US tech companies to lose billion as China’s Huawei takes its business to Europe
Chinese telecom giant Huawei has revealed plans to spend tens of billions of dollars on technology supplies in Europe over the next five years after being blacklisted in the US.
In an interview with AFP, Huawei explained that the decision was a direct result of Washington banning American companies from selling technology to the group. According to Huawei, there will be consequences for American companies such as Qualcomm, Intel, Micron, and Google. Huawei usually spends over $10 billion a year on semiconductors, spare parts, and services for its smartphones and network equipment.
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The company is increasing its procurement in China, Japan, and Europe to make sure its production chains remain unbroken, said Ernest Lin Zhang, president of enterprise activities for Western Europe at Huawei. He added the US ban has little impact on 5G-equipment supplies, while Huawei “no longer has any American product.”
In mid-October the company reported that it had supplied over 400,000 5G antennas worldwide to about 60 clients, more than half of them in Europe.
Lin Zhang said the company aims to set up a sovereign European cloud, which would enable the storage and processing of data online without going through the US technology giants. Huawei supplies equipment to operators providing this type of service, such as France’s Orange group and Telefonica in Spain.
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“Outside of Europe, we supply our own service, but on the continent, our strategy is based on joint development with our partners,” Lin Zhang said. “We provide them with support to develop their own cloud services.”
He continued: “If clients go through these operators, they are choosing a European operator, the data is stocked in Europe. We have absolutely no access to it. It is managed totally by our partners.”
Washington blacklisted the world’s largest telecom equipment maker earlier this year, and restricted it from doing business with US companies. Huawei has denied US allegations that it shares data with the Chinese government.
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