national competition.
- Mirioron 8y ago
  I like how we're supposed to have a relatively free market in the west, yet the hands of large companies are always tied by the government, because any company, if large enough, is "a national security concern".
  - adrianN 8y ago
    More like the hands of the government are tied by large companies.
- ThomPete 8y ago
  They are korean we share goals and markets.
- abc-xyz 8y ago
  Because China are the Nazis of our century.
  - sctb 8y ago
    This is not a civil and substantive comment, so please follow the guidelines instead. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
- flexie 8y ago
  Because even if South Korea joined North Korea and even if they doubled or tripled their wealth, they would still be too small to impose a threat to the US dominance. Australia, Canada or even large European nations are not seen as threats either. But a unified EU is seen as a threat by Trump.
- est 8y ago
  Samsung is the result of US's stripping of Japan's manufacturing power. Japan used to challenge US's hi-tech status in the 70s and 80s. US forced Japan signing the "Plaza Accord" and immediately Japan entered the "lost decade", and so the chip manufacturing power was strategically moved to Taiwan and S.Korea. Now it's turn for China.
  - dukoid 8y ago
    The "Plaza Accord" was an agreement between the US, France, Germany, Japan, the United Kingdom to depreciate the USD in 1985. USD deprecation was halted by the "Louvre Accord" in 1987 https://en.wikipedia.org/wiki/Plaza_Accord https://en.wikipedia.org/wiki/Plaza_Accord https://en.wikipedia.org/wiki/Louvre_Accord https://en.wikipedia.org/wiki/Louvre_Accord
  - pkhagah 8y ago
    One thing I don't understand is how US, Japan and S.Korea led high-tech outsourced manufacturing efforts in China. As far as I understand everything is hunky dory starting with _Good will_ from Deng, until China became world's manufacuting hub. Only then it became a huge issue. My question is didn't any one consider China's current rise in late 80's and early 90's when they started outsourcing manufacturing?
    - onemoresoop 8y ago
      I think the idea was to let china do the dirty work of manufacturing and staying at that. That didn't work as we we can now see. And I'm blaming the west's confidence of conveniently outsourcing the production to China thinking they'll always be in control.
- mc32 8y ago
  Maybe SamSung is playing fair? Usually the US is okay with others outdoing us, if they play fair, and historically even if they play a little dirty (Japan late 80s early 90s) but probably not okay of they play wholly unfair with gov't backing and support.
- luddy 8y ago
  It is a money laundering case. HSBC tipped off the US gov't to a transfer that was effectively made using a false identity, to a recipient that was on a sanctions list. The US has banking laws, just like China has. If Tim Cook goes to Bank of China on Nanjing Lu and lies to SAFE so that he can wire a lot of RMB out of China, then the Chinese authorities will apprehend him. It's not as mysterious as it is being made out to be. Maybe she will walk because she's a celebrity executive in China, and because her case has been spun to be all about competition between the US and China, but still: banking laws are banking laws, in the US, China, Hong Kong, Europe, you name it. If you don't want to be in danger of breaking them, don't use the banks in that country.
adgjl 8y ago
Reading Michael Pillsbury will help you understand actions by the US admin against China. His book, the hundred year marathon, states the theory it subscribes to according to Bloomberg and Politico (I dont know how true the theory is and some China experts disagree with the book) "But what if the “China Dream” is to replace us, just as America replaced the British Empire, without firing a shot? Based on interviews with Chinese defectors and newly declassified, previously undisclosed national security documents, The Hundred-Year Marathon reveals China’s secret strategy to supplant the United States as the world’s dominant power, and to do so by 2049, the one-hundredth anniversary of the founding of the People’s Republic. Michael Pillsbury, a fluent Mandarin speaker who has served in senior national security positions in the U.S. government since the days of Richard Nixon and Henry Kissinger, draws on his decades of contact with the “hawks” in China’s military and intelligence agencies and translates their documents, speeches, and books to show how the teachings of traditional Chinese statecraft underpin their actions. " https://thehundredyearmarathon.com/ https://thehundredyearmarathon.com/ http://www.michaelpillsbury.net/ http://www.michaelpillsbury.net/ https://www.bloomberg.com/news/articles/2018-09-27/trump-identifies-the-leading-authority-on-china-who-is-he https://www.bloomberg.com/news/articles/2018-09-27/trump-ide... https://www.politico.com/story/2018/11/30/trump-china-xi-jinping-g20-michael-pillsbury-1034610 https://www.politico.com/story/2018/11/30/trump-china-xi-jin... Competition to usd, Petroyuan is coming. "The Rise of the “Petroyuan” For the past decade, China’s strategy for internationalizing the renminbi has involved greater reliance on the IMF’s Special Drawing Rights as an alternative international reserve currency. But the launch of renminbi-denominated oil trading this year suggests that China will now pursue de-dollarization head-on." https://www.project-syndicate.org/commentary/rise-of-petroyuan-challenges-dollar-hegemony-by-john-a--mathews-and-mark-selden-1-2018-12 https://www.project-syndicate.org/commentary/rise-of-petroyu...
