Huawei- The Dark Horse of the Smartphone Revolution

By Kirsten Wilfred Coelho

Image courtesy: Reuters

Once considered to be the hub for smartphone innovation worldwide, Huawei phones are now back in the limelight. In 2019, several tech experts worldwide called it a sad day when the USA put Huawei mobiles on the “Entity” list, which basically translated into a complete ban on the sales of the phone on US territory. The then-Trump administration went to the extent of preventing major service providers like Google from dealing with Huawei, meaning that the phone itself was now rendered useless. Despite such a massive setback, Huawei rose back into the spotlight by innovating better than ever. While companies outside of China struggle to create a folding or flipping phone, Huawei was the first to come up with a “tri-fold phone” with a whopping tablet-sized display of 10 inches. Further, the brand is also known for being the pioneer of 5G technology, with several nations like Switzerland having actually procured the capability from China via Huawei. While all of these features sound extremely tech-oriented, the rise of Huawei is tied closely to diplomacy and the novel style of Chinese governance (Ryan & Burman, 2024). One could easily draw a contrast between Chinese and American governance styles and their interactions with technological revolutions via the Huawei example (Balbontin, 2025). 

1. Introduction – The Ban:

Let us first dive into what led to the Huawei ban in the US. The Trump 1.0 administration had added the brand to its “Entity” list via the Department of Commerce, solely stating “national security” as its reason (Lee-Makiyama & Baker, 2024). This fear of sensitive information being at risk stems from a variety of reasons. Companies in China are often compelled to assist in intelligence work and are even forced to keep this a secret. Further, Huawei as a brand does not have a clear top-level leadership due to its “virtual shares” style of ownership, which shall be discussed later. The ban by the US  meant that neither Huawei nor 68 of its affiliates could engage with business in the US. Unfortunately, this also means a striking attack on Huawei’s business in other countries. The USA, being the current centre for IT-related activities, has now cut off its support to Huawei. Major companies like Google cut off the support it provided in terms of UI, meaning that the phone no longer had an operating system to function properly. This basically broke the very foundation for further phone sales. Several experts called this unfair, and many even stated that the entire act of banning Huawei was merely a reaction of American Big Tech fearing Huawei’s capabilities. Huawei’s success in terms of innovation has always threatened other brands, given that they were one of the first to include features like triple cameras or photography-centric phones. Regardless of this, however, most American brands like Qualcomm and Google had their own losses owing to the ban. Intel, for example, lost access to a major collaborator, and this consequently led to Intel lobbying for Huawei. On the other hand, one must note that there is enough need to question Huawei as a security threat, but surely not enough to outright ban it. One of the many reasons is the opaque governance within the company’s structure. Huawei has a very unusual style of organisation since 99% of its shares are owned by members of the labour union in terms of virtual shares, while only 1% is owned by the founder, Zhengfei (Wang, 2021). Further, there is no clear understanding of who drives internal appointment decisions.

More importantly, let us note the manner in which China pursues its intelligence work on other countries via compelling Chinese-based companies as part of its “National Intelligence Law”. Despite these claims (Miller & Chevalier Chartered, 2019), there has been no concrete evidence to prove intelligence attacks via the phone other than Huawei’s own alleged espionage attempts on other companies. This refers to the T-Mobile incident of 2012, wherein Huawei employees allegedly stole crucial information with regard to a smartphone robot and shared the same with engineers in China in order to recreate it. 

Whether the ban was justified or not, the company was forced into reorganising itself and finding ways to sustain. The ban resulted in the company facing a 30% decline in stocks by 2021. The situation was grim since the lack of access to US-based supply chains for advanced semiconductors meant that the company now had to redesign the same, all by itself. It was forced to sell off its Honor sub-brand in order to stay afloat. This entire struggle became a focal point of the US-China trade war. The entire process of separating US-based companies from Huawei was seen as a decoupling of trade chains in the US from China. In fact, the company was forced into finding an alternative market, and this was done by catering to parts of Asia and Africa where unrestricted trade was allowed (Baker McKenzie, 2020). Global trade bodies such as the WTO have remained outside of the ban discussions, especially because they allow for countries to bar companies on grounds of “national security”. Despite Chinese appeals against the loss of 5G contracts in Australia, the WTO could not be involved.

