Hello, This is Bien Perez from the South China Morning Post’s Technology desk, with a wrap of our leading stories this week.
About eight years ago, in a villa facing a lake in Shenzhen, a small group of senior Huawei Technologies executives headed by founder Ren Zhengfei held a closed-door meeting that lasted for several days.
Their mission was to brainstorm ideas on how Huawei should respond to the rising success of Google’s Android smartphone operating system (OS) around the world – software that it used on its own handsets. The underlying concern was that dependence on Android could render the company vulnerable to a US ban in the future.
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That future has finally come to pass. In the face of rigid trade sanctions imposed by the Trump administration, Huawei on Thursday announced that its proprietary Harmony OS would be installed on all of its smartphones from next year.
“The latest version of Harmony OS has been officially opened to developers globally,” said Richard Yu Chengdong, chief executive of Huawei’s consumer business group, at the company’s developer conference held in the southern city of Dongguan.
“The Huawei mobile service system now has 1.8 million app developers and 490 million active users, as well as 96,000 apps,” said Yu, adding that the company is accelerating the buildout of an app ecosystem around Harmony.
The OS initiative has been pushed forward after Huawei was added to the US Entity List in May last year. That barred Google from providing technical support for new Huawei smartphone models using Android, and from Google Mobile Services, the bundle of developer services upon which most Android apps are based.
Some analysts, however, are sceptical about the ability of Harmony to replace Android, particularly in overseas markets where many users take Google apps such as YouTube and Gmail for granted.
“Even if Huawei builds up more momentum with developers, they are swimming upstream trying to convince them to invest the time in migrating their apps over [from Android], especially for a relatively small installed base of users at the moment,” said Bryan Ma, vice-president of devices research at tech research firm IDC. “Moreover, Google itself is unlikely to make its first party apps available, which is the bigger problem.”
Huawei has said Harmony, a microkernel-based distributed OS, can be used in everything from smartphones to smart speakers, wearables and in-vehicle systems to create a shared ecosystem across devices.
The Harmony announcement came days after the Post reported that Huawei is trying to raise funds from its employees, as China’s biggest tech company struggles with the impact of US trade sanctions, citing three people familiar with the matter.
Huawei, also the world’s largest telecommunications equipment maker and currently biggest smartphone vendor, adopted a new rule on profit dividends that allows its employees to buy virtual shares worth 25 per cent of their income from the past five years, the people said. A Huawei spokeswoman declined to comment on Monday.
The clock is ticking for TikTok’s US sale
TikTok owner ByteDance will receive no extension from the Trump administration for divesting the short video-sharing app’s US business by September 15, even though Beijing asserts its right to extensively review any proposed deal.
“We’ll either close up TikTok in this country for security reasons, or it will be sold,” US President Donald Trump told reporters on Thursday before a campaign trip to Michigan. “There will be no extension of the TikTok deadline.”
Trump’s statement came as expectations rise that ByteDance is likely to miss the US deadline after new Chinese regulations complicated negotiations with bidders Microsoft Corp and Oracle Corp, according to a Bloomberg report, which cited people familiar with the matter.
In preliminary talks with Chinese government officials, ByteDance has been told any proposal must be submitted for approval with detailed information about technical and financial issues, and the review will be substantial and take time, one of the people said.
The bidders have asked ByteDance to get as much clarity as possible from Beijing on the new regulations, which prohibit the export of certain artificial intelligence technologies that TikTok uses, they said. A representative of the Beijing-based company offered no immediate comment.
On Wednesday, ByteDance was reported to have been in discussions with the Trump administration since last week about possible alternatives that would allow TikTok to avoid selling its entire US operation. Options include a sale that involves restructuring TikTok, one person was quoted as saying by The Wall Street Journal.
Analysts and bankers have estimated TikTok’s US business is worth at least US$20 billion, although the price would vary widely depending on what is included with the sale.
China cloud services demand surges in second quarter
Tech giants Alibaba Group Holding, Huawei, Tencent Holdings and Baidu led a jump in demand for cloud services in China in the second quarter, fuelled by increased demand for online services during the Covid-19 pandemic and government stimulus measures.
China, the world’s second-largest cloud services market, saw spending hit a record high of US$4.3 billion last quarter, up 70 per cent from a year ago, according to research firm Canalys in a report on Wednesday.
Alibaba Cloud, the digital technology and intelligence backbone unit of e-commerce giant Alibaba, had a 40.1 per cent market share in the second quarter. Alibaba is the parent company of the Post.
Huawei Cloud had a 15.5 per cent domestic market share in the June quarter, followed by Tencent Cloud with a 15.1 per cent share and Baidu AI Cloud with 8 per cent.
China’s accelerated adoption of cloud services last quarter is a testament to the increased demand for online collaboration and remote working tools, e-commerce, remote learning and content streaming as the country emerged from coronavirus lockdown.
And that’s all for this week. Until next time.
More from South China Morning Post:
- Huawei’s consumer chief says Harmony operating system will be rolled out on its smartphones in 2021
- Huawei in midst of US-China rivalry
- Taiwan exports surge to record amid Huawei scramble for chips
- Here’s what you need to know about Huawei’s Ark Compiler - which can port Android apps to new OS
- Huawei unveils smart displays under Honor brand equipped with alternative operating system to Android
This article Inside China Tech: can Huawei make sweet Harmony in 2021? first appeared on South China Morning Post