- euroclydon 8y ago
  If that's the case (which clearly it is), then limiting immigration is a bad move. Historically, the most powerful nations have been those with a free-wheeling economy and open/liberal attitudes. The U.S. needs to continue to attract the world's bright, ambitious, and hard-working people. Now, I don't think the U.S. can afford to provide much of a safety net, in regards to basic income and healthcare if it's going to have open borders and a great deal of economic freedom. It will be expensive enough just to deal with the enviornmental problems of a dynamic economy.
andor 8y ago
"The U.S. still makes — or at least, designs — the best computer chips in the world. China assembles lots of electronics, but without those crucial inputs of U.S. technology, products made by companies such as Huawei would be of much lower-quality." The accusations against Huawei are coming at a time where this is simply not true anymore. Huawei are making their own chips under the HiSilicon brand. Just like Qualcomm chips, their CPU part is based on ARM IP, and ARM are based in the UK and owned by SoftBank. The current Kirin 980 is the fastest non-Apple SoC available on the market and as power efficient as the A12. https://www.anandtech.com/show/13503/the-mate-20-mate-20-pro-review/3 https://www.anandtech.com/show/13503/the-mate-20-mate-20-pro...
- chadAnon69 8y ago
  Because the Chinese government steals it and then gives it to "private" chinese companies Not having to do billions in R&D makes it pretty easy to catch up. https://www.nytimes.com/2018/06/22/technology/china-micron-chips-theft.html https://www.nytimes.com/2018/06/22/technology/china-micron-c...
- fisherjeff 8y ago
  Minor nitpick: As highlighted in the article, power consumption is on par with A12, not efficiency. A12 still (somehow!) leads by ~50-100% there.
- throwawayFive 8y ago
  The Kirin 980 SoC uses the Cortex-A76 which was designed in Austin, TX, United States of America. The statement "The U.S. still makes — or at least, designs — the best computer chips in the world" is accurate in the context of a manufacturer attempting to build a high-performance microprocessor-based device.
  - StudentStuff 8y ago
    Exactly, thus far China doesn't have the technology to do sub-14nm foundry work at any notable scale, and as we saw with Dhyana, they apparently don't have the internal talent to improve AMD's Zen cores. The foundry issue isn't apt to change anytime soon, as newer nodes are extremely expensive and take years to bring up (see Global Foundries & Intel's troubles with newer processes).
Tor3 8y ago
ZTE was close to breaking point while they were blocked from US components, until that sanction was lifted (after the big fine). According to the Bloomberg article there may be a similar deal for Huawei - pay a huge fine or get locked out. What will obviously happen is that the Chinese will not, can not, accept that they're depending on US components when they could get locked out from them at any moment. They will therefore accelerate, by whatever means (research, hack, steal, invent, anything) their own ability to produce all the parts themselves. In short, putting the squeeze on China will only hold back the tide for a moment, and then backfire.
- burfog 8y ago
  This is awfully similar to when China refused to sell rare-earth element metals, causing the USA to restart production.
- Lio 8y ago
  How will putting the squeeze on China for market parity backfire? The Chinese have the goal of dominating Western markets already. They are pretty unlikely stop the state sponsored industrial espionage, the skirting of sanctions or to open up their own markets with or without import tariffs.
forrestbrazeal 8y ago
The article alludes to, but doesn't expand on, the US's lost lead in furniture manufacturing. For more on this fascinating story, I recommend Beth Macy's "Factory Man" [0], the story of the systematic destruction of the North Carolina and Virginia-based wooden furniture industry by Chinese imports. It's the exact same playbook as Huawei -- govt-backed "dumping" of loss-priced goods in an attempt for total market dominance. And US companies have historically been way too willing to expose trade secrets to Chinese manufacturers in exchange for temporarily cheaper supplies -- a Faustian bargain. [0] https://www.amazon.com/Factory-Man-Furniture-Offshoring-American/dp/031623141X https://www.amazon.com/Factory-Man-Furniture-Offshoring-Amer...
- sct202 8y ago
  In the case of furniture and other lower tech industries (clothing & textiles too), when Chinese products got slapped with tariffs production shifted to a different off-shore countries (Vietnam, Bangladesh, etc). The structural disadvantages that American manufacturing has doesn't go away, and honestly how many trade secrets are there to producing furniture. It's not like they don't have furniture already in the rest of the world.
