Chip sanctions are kryptonite to Chinese tech ambitions. US blacklisting of Huawei has prompted a supplier exodus. Panasonic and Arm are the latest to flee. Arm’s decision to stop licensing microprocessor designs to the Chinese telecoms equipment group hurts most. Its designs dominate mobile chip technology. Arm may now play little part in China’s push to develop indigenous capabilities.
Samsung, Qualcomm and Apple are among the titans that use Arm architecture. The Android operating system, which Google has threatened to pull from Huawei phones, runs on Arm chips. They also power Huawei’s cloud servers and 5G base stations.
Huawei, which critics claim is linked to the Chinese military, did not see this coming. Its plan B included stockpiling imported microprocessors and sourcing others from wholly owned HiSilicon. But HiSilicon also uses Arm designs. Good homegrown alternatives would take years to create.