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Kevin Frayer
HiSilicon, part of Huawei Technologies, is shipping new Chinese-made chips for surveillance cameras, a fresh sign that the company is finding ways around U.S. export restrictions imposed in 2019, Reuters reported, citing people with knowledge of the matter.
Chip design unit, HiSilicon’s surveillance mission camera makers started this year and that at least some of the customers were Chinese, the report said added.
“These surveillance chips are relatively easy to manufacture compared to smartphone processors,” said a source with knowledge of the surveillance camera industry supply chain, noting that HiSilicon’s return would shake up the market.
At the end of August, Huawei surprised many by quietly launching its new phone, Mate 60 Pro. The company didn’t provide any information about the power of the chip inside, but people speculated that it could use a 5G-compatible chip. The Chinese tech giant was once in a race with Apple (NASDAQ:AAPL) and Samsung (OTCPK:SSNLF) to be the world’s largest mobile phone maker until U.S. restrictions starting in 2019 began limiting access to chip manufacturing tools needed to produce the most advanced models.
The semiconductor was made using a 7-nanometer process by Semiconductor Manufacturing International (OTCQX:SIUIF), according to a CNBC report citing an analysis of Mate 60 Pro conducted by software company TechInsights. The chip has raised concerns in the US and questions about how this was possible without the company having access to critical technologies.
On Tuesday, it was reported that Huawei could launch a 5G version of its mid-range phone Nova around October or November.
In March, Huawei noted that it had made breakthroughs in design tools for chips manufactured at and larger than 14 nanometers – two to three generations behind the leading technology, but progress for the company, the Reuters report said.
Before US export restrictions, HiSilicon was a major chip supplier to the surveillance camera sector, with brokerage Southwest Securities valuing the company’s global share at 60% in 2018. However, HiSilicon’s global market share fell to 3.9% in 2021, according to data from consultancy Frost & Sullivan.
HiSilicon mainly supplies chips for Huawei equipment, but also has external customers such as Dahua Technology and Hikvision.
HiSilicon has shipped a number of low-end surveillance chips since 2019, but the focus has been on the high-end arena and regaining market share from companies like Taiwan’s Novatek Microelectronics, according to the report.
According to some analysts, Huawei’s revival could be the biggest challenge for Apple in China, where the company is already facing several problems and increasing geopolitical risks.