  - gman83 8y ago
    But presumably they won't be sold at a loss in a bid for market dominance.
    - rjzzleep 8y ago
      Funny, because that seems to be precisely what Uber is all about.
    - echaozh 8y ago
      If the Chinese sold furniture at a loss for market dominance, after the said dominance is gained, did the price soar? The Chinese made cheaper furniture due to a lot of reasons, cheap labor, cheap resources, and presumably lower quality may be some of them, but selling at a loss definitely is not.
dalbasal 8y ago
Anyone know of big, marquee examples of "trade secrets & technologies" handed over to chinese affiliates. I hear reference to this all the time, but have a hard time "putting meat on it." Any nice clean examples where a chinese company gets IP/secrets that a French company would not have got?
- patrickg_zill 8y ago
  Qualcomm deal with ARM cpu development that they recently canceled (ip stays with the Chinese joint venture) : https://www.pcworld.com/article/3163189/components-processors/new-made-in-china-chip-on-the-way-as-country-boosts-indigenous-tech.html https://www.pcworld.com/article/3163189/components-processor...
- captainperl 8y ago
  > Anyone know ... Chinese companies are controlled by the Chinese government. Any partnership in China with a Chinese company is controlled by the Chinese government. Got it?
chadAnon69 8y ago
Everyone trashed Trump for the solar tariffs but I liked it for this reason. Sure, temporarily they get more expensive but what happens in 20+ years when the world is reliant on solar power and China has a complete monopoly because they played the long game and subsidized it until all competitors died out? China is playing the long game, the west plays quarter to quarter because of the stock market
- java-man 8y ago
  and of course we don't want the free market to punish the incompetent and reward the smart ones, do we?
  - djohnston 8y ago
    we want to position ourselves for not being steam rolled in the next half century. that is what being competent demands.
  - chadAnon69 8y ago
    In what free market does a government subsidize a company and force competitors to give their native companies their IP to do business? China never cared about free trade, they use it like a weapon to beat idealists like yourself over the head What happens in 20 years when China has complete dominance of the solar market and those "cheap" solar panels get tripled in price because there is no competition left and the rest of the world can only grit their teeth?
    - java-man 8y ago
      what we should do then is to support local manufacturing by purchasing massive amount of solar panels, building battery based grid storage, switching transportation to electric on massive scale. slapping tariffs on foreign products ensures that our manufacturing becomes even more backward, while the rest of the world takes off. if we want to avoid monopoly - build own capacity, competitively.
      - 8y ago
sonnyblarney 8y ago
She created a subsidiary company in Hong Kong, bought products made in the US and sold them to Iran. The investigation started long ago. This may just be a case of bad timing. Who knew that an exec of a US competitor just also happened to be corrupt? It doesn't make sense in the context of the trade deal, the better reality is that it's actually just the US locking down on people breaking the sanctions.
- majia 8y ago
  Based on available public information, the case happened about eight years ago, and Meng was not a top executive at Huawei. At that time there were many companies in China and elsewhere selling US products to Iran. Huawei allegedly sold about 1 million dollar goods for civilian use. The selective law enforcement in this case is rather curious: Why would the US persecute this particular case so vigorously? Extradition is not very common for crimes of this level of severity. Why would the US want to have someone physically arrested instead of to punish Huawei with fine and export ban, which are more common for companies violating sanctions? Why would the US choose to arrest the daughter of Huawei's founder, instead of someone who is more directly involved in the Iran deal? It is hard to believe this is a case of bad timing. There has been lots of infighting within the Trump administration. Most likely, the hawk fraction intentionally chose to arrest Meng at the time of Trump-Xi meeting in order to undermine a possible trade deal by embarrassing China. Think about what happens if China arrests Tim Cook because Apple didn't pay the right amount of tax in China eight years ago.
  - coldtea 8y ago
    >Why would the US persecute this particular case so vigorously? Extradition is not very common for crimes of this level of severity. To send a signal "we can go tough if you don't sit back and take it on our trade terms (which have nothing to do with Iran)"
  - sonnyblarney 8y ago
