The news that Google has suspended business with Huawei to comply with the U.S. government's blacklisting of the company was confirmed with a tweet from Android’s official Twitter account. Huawei’s consumer business contributed to nearly half (48%) of the company’s revenue in 2018 and any change will have huge implications on Huawei’s finances.
[caption id="attachment_57902" align="alignleft" width="580"]
Existing Users Are Not Affected
The sudden ban caused a lot of confusion amongst existing Huawei and Honor owners. As confirmed by Android’s tweet, existing owners can still access Google Play (app store). However, there is no confirmation that new Android version (P) and security patches will be made available.
Nonetheless, Huawei can easily pull source codes from Android Open Source Project (AOSP) and roll out its own version of Android OS. Huawei can still rely on AOSP for security patches and even assemble its own team to ensure security patches can be rolled out to its customers faster.
Huawei can continue to push and promote its award-winning P30 series models and the cost competitive Honor sub-brands until the company (or Chinese government) works out a deal with the US.
Huge Implications for its New Models
Huawei typically rolls out two flagship lines in a year, with the P series in February and Mate series scheduled for August. The P30 series was a resounding success in but the launch of the Mate 30 series might be affected. The ban also meant that critical and popular services like Google Map, Google Play and YouTube will not be made available on Huawei’s phones. Sales in China are not affected as the domestic market utilizes services from the local Chinese companies like Baidu. For sales to the rest of the world, Google services are an integral part of the Android experience. The ban will dampen consumer’s demand for Mate 30 series and other new models.
When One Door Closes, Another Opens
Companies like Samsung and Huawei have their own app store for years. Huawei has the financial muscle and clout to ink deals with individual app developers to increase its offerings on Huawei AppGallery (its app store). Huawei can bake in Here WeGo as an alternative to Google Map. Here WeGo app is by Here Technologies which is map navigation company first started by Nokia and now, major ownership resides with the major German automotive manufacturers (Audi, BMW, and Daimler). The loss of YouTube app will be a major blow to Huawei, but users can easily access YouTube via the browser which is a minor inconvenience but not a deal breaker. Huawei might even ink deals with premium content providers like Netflix and Spotify to entice buyers and soften the blow at the loss of Google Services. The Google ban will spur the Chinese company to fight even harder and emerge even stronger.
For more information, please visit: https://www.euromonitor.com/consumer-electronics