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- The United States has effectively blacklisted the world’s second-largest smartphone maker, Huawei, from doing business with US companies.
- The ban is the latest volley in an ongoing trade dispute between the US and China.
- As the ban took effect this week, major tech companies all over the world cut ties with Huawei.
- The ripples from the ban are massive, and impact millions of people all over the world.
- Visit Business Insider’s homepage for more stories.
Chinese tech giant Huawei is having a very bad month.
Following the news that the United States government was effectively banning US companies from doing business with the world’s second-largest smartphone maker, major tech companies all over the world have cut ties with Huawei.
Most notably, Google’s Android smartphone operating system is the backbone of Huawei’s massive smartphone business — but in the next three months, it will stop getting updates on Huawei’s devices. The same could be said for Huawei’s computer business, which relies on Windows 10 from Microsoft and hardware from a variety of different US companies.
The situation is, to put it lightly, a gigantic mess. And with things coming to a head this week, we put together an explainer of the entire situation so you can catch up.
Here’s everything that’s happened so far in Huawei’s very messy month:
First and foremost: What is Huawei?
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Huawei is one of the biggest tech companies in the world — the company’s 2018 revenue exceeded $100 billion, and it employs nearly 200,000 people.
But maybe you’ve never heard the name? That’s because Huawei is a much bigger deal outside the US.
The Chinese tech giant is most well-known for its consumer products: Smartphones, laptops, and networking devices. Huawei is the second-largest phone maker in the world — just above Apple and below Samsung. Massive Huawei ads are a common sight in Europe and Asia, as Huawei smartphones are common consumer devices outside of the US.
But in the United States, Huawei phones aren’t sold in electronics stores like Best Buy, nor are they sold by carriers like Verizon. The phones aren’t even supported by every telecoms company.
In short, it’s surprisingly difficult to buy and use Huawei devices in the US — even before the company was banned.
What’s going on?
On May 16, the US Commerce Department’s Bureau of Industry and Security announced that Huawei was added to the "entity list" — a complicated, bureaucratic way of saying that US companies are barred from doing business with Huawei unless they get explicit permission from the US government.
In the following days, tech companies all over the world began summarily cutting ties with Huawei in keeping with US government regulation.
Exactly why the US government added Huawei to the entity list is a matter of contention.
The official reasoning given by the Commerce Department was that Huawei, "is engaged in activities that are contrary to US national security or foreign policy interest."
But the move also appears to be part of the ongoing trade war between the US and China — something President Trump indicated in a recent exchange with reporters. "Huawei is something that’s very dangerous. You look at what they’ve done from a security standpoint, from a military standpoint, it’s very dangerous," he said this week. What he said next was telling: "It’s possible that Huawei even would be included in some kind of a trade deal. If we made a deal, I could imagine Huawei being possibly included in some form of, or some part of a trade deal."
How does the ban impact Huawei?
Huawei’s smartphones run on Android — and the blacklisting means Huawei can’t use Google’s software after August 19th.
Huawei’s computers run on Windows 10 — and the blacklisting means Huawei can’t use Windows 10 after August 19th either.
Starting to get the idea?
That’s before we start talking about all the other US companies that Huawei works with to create its products. American companies like NVIDIA and Qualcomm make chips that go in Huawei devices, and American companies like Google and Microsoft make software that runs those devices.
By adding Huawei to the entity list, these companies are required to stop working with Huawei.
For example: If you’re a Huawei smartphone user in, say, London, you can expect your Android-powered phone to stop receiving security updates.
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- Here are all the companies that have cut ties with Huawei, dealing the Chinese tech giant a crushing blow
- Here are all the major US tech companies blocked behind China’s ‘Great Firewall’