2. Huawei’s continued innovation:

The major task for Huawei was now to develop its own operating system in order to be able to design and sell newer phones. This alone speaks largely of how the Chinese markets and industries functioned post the ban. Huawei began developing HarmonyOS, which utilised an open-source Android library but later evolved into a fully independent ecosystem. It is very important to understand that globally, up until that point, only 2 brands fully succeeded in owning their own operating systems. One was Apple, and the other was Google, from which Google often allowed other companies to base their UI on the Android interface. The very act of developing one’s own independent OS was seen as a Herculean task, and it was only Chinese brands like Xiaomi that were praised for the level of customisation undertaken with the Android library. 

Huawei has seen a substantial acceptance within China. It surpassed Apple’s OS in 2025 and has become the second most popular mobile OS in China. This marks a significant shift in the Chinese market, which would never have occurred if not for the trade ban. On the other hand, the OS has also come under great scrutiny since several nations, especially the US, have warned against possible snooping activities by the Chinese government via the OS. Despite these claims, the rise of Harmony OS has been a mark of China’s resilience and technological capabilities (Balbontin, 2025). It has become a reflection of the depth that comes with the ongoing trade war. 

Another crucial aspect, as well as a praised feature of Huawei post the 2019 ban, was its work on 5G communication technology. It is necessary to pay heed to the Chinese government's efforts in this regard. 5G was set as a national priority, and allocation of the spectrum went to several state-owned telecom operators. Note that all of this occurred back in 2018-19, while countries like India have gained the technology and undertaken the spectrum allocation only in recent years. Local governments in China provided subsidies, tax breaks and even land-use rights to telecom companies in order to facilitate this infrastructure (Kirton, 2024). A whopping CNY150 million was offered to each operator to allow for the move. By 2025, China had built roughly 4.5 million 5G base stations. In order to understand the scale of this feat, one must note that India currently has roughly half a million 5G-equipped mobile towers, while the USA also falls behind in terms of coverage. While these are Chinese state estimates, even global organisations like the GSMA have estimated at least 4.2 million towers. The very scale of this Chinese effort is impossible for other nations, if not for the style in which the Chinese function as a government. The ease with which funding as well as rights were given to companies is surely not possible without the centralised and authoritative governance. 

Huawei was at the very centre of this rise since it was the primary supplier of 5G equipment. Government support, as well as high demand, helped account for its losses while also boosting its presence nationwide. China is now a global leader in 5G technology (Kirton, 2024). 

3. Current state of affairs:

Despite the positive growth, countries across the globe have lost faith in Huawei’s integrity, especially with the USA cautioning everyone about the risks of Chinese spyware. As of now, the phone is completely banned from all US 5G networks. The Australian government also banned it from its 5G networks, while countries like New Zealand, Japan and Taiwan have followed suit. Sweden was one of the first nations in the European Union to ask for the removal of existing Huawei equipment from the 5G tech. As for Huawei phones, the devices are currently available in the Middle East, Asia Pacific, Europe, Latin America and Africa. Availability of recent launches, such as the 2-fold Mate XT “trifold” phone, has been limited despite announcements of global release. Despite an increase in shipments to countries outside China (Huawei Central, 2025), Huawei lags seriously behind Samsung and the iPhone. As for the European market, despite the presence of Huawei phones, the lack of Google support hampers their capability (Buchholz, 2020). The lack of essential apps such as Play Store, Gmail and YouTube has rendered these phones rather useless. Huawei has tried to make up for the gap by pushing its own independent system. 

Access to Huawei phones can sometimes be seen as an indicator of good ties with China. Despite the threat of intelligence threats, several countries have allowed for the use of these devices. Expansion in regions like Latin America is closely tied to policies such as the Belt and Road initiative. A major example would be that of Brazil, where Huawei built a $120 million rural telecom network and invested $800 million in a 5G manufacturing plant. Such moves contribute significantly to a country’s infrastructure and are indirectly a means of Chinese investment. Another example would be that of Vietnam, which recently improved ties with China when its telecom provider, Viettel, awarded contracts to Huawei. This access to another nation's internet infrastructure has resulted in China gaining a form of “digital infrastructure” leverage over another country. Further, the fact that Huawei devices are often known for offering high quality at substantially low prices makes it a possible competitor to US brands if not for the unexpected ban. It is important to note that several countries see access to Huawei more as a business decision than as a political endorsement. Many often allow for the sale of the product but restrict access to 5G networks, fearing data leaks. 