    The case is directed at her specifically: "Meng is accused of committing fraud in 2013 by telling U.S. financial institutions that Huawei had no connection to Skycom, which was reportedly selling goods manufactured in the United States to Iran in violation of American sanctions on Tehran. Meng has contended Huawei sold Skycom in 2009." [1] As far as selective enforcement - can you give any examples? Also - even though you're probably right on some level, and I fully agree there's 'relevance' to the current situation in China, I would argue it's not acutely relevant. A lot of law enforcement doesn't happen until there's some people getting bold about it. For example, the Hells Angels get away with a lot until there is real violence, or super hardcore drugs start appearing - then the cops focus their attention more on the situation. Organized crime knows this, which is why they choose to keep the equilibrium by staying quiet, generally. Since America has general competitive concerns with China, it makes sense that a large international firm that is flagrantly violating US law would be targeted by a body in the justice system. But it doesn't mean that Trump's hawkish team is behind this as a part of the negotiations. In fact, I really don't think it's part of the negotiation, and I even bet that Trump et. al. were caught maybe off guard by it. So yes, politicized, but more in general, not acutely. Moreover, if there is law being broken it should be prosecuted, and to your point, hopefully more evenly. FYI - sometimes these things are also done to 'send a signal'. Just like if a Hells Angel dude steps out of line and maybe does something violent, and the cops rush down on all members of that chapter, it's a 'signal' to HA leadership that if they step out of line, that's what's going to happen, i.e. part of keeping the equilibrium. Otherwise, if the HA chapter got away with something, others might try as well. [1] https://www.ndtv.com/world-news/meng-wanzhou-huawei-cfo-meng-wanzhou-china-tech-executive-lied-to-evade-sanctions-on-iran-us-charges-1959592 https://www.ndtv.com/world-news/meng-wanzhou-huawei-cfo-meng...
ezVoodoo 8y ago
So China's only choice is to stay as a cheap supplier of the US forever? That sounds fair...
peter_retief 8y ago
I find the term trade war misleading, its really just countries trying to protect their intellectual property from theft by China. Money made in the skewed trade deals is used to swop debt for equity in failing economies in Africa, South America and Asia. Further, buying of technology companies in developed economies is another way to duplicate the technology in China to achieve global dominance. Don't forget that China has a political objective, its not all trade and fair play
- zabana 8y ago
  > China has a political objective And the US doesn't ?
  - peter_retief 8y ago
    I often hear that China is a victim of a US trade war, in fact its often framed as Trumps trade war. China is a very aggressive protagonist and we should be wary of the politically correct narrative that is being used to mollify the west. So of course the US is political and it needs to stand up for its own society
mark_l_watson 8y ago
“‘U.S. moves against Huawei and ZTE may be intended to force China to remain a cheap supplier instead of a threatening competitor.“‘ This is what I also first thought when hearing about the arrest. This is all about economic warfare. Long term, I think this will be bad for my country (USA) because this will induce China to continue a huge national program to develop home grown tech.
- Lio 8y ago
  On the other hand China is already committed to undermining US market dominance anyway. So maybe this just buys US industry a little more time. Allowing a foreign competitor to grow to a dominant position by skirting sanctions or from profiting from state-sponsored industrial espionage is not good either.
ramblerouser 8y ago
The US should ban export of all high tech related IP to China as a national security concern. The wholesale outsourcing of decades worth of our hard earned technological innovation is treasonous. China would never give us access to that kind of tech if it were developed in China.
- cyphar 8y ago
  Can you explain how it is a national security problem (I didn't understand that phrasing in the article either)? But you also might be forgetting that almost all hardware is manufactured in China (and thus they could easily reciprocate such actions).
  - ramblerouser 8y ago
    The ease with which China can disrupt our supply chain (in the short term) is precisely the point. Their theft of millitary and comercial secrets is another. China requires american companies selling or manufacturing in china to divulge secrets and implant chinese nationals (agents of the communist party) into said american companies so they can copy our technology and use state funds to begin competing chinese owned companies. This has hollowed out the American manufacturing base. Fewer qualified American engineers and workers means less military readiness, especially against threats China doesnt want us engaged with. Think Russia. This process also means that their military will both have a larger industrial base to support it, and better technology to arm it. The USA is not a tool for the Chinese to extract reasources and knowledge from. We worked hard to get where we are, and they are illegally piggybacking on us by stealing our intellectual property.

