Qualcomm warns the US government: If it does not sell chips to Huawei, it will give away $8 billion of market share to its competitors every year

According to a report by the Wall Street Journal on August 8, US chip giant Qualcomm is lobbying the Trump administration, calling for the removal of restrictions on the company's sales of chips to Huawei.

The report cited a Qualcomm briefing as saying that the company told U.S. policymakers that their export ban would not prevent Huawei from obtaining necessary components, but would instead hand over an $8 billion annual market to its overseas competitors.

The Trump administration has been trying to cut off Huawei's supply chain. In May 2019, the US Department of Commerce added Huawei and its 70 branches to the "Entity List", prohibiting Huawei from purchasing from US corporate suppliers, but has since repeatedly extended its "temporary license."

Until May 15 this year, the United States again announced the extension of Huawei's "temporary license" to August 13. At the same time, the U.S. Department of Commerce introduced new regulations: even if the chip itself is not developed and designed in the United States, as long as foreign companies use U.S. chip manufacturing equipment, they must obtain permission from the U.S. government to provide chips to Huawei or its affiliates.

Qualcomm said the restriction "inadvertently created a significant money-making opportunity for two of Qualcomm's overseas competitors."

Qualcomm said the two rivals it refers to are Taiwan's MediaTek and South Korea's Samsung Electronics. Qualcomm said the US government's measures will hinder US research and "leadership" in the 5G field, which is "an unacceptable outcome" for US interests.

The report said that Qualcomm believes that obtaining permission to trade with Huawei will bring billions of dollars in revenue to the company and help fund the development of new technologies. On the contrary, it will not only make it cheaper for its overseas competitors, but also have "little impact" on Huawei because the latter can purchase from other places.

It is worth noting that this lobbying comes at a time when Qualcomm is resolving its patent dispute with Huawei. Qualcomm's financial report shows that the company has reached a settlement agreement with Huawei in July this year and signed a long-term and global patent license agreement to authorize Huawei to use Qualcomm's patented technology. Qualcomm said that according to the settlement agreement, the company will receive about $1.8 billion in related revenue from Huawei.

The Wall Street Journal quoted a source as saying that before the two sides reached a settlement, Qualcomm had applied to the US government in June this year for a license to sell 5G chipsets to Huawei.