In the two years since 2018, the U.S. government’s sanctions and bans on Huawei have continued to escalate, from not allowing foreign companies to supply chips to Huawei to not allowing products containing U.S. technology to be supplied to Huawei. Why is the US government going to such lengths to sanction Huawei? Is it like the US imperialism is afraid of the rise of Huawei, as spread on the Internet? Or is it more specific that Huawei’s 5G technology is too advanced and that it cannot compete with the United States?
In fact, the answer is very simple-core skills. But don’t simply think that Huawei has core technologies that the United States does not possess and has been sanctioned. First of all, you need to understand what are core skills? What are the concepts and ideas about core skills at home and abroad? Let’s talk about foreign countries first. We can refer to several companies in the world that have brought core technologies to the extreme. One is ARM, a company that never produces processors but provides architecture design services to many processor manufacturers. Qualcomm, Apple, and Samsung want To develop new processors, you must obtain their architecture authorization from ARM before you develop a self-developed architecture. Now, Huawei’s Kirin and MediaTek’s Dimensity also use ARM’s architecture.
We can call this type of company “hidden champion”. It does not need to build an entire industrial chain to produce products like processors, because its establishment attracts attention and easily violates antitrust laws. Their approach is usually to show off in a low-key manner, and they sit on the most difficult to find but most critical links in the entire industrial process. ARM, for example, does not have any physical products and generates profits from licensing the architecture design that must be used by the processor. IBM has also directly separated most of its physical products from its own business, not because it does not make money, but because the cloud computing and cloud services they provide are far more profitable than the computer business. As a super industrial empire, Siemens is following the same path, except that it still retains some physical businesses such as high-precision medical equipment and large-scale heavy industrial equipment manufacturing, but the company’s focus has already shifted to the construction of Industry 4.0.
In our country, there are very few such companies. From the perspective of the mobile phone industry, if you look around, China Cool League and Red, Blue and Green Factory are basically just waving flags for their own product development conferences and stifling their desires at the same time. Each company has its own mobile phone products and each has its own selling points. Each company wants to make quick money by increasing its sales, rather than making thankless chips and systems. But you have to sell products, advertise, find people to bring goods, open online and offline experience stores, and deal with after-sales problems. You are so busy that those invisible champions are lying around collecting money. In fact, they would rather see your products. Mobile phone sales are increasing steadily. That is already good for them, so why does the United States suppress ZTE and Huawei?
You have to note that the United States is not suppressing Xiaomi, Oppo, vivo and Meizu, but ZTE and Huawei, and the time point is exactly the key point for the breakthrough of 5G technology. That is Huawei’s 5G number one in the world, so the United States is afraid? It’s a bit reluctant. The real reason is that ZTE and Huawei have woken up and truly understood the concepts and concepts of these foreign “hidden champions” about core technologies, and these concepts and concepts are exactly the “core technologies” that can lead a technology company to the future. “. That’s why these two companies are doing their best to develop 5G. Huawei has also begun to work on Kirin processors and Hongmeng systems. They have begun to learn from the routines of foreign companies and use core technologies as products instead of a mobile phone and a computer. When a worker who makes dumplings by hand stops making dumplings so hard and turns to researching more delicious dumpling fillings, it naturally violates the interests of the owner of the original filling recipe.
Another aspect is even more magical. Let’s first talk about a professional giant with a market share of 80% in the field of lithography machines – Dutch ASML. The U.S. government’s ban on Huawei in May was due to the fact that the lithography machines used by TSMC to make chips for Huawei are theirs, and there are American skills in them. ASML’s photolithography machines are naturally physical products, so are they still considered a “hidden champion”? Of course, of course, AMSL must have a lot of its own unique skills in the design and manufacture of lithography machines. The design patents for core components and the secret formula of the composition materials are all core skills, but these are not enough.
You have to imagine a question. Lithography machines are very profitable. Several other countries, such as the United States, a big technology country, and Germany, a neighbor of the Netherlands and an old industrial power. Why haven’t they made more efforts to surpass the Netherlands in lithography machines? This involves the exchange of heterogeneous equivalents of central skills. A simple example is that Intel in the United States is a major customer of ASML. Their processors are all made with ASML’s lithography machines. However, ASML will not strangle Intel’s neck and raise prices because ASML designs and inspects lithography machines. The computers and servers that arrived were built through the channels of Intel and Microsoft. If the two US companies cut off supply, ASML would not be able to operate. Therefore, the two companies each use their own core skills to communicate and work together to achieve mutual benefit.
You will find that the industries in which these companies are located will form a benign unspoken rule under their leadership. Countries such as Britain, Germany, France, Italy and the United States will not salivate at the Netherlands’ lithography machine industry. Instead, they will have a tacit attitude, because it is impossible for one country to develop all the world’s cutting-edge technologies. You have your interests, and I have my advantage. They know that their country must have core skills that the other party does not have to carry out reciprocal transactions. Of course, this transaction is not an exchange of goods, or may simply be measured by price.
For another example, you may be more familiar with it. There are three giants in the global civil aviation engine field, General Motors, Rolls-Royce and Pratt & Whitney. Each of their engines is not fabricated out of thin air. Every part is produced by themselves, and ultimately an engine is produced. It is the result of hundreds of manufacturers around the world using their respective core skills to produce the parts they are good at, and then gathering together to assemble them and collaborate together. It is somewhat similar to my country’s concentrated efforts to do big things. A number of large and small companies in each country can benefit from it and achieve simultaneous development. What’s more interesting is that you will find that the market share of the three giants General Motors, Rolls-Royce, and Pratt & Whitney in the field of civil aviation engines has basically remained at around 40%, 20%, and 10%. There has not been much change in the past few years. This is because Thanks to the balanced agreement reached between them, it can also be said to be a tacit understanding. After all, in the field of aero-engines, fighting is not the way to survive. Even the party with a small scale that is eliminated is still connected to hundreds of companies. Benefit. This kind of benign unspoken rules and tacit understanding in the industry is a “core skill” formed by companies like them that have been deeply involved in the market for many years.
Of course, there are conditions for the equivalent exchange and win-win cooperation of core skills. This condition is that the value brought by your core skills can be communicated on an equal basis with the other party, and perhaps you have the qualifications to make the other party feel worthy. Collaborate. Unfortunately, the domestic mobile phone market obviously does not have the accumulation of core skills required to meet this requirement. At this time, you want to use their routines to get a share of the pie, or you want to change the underlying market rules that they have formed over many years of operation. Naturally, someone will stand up and say “no”. This is the underlying reason why the United States and several other countries have imposed sanctions on Huawei.
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