139 points by alanwong 8y ago

The US are at war with China. Trade is just one aspect. The issue is that they cannot 'win' that war. They can only delay the rise of China. At the moment US' actions are uniting the Chinese people behind their government so the Chinese might actually be able to (or forced to) take a harder line on some issues.

zavi 8y ago
Or 10 years will pass and China will be stuck with 400 million sick old people slowly turning from the key asset to liability.

projectramo 8y ago

Here is my confusion: if the war against China is really about high tech dominance, and Huawei is a particular target because it just surpassed Apple for #2 spot, then why isn't action taken against Samsung instead which is at the #1 spot? Samsung is not a Chinese company, so this seems to be about national competition and not tech "dominance".

pesmhey 8y ago
We have a large military presence within South Korea. They are an ally. We’ve fought together, and have a common interest in a contained China. Tech dominance IS national competition.
Mirioron 8y ago
I like how we're supposed to have a relatively free market in the west, yet the hands of large companies are always tied by the government, because any company, if large enough, is "a national security concern".
- adrianN 8y ago
  More like the hands of the government are tied by large companies.
ThomPete 8y ago
They are korean we share goals and markets.
abc-xyz 8y ago
Because China are the Nazis of our century.
- sctb 8y ago
  This is not a civil and substantive comment, so please follow the guidelines instead. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
flexie 8y ago
Because even if South Korea joined North Korea and even if they doubled or tripled their wealth, they would still be too small to impose a threat to the US dominance. Australia, Canada or even large European nations are not seen as threats either. But a unified EU is seen as a threat by Trump.
est 8y ago
Samsung is the result of US's stripping of Japan's manufacturing power. Japan used to challenge US's hi-tech status in the 70s and 80s. US forced Japan signing the "Plaza Accord" and immediately Japan entered the "lost decade", and so the chip manufacturing power was strategically moved to Taiwan and S.Korea. Now it's turn for China.
- dukoid 8y ago
  The "Plaza Accord" was an agreement between the US, France, Germany, Japan, the United Kingdom to depreciate the USD in 1985. USD deprecation was halted by the "Louvre Accord" in 1987 https://en.wikipedia.org/wiki/Plaza_Accord https://en.wikipedia.org/wiki/Plaza_Accord https://en.wikipedia.org/wiki/Louvre_Accord https://en.wikipedia.org/wiki/Louvre_Accord
- pkhagah 8y ago
  One thing I don't understand is how US, Japan and S.Korea led high-tech outsourced manufacturing efforts in China. As far as I understand everything is hunky dory starting with _Good will_ from Deng, until China became world's manufacuting hub. Only then it became a huge issue. My question is didn't any one consider China's current rise in late 80's and early 90's when they started outsourcing manufacturing?
  - onemoresoop 8y ago
    I think the idea was to let china do the dirty work of manufacturing and staying at that. That didn't work as we we can now see. And I'm blaming the west's confidence of conveniently outsourcing the production to China thinking they'll always be in control.
mc32 8y ago
Maybe SamSung is playing fair? Usually the US is okay with others outdoing us, if they play fair, and historically even if they play a little dirty (Japan late 80s early 90s) but probably not okay of they play wholly unfair with gov't backing and support.
luddy 8y ago
It is a money laundering case. HSBC tipped off the US gov't to a transfer that was effectively made using a false identity, to a recipient that was on a sanctions list. The US has banking laws, just like China has. If Tim Cook goes to Bank of China on Nanjing Lu and lies to SAFE so that he can wire a lot of RMB out of China, then the Chinese authorities will apprehend him. It's not as mysterious as it is being made out to be. Maybe she will walk because she's a celebrity executive in China, and because her case has been spun to be all about competition between the US and China, but still: banking laws are banking laws, in the US, China, Hong Kong, Europe, you name it. If you don't want to be in danger of breaking them, don't use the banks in that country.

adgjl 8y ago

Reading Michael Pillsbury will help you understand actions by the US admin against China. His book, the hundred year marathon, states the theory it subscribes to according to Bloomberg and Politico (I dont know how true the theory is and some China experts disagree with the book) "But what if the “China Dream” is to replace us, just as America replaced the British Empire, without firing a shot? Based on interviews with Chinese defectors and newly declassified, previously undisclosed national security documents, The Hundred-Year Marathon reveals China’s secret strategy to supplant the United States as the world’s dominant power, and to do so by 2049, the one-hundredth anniversary of the founding of the People’s Republic. Michael Pillsbury, a fluent Mandarin speaker who has served in senior national security positions in the U.S. government since the days of Richard Nixon and Henry Kissinger, draws on his decades of contact with the “hawks” in China’s military and intelligence agencies and translates their documents, speeches, and books to show how the teachings of traditional Chinese statecraft underpin their actions. " https://thehundredyearmarathon.com/ https://thehundredyearmarathon.com/ http://www.michaelpillsbury.net/ http://www.michaelpillsbury.net/ https://www.bloomberg.com/news/articles/2018-09-27/trump-identifies-the-leading-authority-on-china-who-is-he https://www.bloomberg.com/news/articles/2018-09-27/trump-ide... https://www.politico.com/story/2018/11/30/trump-china-xi-jinping-g20-michael-pillsbury-1034610 https://www.politico.com/story/2018/11/30/trump-china-xi-jin... Competition to usd, Petroyuan is coming. "The Rise of the “Petroyuan” For the past decade, China’s strategy for internationalizing the renminbi has involved greater reliance on the IMF’s Special Drawing Rights as an alternative international reserve currency. But the launch of renminbi-denominated oil trading this year suggests that China will now pursue de-dollarization head-on." https://www.project-syndicate.org/commentary/rise-of-petroyuan-challenges-dollar-hegemony-by-john-a--mathews-and-mark-selden-1-2018-12 https://www.project-syndicate.org/commentary/rise-of-petroyu...

