Who benefits from the US restrictions on Huawei?

The US President Donald Trump put Huawei and dozens of its affiliates on its official Entity List, making it difficult for Chinese companies to purchase components from American merchants.

Besides telecommunication equipment that most other companies use, Huawei has also emerged as the world’s second-largest smartphones maker, just behind Samsung and ahead of Apple.

Must Read: Donald Trump is trying to murder Huawei: US-China Business Chief

In the 5G department: Sweden’s Ericsson, Nokia from Finland and South Korea’s Samsung are Huawei’s main competitors in the race to supply full-scale 5G network solutions.

As a result of restrictions, Nokia and Ericsson—two telecom heavyweights that control 17 and 13% of the 5G market, respectively—could get benefits. And while Nokia and Ericsson are big players in the 5G market, it’s actually Samsung that might be best positioned to receive the benefits of security concerns directed toward Huawei.

Why? Samsung is well resourced as the world’s leading manufacturer of smartphones and is able to manufacture the advanced chipsets that form a key part of 5G technology.

In the smartphone department: Samsung and Apple might be the biggest beneficiaries of Huawei’s demise. Other domestic Chinese brands such as Xiaomi and Oppo, are also likely to benefit from any dip in demand for Huawei devices.

Xiaomi, for example, was Europe’s No 4 smartphone maker by shipments in 2018, and already has a presence in markets like Spain, the UK, France, and Italy. Huawei had almost 25% of the European market as of the last quarter of 2018, according to Canalys data.

Let us know your thoughts on the above report. Who is getting the benefits?

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