4. The Indian perspective:

One of the many ways to understand India’s approach would be the manner in which India avoided companies like Huawei while inviting 5G trials. Only “trusted sources” were allowed, and Huawei was not certified as trusted, though India did not impose an outright ban (Gadgets Now, n.d.). This balance of security checks alongside subtle diplomacy is proof of India aligning with the Western approach while also ensuring smooth relations with China. The 5G-related decision came at a time when the Indo-China border issue had also flared up. More importantly, loss of access to several US-based utilities, such as the Google Play Store, has rendered Huawei phones almost useless in India. Despite considerable popularity, the phone’s market share in India dipped to 0.41% as of 2025.

The American ban on Huawei led to several implications worldwide. The manner in which the Trump administration approached the matter has stripped the smartphone of most utilities in countries other than China. Further, countries across the world have been concerned with intelligence threats, but only some have voiced these openly in the form of bans and restrictions, while others have done so in a subtle manner. This highlights a key dynamic in geopolitics where trade decisions, and more importantly, the manner in which a decision is voiced, speak volumes about a country’s ties with another.

5. Conclusion:

China has worked especially hard to establish itself as one of the leaders in innovation globally. This success has been restricted by unfair competitive practices as well as grave concerns over intelligence attacks. Despite such setbacks, the nation has still allowed for a domestic economic boom via domestic innovation. It has often allowed brands like Huawei to spearhead sectors that require heavy funding as well as technological investment. One must, however, note that such freedom comes with the threat of the Chinese state having a strong say in one’s private activities. US fears of Chinese infringement on the practices of domestic private players are often quite true, and this has been proven time and again via the examples of other companies. Hence, China’s smartphone market remains vague but also showcases high potential in terms of innovation.

References:

1. Ryan, M., & Burman, S. (2024). The United States–China ‘tech war’: Decoupling and the case of Huawei. Global Policy, 15(2), 355–367. https://doi.org/10.1111/1758-5899.13352

2. Lee-Makiyama, H., & Baker, R. (2024). How Huawei weathered the storm: Resilience, market conditions or failed sanctions? (ECIPE Policy Brief No. 03/2024). European Centre for International Political Economy. https://ecipe.org/publications/how-huawei-weathered-the-storm-resilience-market-conditions-or-failed-sanctions/

3. Balbontin, R. (2025, October 27). Backfire: Export controls helped Huawei and hurt U.S. firms. ITIF. https://itif.org/publications/2025/10/27/backfire-export-controls-helped-huawei-and-hurt-us-firms/ 

4. Miller & Chevalier Chartered. (2019, May 28). Trade Compliance Flash: U.S. adds Huawei and its affiliates to the Entity List; issues landmark new telecommunications security Executive Order. https://www.millerchevalier.com/publication/trade-compliance-flash-us-adds-huawei-and-its-affiliates-entity-list-issues-landmark-new-telecommunications-security-executive-order

5. Baker McKenzie. (2020, August 17). US Commerce Department expands Huawei- and Entity List-related rules, further restricting Huawei’s access to semiconductors produced from U.S. technology and software. Global Sanctions & Export Controls Blog. https://sanctionsnews.bakermckenzie.com/us-commerce-department-expands-huawei-and-entity-list-related-rules-further-restricting-huaweis-access-to-semiconductors-produced-from-us-technology-and-software/

6. Wang, Z. (2021, February 1). Who really owns Huawei? A response to Professors Balding and Clarke. Pekingnology. https://www.pekingnology.com/p/who-really-owns-huawei-a-response

7. Kirton, D. (2024, June 27). Huawei’s Harmony aims to end China’s reliance on Windows, Android. Reuters. https://www.reuters.com/technology/huaweis-harmony-aims-end-chinas-reliance-windows-android-2024-06-27/

8. Buchholz, K. (2020, January 30). Chart: Which countries have banned Huawei products. Statista. https://www.statista.com/chart/17528/countries-which-have-banned-huawei-products/

9. Huawei Central. (2025, May ? — 2025). Huawei global smartphone shipment grew 28% YoY in first quarter of 2025. Huawei Central. https://www.huaweicentral.com/huawei-global-smartphone-shipment-grew-28-yoy-in-first-quarter-of-2025/

10. Gadgets Now. (n.d.). Huawei mobile phones in India. Bennett, Coleman & Co. Ltd. https://gadgetsnow.indiatimes.com/mobile-phones/brand/Huawei-mobile-phones-in-india

( Kirsten Wilfred Coelho is a Research Intern at the Chennai Centre for China Studies. The views expressed here are that of the author's and do not reflect the views of C3S.)