euroclydon 8y ago
If that's the case (which clearly it is), then limiting immigration is a bad move. Historically, the most powerful nations have been those with a free-wheeling economy and open/liberal attitudes. The U.S. needs to continue to attract the world's bright, ambitious, and hard-working people. Now, I don't think the U.S. can afford to provide much of a safety net, in regards to basic income and healthcare if it's going to have open borders and a great deal of economic freedom. It will be expensive enough just to deal with the enviornmental problems of a dynamic economy.

andor 8y ago

"The U.S. still makes — or at least, designs — the best computer chips in the world. China assembles lots of electronics, but without those crucial inputs of U.S. technology, products made by companies such as Huawei would be of much lower-quality." The accusations against Huawei are coming at a time where this is simply not true anymore. Huawei are making their own chips under the HiSilicon brand. Just like Qualcomm chips, their CPU part is based on ARM IP, and ARM are based in the UK and owned by SoftBank. The current Kirin 980 is the fastest non-Apple SoC available on the market and as power efficient as the A12. https://www.anandtech.com/show/13503/the-mate-20-mate-20-pro-review/3 https://www.anandtech.com/show/13503/the-mate-20-mate-20-pro...

chadAnon69 8y ago
Because the Chinese government steals it and then gives it to "private" chinese companies Not having to do billions in R&D makes it pretty easy to catch up. https://www.nytimes.com/2018/06/22/technology/china-micron-chips-theft.html https://www.nytimes.com/2018/06/22/technology/china-micron-c...
fisherjeff 8y ago
Minor nitpick: As highlighted in the article, power consumption is on par with A12, not efficiency. A12 still (somehow!) leads by ~50-100% there.
throwawayFive 8y ago
The Kirin 980 SoC uses the Cortex-A76 which was designed in Austin, TX, United States of America. The statement "The U.S. still makes — or at least, designs — the best computer chips in the world" is accurate in the context of a manufacturer attempting to build a high-performance microprocessor-based device.
- StudentStuff 8y ago
  Exactly, thus far China doesn't have the technology to do sub-14nm foundry work at any notable scale, and as we saw with Dhyana, they apparently don't have the internal talent to improve AMD's Zen cores. The foundry issue isn't apt to change anytime soon, as newer nodes are extremely expensive and take years to bring up (see Global Foundries & Intel's troubles with newer processes).

Tor3 8y ago

ZTE was close to breaking point while they were blocked from US components, until that sanction was lifted (after the big fine). According to the Bloomberg article there may be a similar deal for Huawei - pay a huge fine or get locked out. What will obviously happen is that the Chinese will not, can not, accept that they're depending on US components when they could get locked out from them at any moment. They will therefore accelerate, by whatever means (research, hack, steal, invent, anything) their own ability to produce all the parts themselves. In short, putting the squeeze on China will only hold back the tide for a moment, and then backfire.

burfog 8y ago
This is awfully similar to when China refused to sell rare-earth element metals, causing the USA to restart production.
Lio 8y ago
How will putting the squeeze on China for market parity backfire? The Chinese have the goal of dominating Western markets already. They are pretty unlikely stop the state sponsored industrial espionage, the skirting of sanctions or to open up their own markets with or without import tariffs.

forrestbrazeal 8y ago

The article alludes to, but doesn't expand on, the US's lost lead in furniture manufacturing. For more on this fascinating story, I recommend Beth Macy's "Factory Man" [0], the story of the systematic destruction of the North Carolina and Virginia-based wooden furniture industry by Chinese imports. It's the exact same playbook as Huawei -- govt-backed "dumping" of loss-priced goods in an attempt for total market dominance. And US companies have historically been way too willing to expose trade secrets to Chinese manufacturers in exchange for temporarily cheaper supplies -- a Faustian bargain. [0] https://www.amazon.com/Factory-Man-Furniture-Offshoring-American/dp/031623141X https://www.amazon.com/Factory-Man-Furniture-Offshoring-Amer...

