Taiwanese chip maker, TSMC has been a close associate of Huawei. Over the past two 7nm generation chips, Huawei was the first to use these manufacturing processes. As Huawei surpasses Apple to become the world’s second-largest smartphone manufacturer, it also needs the support of foundry partners. However, the latest news claims that TSMC has reduced its capacity support for Huawei. Nevertheless, the two parties still maintain close cooperation on future advanced processes such as 5nm and 3nm.

Some analysts speculate that TSMC’s move is to accommodate other large customers, such as Apple, which is preparing the A13 chip “iPhone 9” / 5nm A14 processor. There have also been reports that the US is considering the revision of the “Foreign Direct Product Rules” to include some TSMC products that use US technology. The US is planning to regulate the supply of chips to Huawei. Especially when the chip uses US technology in part.

For Huawei, if TSMC reduces its production capacity, it does not have much impact. This is because Huawei has multiple options including Samsung’s 7nm and 5nm processes. There are reports that the third-generation 5G baseband series X60 released by Qualcomm last night chose Samsung’s 5nm foundry. This seems to suggest that the manufacturing process is reliable.

If the US continues this way, manufacturers will soon start avoiding US technology. It’s quite disheartening that the US wants to control who chip makers sell to because the chip uses a small percentage of US technology.