Things get worse as ARM (Arm Holdings) suspends business with Huawei

But the U.S. decision to block Huawei from buying USA goods has jeopardised its relationship with global firms involved in making its products, and not just US-based ones. Huawei has been preparing for a ban on U.S. technology for some time, stockpiling components and developing an alternative operating system to Android, but the innovations afforded by ARM would be impossible to replace. However, ARM's decision to end its business with Huawei cuts it off from the chip designs it needs to build the Kirin SoC. While Huawei and its Honor phones, which is a sub-brand of the firm, all use the company's own in-house chipsets under the Kirin series, they are relying on the ARM architecture to power the technology.

Arm's staff were also told they were not permitted to "engage in technical discussions, or otherwise discuss technical matters with Huawei, HiSilicon or any of the other named entities".

ARM instructed employees to halt "all active contracts, support entitlements, and any pending engagements" with Huawei and its subsidiaries, the BBC said.

Even if Huawei manages to switch from US component suppliers to, say, Asian ones for parts like the Corning Gorilla Glass or cellular modems, it's practically impossible to build a competitive smartphone without a chip that uses ARM tech.

Huawei is accused of posing a security threat to Western nations due to its alleged ties with the Chinese government.

ARM licenses crucial semiconductor designs that form the basis of Huawei's Kirin line of processors which run nearly all of Huawei's and its sub-brand Honor's smartphones.

ARM doesn't manufacture smartphone chips but instead licenses its intellectual property to other vendors.

If Huawei finds itself unable to make new SoCs in the future, there aren't many options for smartphone chips.

Huawei reportedly stockpiled Intel chips and server hardware in advance of the trade ban, but it may not have done the same with ARM chips.

Huawei has issued a brief statement aimed at calming markets, but it lacks any substantive details.

Commenting on the news, the Chinese corporation expressed confidence that the "regrettable situation can be solved".

The ongoing trade war between the United States and China has resulted in another stunning development. Even if the whole thing fizzles, Huawei's business has no doubt been hurt.

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