Google suspends some business with Huawei

Alphabet Inc's Google

has suspended business with Huawei that requires the transfer of

hardware, software and technical services except those publicly

available via open source licensing, a source familiar with the

matter told Reuters on Sunday, in a blow to the Chinese

technology company that the US government has sought to

blacklist around the world.

Holders of current Huawei smartphones with Google apps,

however, will continue to be able to use and download app

updates provided by Google, a Google spokesperson said,

confirming earlier reporting by Reuters.

"We are complying with the order and reviewing the

implications," the Google spokesperson said.

"For users of our services, Google Play and the security

protections from Google Play Protect will continue to function

on existing Huawei devices," the spokesperson said, without

giving further details.

The suspension could hobble Huawei's smartphone business

outside China as the tech giant will immediately lose access to

updates to Google's Android operating system. Future versions of

Huawei smartphones that run on Android will also lose access to

popular services, including the Google Play Store and Gmail and

YouTube apps.

"Huawei will only be able to use the public version of

Android and will not be able to get access to proprietary apps

and services from Google," the source said.

The Trump administration on Thursday added Huawei

Technologies Co Ltd to a trade blacklist, immediately

enacting restrictions that will make it extremely difficult for

the company to do business with U.S. counterparts.

On Friday, the US Commerce Department said it was

considering scaling back restrictions on Huawei to "prevent the

interruption of existing network operations and equipment". It

was not immediately clear on Sunday whether Huawei's access to

mobile software would be affected.

The extent to which Huawei will be hurt by the U.S.

government's blacklist is not yet known as its global supply

chain assesses the impact. Chip experts have questioned Huawei's

ability to continue to operate without help from the United

States.

Details of the specific services affected by the suspension

were still being discussed internally at Google, according to

the source. Huawei attorneys are also studying the impact of the

blacklist, a Huawei spokesman said on Friday.

Huawei was not immediately reachable for further comment.

Chipmakers including Intel Corp, Qualcomm Inc

, Xilinx Inc and Broadcom Inc have

told their employees they will not supply critical software and

components to Huawei until further notice, Bloomberg reported https://bloom.bg/2VLT5QK

late on Sunday, citing people familiar with the matter.

Intel, Qualcomm, Xilinx and Broadcom did not immediately

respond to requests for comments on the Bloomberg report.

Representatives of the U.S. Commerce Department did not

immediately comment.

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Huawei will continue to have access to the version of the

Android operating system available through the open source

license, known as Android Open Source Project (AOSP), that is

available for free to anyone who wishes to use it. There are

about 2.5 billion active Android devices worldwide, according to

Google.

However, Google will stop providing Huawei with access,

technical support and collaboration involving its proprietary

apps and services going forward, the source said.

Huawei has said it has spent the last few years preparing a

contingency plan by developing its own technology in case it is

blocked from using Android. Some of this technology is already

being used in products sold in China, the company has said.

In an interview with Reuters in March, Eric Xu, rotating

chairman of Huawei, struck a defiant note in anticipation of

retaliatory actions by U.S. companies. "No matter what happens,

the Android Community does not have any legal right to block any

company from accessing its open-source license," he said.

Popular Google apps such as Gmail, YouTube and the Chrome

browser that are available through Google's Play Store will

disappear from future Huawei handsets as those services are not

covered by the open source license and require a commercial

agreement with Google.

But users of existing Huawei devices who have access to the

Google Play Store will still be able to download app updates

provided by Google. Apps such as Gmail are updated through the

store, unlike operating system updates which are typically

handled by phone manufacturers and telecoms carriers, which the

blacklist could affect, the source said.

The impact is expected to be minimal in the Chinese market.

Most Google mobile apps are banned in China, where alternatives

are offered by domestic competitors such as Tencent and Baidu.

In Beijing, foreign ministry spokesman Lu Kang said the

ministry had noticed the report and would look into it and pay

attention to developments.

"At the same time, China supports Chinese companies to use

legal weapons to defend their legitimate rights," he added, but

did not elaborate.

Huawei's European business, its second-biggest market, could

be hit as Huawei licenses these services from Google in Europe.

"Having those apps is critical for smartphone makers to stay

competitive in regions like Europe," said Geoff Blaber, vice

president of research, CCS Insight.

Reuters