sct202 8y ago
In the case of furniture and other lower tech industries (clothing & textiles too), when Chinese products got slapped with tariffs production shifted to a different off-shore countries (Vietnam, Bangladesh, etc). The structural disadvantages that American manufacturing has doesn't go away, and honestly how many trade secrets are there to producing furniture. It's not like they don't have furniture already in the rest of the world.
- gman83 8y ago
  But presumably they won't be sold at a loss in a bid for market dominance.
  - rjzzleep 8y ago
    Funny, because that seems to be precisely what Uber is all about.
  - echaozh 8y ago
    If the Chinese sold furniture at a loss for market dominance, after the said dominance is gained, did the price soar? The Chinese made cheaper furniture due to a lot of reasons, cheap labor, cheap resources, and presumably lower quality may be some of them, but selling at a loss definitely is not.

dalbasal 8y ago

Anyone know of big, marquee examples of "trade secrets & technologies" handed over to chinese affiliates. I hear reference to this all the time, but have a hard time "putting meat on it." Any nice clean examples where a chinese company gets IP/secrets that a French company would not have got?

patrickg_zill 8y ago
Qualcomm deal with ARM cpu development that they recently canceled (ip stays with the Chinese joint venture) : https://www.pcworld.com/article/3163189/components-processors/new-made-in-china-chip-on-the-way-as-country-boosts-indigenous-tech.html https://www.pcworld.com/article/3163189/components-processor...
captainperl 8y ago
> Anyone know ... Chinese companies are controlled by the Chinese government. Any partnership in China with a Chinese company is controlled by the Chinese government. Got it?

chadAnon69 8y ago

Everyone trashed Trump for the solar tariffs but I liked it for this reason. Sure, temporarily they get more expensive but what happens in 20+ years when the world is reliant on solar power and China has a complete monopoly because they played the long game and subsidized it until all competitors died out? China is playing the long game, the west plays quarter to quarter because of the stock market

java-man 8y ago
and of course we don't want the free market to punish the incompetent and reward the smart ones, do we?
- djohnston 8y ago
  we want to position ourselves for not being steam rolled in the next half century. that is what being competent demands.
- chadAnon69 8y ago
  In what free market does a government subsidize a company and force competitors to give their native companies their IP to do business? China never cared about free trade, they use it like a weapon to beat idealists like yourself over the head What happens in 20 years when China has complete dominance of the solar market and those "cheap" solar panels get tripled in price because there is no competition left and the rest of the world can only grit their teeth?
  - java-man 8y ago
    what we should do then is to support local manufacturing by purchasing massive amount of solar panels, building battery based grid storage, switching transportation to electric on massive scale. slapping tariffs on foreign products ensures that our manufacturing becomes even more backward, while the rest of the world takes off. if we want to avoid monopoly - build own capacity, competitively.
    - 8y ago

sonnyblarney 8y ago

She created a subsidiary company in Hong Kong, bought products made in the US and sold them to Iran. The investigation started long ago. This may just be a case of bad timing. Who knew that an exec of a US competitor just also happened to be corrupt? It doesn't make sense in the context of the trade deal, the better reality is that it's actually just the US locking down on people breaking the sanctions.

