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The capture of Huawei puts “Bullseye” on Apple

Apple shoots 20 % of its global revenue in China

You do not need to look closely to see how the Global Times ̵

1; the state-backed Chinese newspaper – interprets the arrest of Huawei’s chief financial officer, Meng Wanzhou.

“Washington’s action to smother Huawei will undermine,” reads a headline. “The ban made to Chinese companies such as Huawei isolate the United States from the digital economy of the future,” is another.

This is the second title, the threat of isolation, which should give US technology companies a considerable break as we approach Ms. Meng’s day. detention in a Canadian prison.

The fallout from his arrest will certainly mean, at the very least, an even more difficult relationship for the handful of American tech giants who have found a big fortune in China.

In particular, Apple, the standard bearer of American technological success, and a company that relied on China for 20% of its revenues this year.

” without proportional transparency, their organizations won’t shoot no favorable position of the Chinese advanced economy. ”

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Blocked Sales

” Look, “said Dan Ives analyst of the Wedbush investment company, “the situation of Huawei’s chief financial officer … it’s the last straw that could break the tide.”

China has long held that the US is unfair to its big tech companies – especially Huawei, which is the closest thing to the country compared to a real competitor of Apple, even if its annual turnover is not yet close (266 billion USD for Apple against approximately 100 billion USD for Huawei ), the company managed to drive the global sales of Apple smartphones earlier this year. Huawei is now second only to Samsung.

Tuesday, a Chinese court banned the sale of old models of iPhone in the context of a long patent infringement lawsuit between Apple and Qualcomm. Most legal observers expected China to reject Qualcomm’s request for an injunction.

There is no direct link between this action and the Huawei row. But in the context of Ms. Meng’s arrest and ongoing tariff disputes, he is perceived as a stout display on the part of the Chinese.

But Huawei’s real success will not come from smartphones, but the equipment that makes them worth it to have. Huawei is positioned as the supplier of choice for the deployment of 5G technology, the next generation mobile network.

Simply put, if China thinks that the United States unfairly hinders the opportunity for Huawei to be a major player in 5G, they could retaliate and Apple could suffer the consequences.

“The last thing technology investors wanted to see was this news about Huawei’s CFO,” said Ives.

“This fuels the flames of further retaliation.”

Apple draws 20% of its global revenue from China

A Gentle Protest 

  1. Ives said that Apple must have the impression of having a lead eye on the back.

Wedbush estimates that 350 million iPhones used around the world are nearing the point where most users would like upgrades, including about 70 million in China.

“You talk about a quarter of the extra growth over the next three or four years from China.”

Even in the absence of an official intervention, the advertising suffered by Apple could suffer Chinese income Outside the court in Vancouver, members of the Chinese community in the city expressed their feelings, holding “Free Meng” signs and telling reporters that they thought the United States was brutalizing Huawei and, by extension, China.

In a note obtained by Yahoo News, a number of Chinese companies have taken steps to promote their employees to use Huawei products instead of Apple.

“The news of the arrest of the financial director of Huawei, Miss Wanzhou, by the Canadian authorities shocked the Chinese people” to the staff of Jiangxi Ruike Refrigeration Technology reportedly said, encouraging employees to exchange their iPhone for Huawei device (in exchange for a substantial subsidy).

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However, Apple’s success in China could well mean Beijing’s anger, even if Ms. Meng finds herself extradited and even imprisoned.

Of course, Apple does not only sell products to China, it manufactures them there. In 2017, Apple estimated that between manufacturing, retail and distribution – not to mention those who developed its software – it was responsible for 4.8 million jobs in China.

In addition, the company has opened research centers that host China’s brightest graduates.

“They have relations with the Chinese government because they are an imposing employer,”

Apple did not respond to requests for comment.

 

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