Heir To Huawei

With Huawei having to confront the prospect of becoming primarily a domestic brand, it makes sense for the world’s second largest manufacturer of smartphones  – and almost certain to be the next  No.1  –  to make its own chips.

With Huawei having to confront the prospect of becoming primarily a domestic brand, it makes sense for the world’s second largest manufacturer of smartphones  – and almost certain to be the next  No.1  –  to make its own chips.

 After all, Samsung the current No.1, Huawei the No.3, and Apple the No.4 already make their own chips and, if you’re going to be No.1 you’re going to need a guaranteed supply of leading edge tech.

Xiaomi, the No.5, had a go at making its own chips, forming an IC unit in 2014 and producing a chip of its own in 2017. But it never produced another and relies on Qualcomm and MediaTek for its ICs.

Now, with the US making it difficult for Huawei to get US chips, is the right moment for the next-No.1 both to secure independence from the vagaries of US chip supply and to make a play for Huawei’s market share.

BBK Electronics, the No.2 – wannabe No.1 – smartphone manufacturer with brands Oppo, Vivo, Realme and OnePlus, is recruiting smartphone talent. 

It is using its Oppo subsidiary to recruit execs from MediaTek, Qualcomm, HiSilicon and the Chinese chip conglomerate Unisoc.

A recent hire, according to the Nikkei, was Jeffrey Ju, COO of MediaTek.

Of course it’s going to cost BBK  a fortune. It was 12 years ago that Apple showed serious intent in making its own chips by buying PA Semiconductor. It is still reliant on outside supply for modems.

It is over ten years since Huawei set up HiSilicon and only this year could it reduce its US content for its most advanced phone, the Mate 30, to virtually nothing.

So BBK has a tough and expensive road ahead. Can it afford it? No one really knows because BBK is a private company and is not obliged to publish its financials.

But, seeing what happened to Huawei, it probably feels it can’t afford not to try.