majia 8y ago
Based on available public information, the case happened about eight years ago, and Meng was not a top executive at Huawei. At that time there were many companies in China and elsewhere selling US products to Iran. Huawei allegedly sold about 1 million dollar goods for civilian use. The selective law enforcement in this case is rather curious: Why would the US persecute this particular case so vigorously? Extradition is not very common for crimes of this level of severity. Why would the US want to have someone physically arrested instead of to punish Huawei with fine and export ban, which are more common for companies violating sanctions? Why would the US choose to arrest the daughter of Huawei's founder, instead of someone who is more directly involved in the Iran deal? It is hard to believe this is a case of bad timing. There has been lots of infighting within the Trump administration. Most likely, the hawk fraction intentionally chose to arrest Meng at the time of Trump-Xi meeting in order to undermine a possible trade deal by embarrassing China. Think about what happens if China arrests Tim Cook because Apple didn't pay the right amount of tax in China eight years ago.
- coldtea 8y ago
  >Why would the US persecute this particular case so vigorously? Extradition is not very common for crimes of this level of severity. To send a signal "we can go tough if you don't sit back and take it on our trade terms (which have nothing to do with Iran)"
- sonnyblarney 8y ago
  The case is directed at her specifically: "Meng is accused of committing fraud in 2013 by telling U.S. financial institutions that Huawei had no connection to Skycom, which was reportedly selling goods manufactured in the United States to Iran in violation of American sanctions on Tehran. Meng has contended Huawei sold Skycom in 2009." [1] As far as selective enforcement - can you give any examples? Also - even though you're probably right on some level, and I fully agree there's 'relevance' to the current situation in China, I would argue it's not acutely relevant. A lot of law enforcement doesn't happen until there's some people getting bold about it. For example, the Hells Angels get away with a lot until there is real violence, or super hardcore drugs start appearing - then the cops focus their attention more on the situation. Organized crime knows this, which is why they choose to keep the equilibrium by staying quiet, generally. Since America has general competitive concerns with China, it makes sense that a large international firm that is flagrantly violating US law would be targeted by a body in the justice system. But it doesn't mean that Trump's hawkish team is behind this as a part of the negotiations. In fact, I really don't think it's part of the negotiation, and I even bet that Trump et. al. were caught maybe off guard by it. So yes, politicized, but more in general, not acutely. Moreover, if there is law being broken it should be prosecuted, and to your point, hopefully more evenly. FYI - sometimes these things are also done to 'send a signal'. Just like if a Hells Angel dude steps out of line and maybe does something violent, and the cops rush down on all members of that chapter, it's a 'signal' to HA leadership that if they step out of line, that's what's going to happen, i.e. part of keeping the equilibrium. Otherwise, if the HA chapter got away with something, others might try as well. [1] https://www.ndtv.com/world-news/meng-wanzhou-huawei-cfo-meng-wanzhou-china-tech-executive-lied-to-evade-sanctions-on-iran-us-charges-1959592 https://www.ndtv.com/world-news/meng-wanzhou-huawei-cfo-meng...

ezVoodoo 8y ago

So China's only choice is to stay as a cheap supplier of the US forever? That sounds fair...

peter_retief 8y ago

I find the term trade war misleading, its really just countries trying to protect their intellectual property from theft by China. Money made in the skewed trade deals is used to swop debt for equity in failing economies in Africa, South America and Asia. Further, buying of technology companies in developed economies is another way to duplicate the technology in China to achieve global dominance. Don't forget that China has a political objective, its not all trade and fair play

zabana 8y ago
> China has a political objective And the US doesn't ?
- peter_retief 8y ago
  I often hear that China is a victim of a US trade war, in fact its often framed as Trumps trade war. China is a very aggressive protagonist and we should be wary of the politically correct narrative that is being used to mollify the west. So of course the US is political and it needs to stand up for its own society

mark_l_watson 8y ago

“‘U.S. moves against Huawei and ZTE may be intended to force China to remain a cheap supplier instead of a threatening competitor.“‘ This is what I also first thought when hearing about the arrest. This is all about economic warfare. Long term, I think this will be bad for my country (USA) because this will induce China to continue a huge national program to develop home grown tech.

Lio 8y ago
On the other hand China is already committed to undermining US market dominance anyway. So maybe this just buys US industry a little more time. Allowing a foreign competitor to grow to a dominant position by skirting sanctions or from profiting from state-sponsored industrial espionage is not good either.

ramblerouser 8y ago

The US should ban export of all high tech related IP to China as a national security concern. The wholesale outsourcing of decades worth of our hard earned technological innovation is treasonous. China would never give us access to that kind of tech if it were developed in China.

cyphar 8y ago
Can you explain how it is a national security problem (I didn't understand that phrasing in the article either)? But you also might be forgetting that almost all hardware is manufactured in China (and thus they could easily reciprocate such actions).
- ramblerouser 8y ago
  The ease with which China can disrupt our supply chain (in the short term) is precisely the point. Their theft of millitary and comercial secrets is another. China requires american companies selling or manufacturing in china to divulge secrets and implant chinese nationals (agents of the communist party) into said american companies so they can copy our technology and use state funds to begin competing chinese owned companies. This has hollowed out the American manufacturing base. Fewer qualified American engineers and workers means less military readiness, especially against threats China doesnt want us engaged with. Think Russia. This process also means that their military will both have a larger industrial base to support it, and better technology to arm it. The USA is not a tool for the Chinese to extract reasources and knowledge from. We worked hard to get where we are, and they are illegally piggybacking on us by stealing our intellectual property.