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Following the U.S. government’s announcement that would further thwart Huawei’s chip-making capability, the Chinese telecoms equipment giant condemned the new ruling for being “arbitrary and pernicious.”

“Huawei categorically opposes the amendments made by the U.S. Department of Commerce to its foreign direct product rule that target Huawei specifically,” said Huawei Monday at its annual analyst summit in Shenzhen.

The new curbs, which dropped on Friday, would ban Huawei from using U.S. software and hardware in certain strategic semiconductor processes. This will affect all foundries using U.S. technologies, including those located abroad, some of which are Huawei’s key suppliers.

Earlier on Monday, the Nikkei Asian Review reported citing sources that Taiwanese Semiconductor Manufacturing Co., the world’s largest contract semiconductor that powers many of Huawei’s high-end phones, has stopped taking new orders from Huawei, one of its largest clients. Huawei declined to comment while TSMC said the report was “purely market rumor”.

Decisions from TSMC point to its attempt to strengthen bonds with the U.S. though, as it’s planning a new $ 12 billion advanced chip factory in Arizona with support from the state and the U.S. federal government.

At the Monday conference, Huawei’s rotating chairman Guo Ping admitted that while the firm is able to design some semiconductor parts such as integrated circuits (IC), it remains “incapable of doing a lot of other things.”

“Survival is the keyword for us at present,” he said.

Huawei stated the latest U.S. ban would not only affect its own business in over 170 countries, where it has spent “hundreds of billions of dollars,” but also the wider ecosystem around the world.

“In the long run, [the U.S. ban] will damage the trust and collaboration within the global semiconductor industry which many industries depend on, increasing conflict and loss within these industries.”

Huawei has announced a raft of contingency measures ever since the Trump administration began slapping technology sanctions on it, including one that had cut it off certain Android services from Google.

Huawei said at the summit that it had doubled down on investment in overseas developers in an effort to lure them to its operating system. Some 1.4 million developers have signed up for Huawei Mobile Services or HMS, a 150% jump from 2019. In its search to identify alternatives to Google’s app suite in Europe, it has partnered up with navigation services TomTom and Here, search engine Qwant and news app News UK. 


TechCrunch

As the global economy grinds to a halt, every business sector has been impacted, including the linked worlds of startups and venture capital.

But how much has really changed? If you read VC Twitter, you might think that nothing has changed at all. It’s not hard to find investors who say they are still cutting checks and doing deals. But as Q1 venture data trickles in, it appears that a slowdown in VC activity is gradually forming, something that founders have anecdotally shared with TechCrunch.

To get a better handle on how venture capitalists are approaching today’s market, TechCrunch corresponded with a number of active investors to learn how their investment selection process might be changing in light of COVID-19 and its related disruptions. We wanted to know how their investing cadence in Q1 2020 compared to the final quarter of 2019 and the prior-year period. We also asked if their focus had changed, how valuations have shifted and what their take on the LP market is today.

We heard back from Duncan Turner of SOSV, Alex Doll of TenEleven Ventures, Alex Niehenke of Scale Venture Partners, Paul Murphy of Northzone, Sean Park of Anthemis and John Vrionis of Unusual Ventures.

We’ll start with the key themes from their answers and then share each set of responses in detail.

Three key themes for raising in 2020

The VCs who responded haven’t slowed their investing pace — yet.

There’s likely some selection bias at work, but the venture capitalists who were willing to answer our questions were quick to note that they wrote a similar number of checks in Q1 2020 as in both Q4 2019 (the sequentially preceding quarter) and Q1 2019 (the year-ago quarter). Some were even willing to share numbers.


TechCrunch

UK mobile network operators have drafted a letter urging the government for greater clarity on Chinese tech giant Huawei’s involvement in domestic 5G infrastructure, according to a report by the BBC.

Huawei remains under a cloud of security suspicion attached to its relationship with the Chinese state, which in 2017 passed legislation that gives authorities more direct control over the operations of internet-based companies — leading to fears it could repurpose network kit supplied by Huawei as a conduit for foreign spying.

Back in April, press reports emerged suggesting the UK government was intending to give Huawei a limited role in 5G infrastructure — for ‘non-core’ parts of the network — despite multiple cabinet ministers apparently raising concerns about any role for the Chinese tech giant. The UK government did not officially confirmed the leaks.

In the draft letter UK operators warn the government that the country risks losing its position as a world leader in mobile connectivity as a result of ongoing uncertainty attached to Huawei and 5G, per the BBC’s report.

The broadcaster says it has reviewed the letter which is intended to be sent to cabinet secretary, Mark Sedwill, as soon as this week.

It also reports that operators have asked for an urgent meeting between industry leaders and the government to discuss their concerns — saying they can can’t invest in 5G infrastructure while uncertainty over the use of Chinese tech persists.

The BBC’s report does not name which operators have put their names to the draft letter.

We reached out to the major UK mobile network operators for comment.

A spokesperson for BT, which owns the mobile brand EE — and was the first to go live with a consumer 5G service in the UK last month — told us: “We are in regular contact with UK government around this topic, and continue to discuss the impact of possible regulation on UK telecoms networks.”

A Vodafone spokesperson added: “We do not comment on draft documents. We would ask for any decision regarding the future use of Huawei equipment in the UK not to be rushed but based on all the facts.”

At the time of writing Orange, O2 and 3 had not yet responded to requests for comment.

A report in March by a UK oversight body set up to evaluate Huawei’s security was damning — describing “serious and systematic defects” in its software engineering and cyber security competence, although it resisted calls for an outright ban.

Reached for comment on the draft letter, a spokesperson for the Department for Digital, Culture, Media and Sport told us it has not yet received it — but sent the following statement:

The security and resilience of the UK’s telecoms networks is of paramount importance. We have robust procedures in place to manage risks to national security and are committed to the highest possible security standards.

The Telecoms Supply Chain Review will be announced in due course. We have been clear throughout the process that all network operators will need to comply with the Government’s decision.

The spokesperson added that the government has undertaken extensive consultation with industry as part of its review of the 5G supply chain, in addition to regular engagement, and emphasized that it is for network operators to confirm the details of any steps they have taken in upgrading their networks.

Carriers are aware they must comply with the government’s final decision, the spokesperson added.

At the pan-Europe level, the European Commission has urged member states to step up individual and collective attention on network security to mitigate potential risks as they roll out 5G networks.

The Commission remains very unlikely to try to impose 5G supplier bans itself. Its interventions so far call for EU member states to pay close attention to network security, and help each other by sharing more information, with the Commission also warning of the risk of fragmentation to its flagship “digital single market” project if national governments impose individual bans on Chinese kit vendors.


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