Google's decision to suspend Huawei's use of some parts of the Android operating system will send shockwaves through the smartphone market. Huawei is the second biggest smartphone maker but relies on the Android operating system, which is effectively run by Google, as the engine of its devices. Google will block Huawei's use of Android updates, apart from those made available in the open-source version of the operating system, according to Reuters.
In a statement Huawei said: "Huawei has made substantial contributions to the development and growth of Android around the world. As one of Android's key global partners, we have worked closely with their open-source platform to develop an ecosystem that has benefited both users and the industry.
"We will continue to build a safe and sustainable software ecosystem, in order to provide the best experience for all users globally," it said.
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"Huawei has created highly competitive hardware but Google services and Android OS are still critical to consumers in international markets. Losing Google's mobile services will be detrimental to Huawei's smartphone business," said analyst firm Canalys, noting that Huawei had a "stellar" first quarter in Europe
"Huawei smartphone supply freeze would trigger serious channel and market disruption," it said.
And Carolina Milanese, a tech analyst at Creative Strategies, tweeted: "This will have a huge impact on #Huawei in Europe the star market outside of China. It will be interesting to see if there are workarounds but as much as Huawei is key to Android gov't and enterprise market are key to Google."
Google's move comes after the US Department of Commerce last week added Huawei to its 'Entity List' because the department said it had information that led it to conclude that Huawei is engaged in activities that are contrary to US national security or foreign policy interest. US companies cannot transfer technology to a company on that list without a licence from the US government.
At the time, Huawei said the move would do significant economic harm to the American companies with which Huawei does business, affect tens of thousands of American jobs, "and disrupt the current collaboration and mutual trust that exist on the global supply chain".
What does this mean for current Huawei smartphones?
Google has said that for current Huawei users nothing changes yet. "We assure you while we are complying with all US gov't requirements, services like Google Play & security from Google Play Protect will keep functioning on your existing Huawei device," it said.
Huawei has said that it will continue to provide security updates and after-sales services to all existing Huawei and Honor smartphone and tablet products, covering those have been sold or still in stock globally.
However, it's unclear whether, when future versions of Android arrive, it will be possible to upgrade your Huawei smartphone.
What does this mean for future Huawei smartphones?
While Android is often described as an open source smartphone operating system, in reality many of the features that customers really use the most, like the Google Play store or Google Maps, are largely proprietary apps owned by Google.
As it stands, it seems that future versions of Huawei devices will not be able to use some of the services that Google has built on top of Android. That would mean Huawei would be limited to the open source version of Android, which provides the basic smartphone functions. One option will be to build up services -- just as Google has done -- on top of that basic framework.
Huawei has already revealed that is has had a back-up plan in place for eventualities like this. "We have prepared our own operating system. Should it ever happen that we can no longer use these systems, we would be prepared. That's our plan B. But of course we prefer to work with the ecosystems of Google and Microsoft," said Richard Yu, chief of Huawei's consumer group told a German newspaper earlier this year. The company also said: "Android and Windows will always remain our first choices."
But Forrester's principal analyst Charlie Dai said: "This move will have critical impact toward Huawei's business around smart phones. Huawei has its own mobile OS as a backup, but it's not fully ready yet and it's very difficult to build up the ecosystem as what Huawei has been doing on Android."
What does all of this have to do with 5G?
This chain of events really has little to do with Huawei smartphones (the company actually sells very few in the US), and has come about largely because of the ongoing row about 5G, security and Huawei. The US government has been increasing concerned about Huawei's networking technology being used to power 5G networks around the world. It warns that using Huawei means the Chinese government might be able to force the company to spy on customers or communications running over the network. As 5G is going to be a fundamental building block for new services like smart cities, the Internet of Things and self-driving cars the US and some of its allies are worried that the risk of using Huawei is too great. Huawei has denied that its technology could be used by the Chinese government in such a way.
What's the impact of this likely to be?
Assuming the suspension stays in place long term this could have a serious impact on Huawei, forcing it to rapidly build up an alternative to the Android services on its phones, particularly in Europe where's its growth has been strongest. It won't have much affect on its China business which doesn't use the Google services anyway. It's likely going to be a boost for Huawei's rivals in the short term as the Chinese company scrambles to work out how to deal with this. Longer term it could mean a new - Chinese - rival to Android will now take shape. It's also worth looking at the context; the US and the China are embarking on an increasingly serious trade war; much will depend on how the Chinese government responds to this latest move.