Huawei Sells Honor Brand Amid Tightening Trade Restrictions

Huawei Sells Honor Brand Amid Tightening Trade Restrictions

Huawei founded Honor in 2013, and by 2015 it was operating in more than 70 countries. Huawei saw Honor has a blank slate that could help it expand into countries where consumers were less familiar with Huawei. The company focused mostly on budget devices, but it took a rather expansive view of that directive. Many of Honor’s phones were modified versions of Huawei devices with a few features stripped out and a lower price tag.

When the US Commerce Department took aim at Huawei, the Chinese megacorporation suddenly found its expansion plans stymied. Honor hasn’t suffered the same negative brand consequences, but US companies still can’t forge deals with it. That means it’s affected by the chip shortages and lack of Google support for Android. Just last week, rumors began to circulate that Huawei was going to throw in the towel and sell Honor, and that’s just what happened.

Huawei Sells Honor Brand Amid Tightening Trade Restrictions

According to an AP report, Huawei unloaded the Honor brand to a new holding company called Shenzhen Zhixin New Information Technology Co. This is a firm owned at least in part by the government of Shenzhen. Huawei, meanwhile, will not own any shares in the new company. Even with government backing, Honor is less likely to provoke security concerns because it will be smaller and won’t be involved with 5G infrastructure. The details of the sale are not public, but rumors point to something in the neighborhood of $15 billion. Huawei says Honor is selling 70 million smartphones per year, but analysts say Honor has seen a 27 percent drop in sales internationally as Huawei’s position has worsened.

A government-owned Honor will probably make some buyers uneasy, but this sale frees Honor of all those pesky trade restrictions. It will be able to buy materials from US companies and even partner with Google to pre-load apps like Gmail and Maps on phones outside of China. Huawei has said it’s running out of its custom Kirin mobile chips after TSMC was forced to sever ties, but Honor will be allowed to purchase chips from other companies. This could give it a chance to become a profitable smartphone maker without all that Huawei baggage.

Continue reading

Intel Launches AMD Radeon-Powered CPUs
Intel Launches AMD Radeon-Powered CPUs

Intel's new Radeon+Kaby Lake hybrid CPUs are headed for store shelves. Here's how the SKUs break down and what you need to know.

NASA’s OSIRIS-REx Asteroid Sample Is Leaking into Space
NASA’s OSIRIS-REx Asteroid Sample Is Leaking into Space

NASA reports the probe grabbed so much regolith from the asteroid that it's leaking out of the collector. The team is now working to determine how best to keep the precious cargo from escaping.

Intel’s Raja Koduri to Present at Samsung Foundry’s Upcoming Conference
Intel’s Raja Koduri to Present at Samsung Foundry’s Upcoming Conference

Intel's Raja Koduri will speak at a Samsung foundry event this week — and that's not something that would happen if Intel didn't have something to say.

AMD Buys FPGA developer Xilinx in $35 Billion Deal
AMD Buys FPGA developer Xilinx in $35 Billion Deal

The deal, which we discussed earlier this month, will give AMD access to new markets that it hasn't previously played in, including FPGAs and artificial intelligence.