Huawei has built its own operating system for smartphones and computers in case it is suddenly blocked from using U.S. software from Microsoft and Google, the Chinese company confirmed to CNBC on Friday.
The world’s second-largest smartphone player by market share currently uses the Google-developed Android mobile operating system for its handsets and Microsoft’s Windows for its laptops and tablets.
Richard Yu, the CEO of Huawei’s consumer division, told German publication Die Welt in a recent interview, that the company had a back-up operating system, if for some reason, it was blocked from using American-made software.
“We have prepared our own operating system. Should it ever happen that we can no longer use these systems, we would be prepared,” Yu said, according to a translation of the original German text.
“That’s our plan B. But of course we prefer to work with the ecosystems of Google and Microsoft.”
Yu’s comments were confirmed to CNBC by a Huawei spokesperson on Friday who said the back-up systems would only be used in “extenuating circumstances” and were “there for basic business continuity in a worst-case scenario.”
“We don’t expect to use them and to be honest, we don’t want to use them. We fully support our partners’ operating systems — we love using them and our customers love using them,” the spokesperson said.
Those “extenuating circumstances” could be a nod toward the troubles rival Chinese firm ZTE faced last year. The U.S. government banned American firms from selling parts and software to ZTE because the Chinese company violated sanctions on Iran and North Korea. Its ability to use Google’s Android was under threat, Reuters reported at the time.
In other regards, though, Huawei has been trying to wean itself off of American technology. The company has made a big play in semiconductors and now designs its own chips for its smartphones. However, some its laptops still use American components from companies like Intel.
A new operating system (OS) could provide some problems for Huawei, particularly if it is forced to stop using Microsoft and Google software outside of China. Inside its home market, Google services are blocked, including the Play Store. But internationally, Google’s app store is available.
“For Huawei, almost half of its smartphone sales come from China. So 50 percent of the business is anyways secured as Google mobile services — the Play Store is non-existent in China. However, having no access to Google Android and Play Store could affect the other half of the business quite a bit in the near-to-mid-term,” Neil Shah, research director at Counterpoint Research, told CNBC on Friday.
“What Huawei has up its sleeves as an Android and Play Store alternative is not proven though it could have a capability of running third party Android app stores which could alleviate some concerns from the developers and apps perspective. However, users which are fully immersed into Google services might give … Huawei’s own OS a pass initially until (it has been) proven to run services and a user experience as good as Google’s,” Shah added.
Huawei has faced intense political pressure from the U.S. which has alleged its networking equipment may contain backdoors that could be used by the Chinese government for espionage. The company has repeatedly denied the claims, but intelligence experts who spoke to CNBC, were skeptical about Huawei’s assurances. They point to China’s national security laws which allegedly mean every domestic company is legally obliged to help the government with intelligence gathering.
Meanwhile, Huawei’s CFO Meng Wanzhou, who was arrested in Canada in December, is facing extradition to the U.S. She has been accused of fraud.
Huawei has gone on the offensive in the last few weeks, most recently suing the U.S., alleging that a law that bans government agencies from buying the Chinese technology giant’s equipment is unconstitutional.
While the pressure on the Chinese tech giant from governments has focused on Huawei’s networking equipment, its consumer division has been largely kept away from the negative headlines. Its smartphones have been absent from the U.S. market for several years, but it has enjoyed success around the rest of the world. Last year, it overtook Apple to become the world’s second-largest smartphone maker by market share — just behind Samsung.
Huawei’s consumer business CEO, Richard Yu, told CNBC in an interview in November that the company believes it can be the top smartphone seller by 2020 and also revealed plans to launch augmented reality glasses.