Huawei is currently in a difficult situation. The multiple restrictions imposed by the United States Government They have left a path full of obstacles before the Chinese company. On the one hand, the purchase of components (and the manufacture of the ones that they design themselves) has been enormously complicated. And, on the other hand, the inability to incorporate Google services on their smartphones has seriously damaged their business in Europe.
Before this panorama, the brand decided to sell the Honor division, which is now independent and can negotiate more freely with US companies. Also, according to ., they are evaluating the possibility of selling the P and Mate brands, which could be interpreted as an abandonment of, at least, the market for high-end smartphones.
In parallel, Huawei has been driving an entire ecosystem of services. These include the App Gallery (application store), Huawei Mobile Services (set of APIs and tools that allow you to create Huawei mobile applications) and the HarmonyOS operating system. The brand has also been open to supplying this software to other manufacturers. In fact, HarmonyOS will be an open-source system, so anyone can take its code and use it.
Pivot the Huawei model from hardware to software
Huawei Mate 40 Pro.
All these pieces of the puzzle invite us to think about a possible future in which Huawei, instead of focusing on hardware manufacturing, focus on software. Its role would be similar to that of Google in the Android ecosystem. That is to say: create an operating system, develop a software ecosystem around it, supply it to other manufacturers and monetize it.
A key factor in this equation is that, although the focus of the restrictions has been on Huawei, No one can rule out the US applying similar measures to other Chinese technology companies. In fact, the North American country recently included Xiaomi on its blacklist. This doesn’t stop you from trading with Google or other US companies, but it does make it clear that the US has you in its sights.
The only way for the Chinese tech ecosystem to protect itself against this potential threat is autonomy. And, in this case, that goes through an alternative services ecosystem on which the United States cannot apply any restrictions. That is precisely where Huawei could enter the scene and position itself as a kind of alternative to Google.
The trade restrictions imposed by the United States, let’s remember, they would not prevent Huawei from pivoting into the software world. And since smartphone manufacturing seems like a near-impossible mission given current constraints, becoming a software partner for other manufacturers – as Google does – could be a viable solution.
Will anything change with Joe Biden?
Joe Biden, President of the United States. Image via Gage Skidmore (Flickr)
It is true that, under the Joe Biden Administration, US-China tensions may ease. But, given the projection of the Asian country as an economic power and, above all, observing the rise of the Chinese technology industry, it is possible that the North American country will continue to apply restrictions that limit its growth. Therefore, it would not be a surprise if China decides to protect its promising technology sector from these potential threats.
Huawei, for its part, It has been open to collaborating with other companies in the creation of an alternative ecosystem. They have also developed tools such as Huawei Docs, Petal Maps or Petal Search, which promise to replace Google Docs, Google Maps and the Google search engine, among other things. And, as I explained earlier, they are getting rid of some hardware-related divisions as they develop HamonyOS, Huawei Mobile Services and the App Gallery.
Enunciating this possibility is obviously easier than executing it. And honestly, the outlook is so uncertain due to current geopolitics that making a prediction about the direction Huawei will take in the coming years is a bit risky. But, what no one can argue is that, at least from the outside, the pieces do seem to fit in that direction.
The article What if Huawei’s future is to become the Google of China and protect its own rivals in the United States? It was published in Explica.co.