Huawei's new flagship, the Mate 30 Pro, is still lined up for a September launch, but it'll be shipping without Google apps despite a license allowing Google to supply technology to Huawei during the current US export ban.
Days after the US Department of Commerce granted US companies a further 90-day reprieve for the ban on supplying technology to Huawei, Google has confirmed to Reuters that its license actually prevents it providing services to Huawei for its new products.
That stipulation means the upcoming Mate 30 can't be sold with licensed Google apps and services because the temporary reprieve doesn't apply to new products, according to Google.
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This would be a major roadblock for Huawei, which last week said the company plans to keep shipping its smartphones with Android rather than using its backup OS called Harmony.
It's also a headache for Google, which has said it wants to continue supplying services and apps to Huawei.
Huawei was added to the US Department of Commerce's Entity List in May after the US accused the Chinese company of violating trade sanctions against Iran. Granting the new extension, the department said Huawei was engaged in activities that are "contrary to US national security or foreign policy interests".
Despite the official line, US president Donald Trump has said the ban on Huawei could be lifted if China agrees to a new trade deal that's acceptable to the US.
The trade war with China is also causing concerns for Apple, which is exposed to a now-delayed round of tariffs targeting $300bn of Chinese imports, covering cellphones, laptops, video-game consoles, certain toys, and computer monitors. The new 10% tariff on imports from China is set to come into effect on December 15 and could negatively impact iPhone and Mac sales.
According to Trump, Apple CEO Tim Cook recently made a compelling argument that the tariffs harm it and help its main rival, Samsung, which manufacturers its smartphones in South Korea.
A Huawei spokesperson told Reuters the company "will continue to use the Android OS and ecosystem if the US government allows us to do so" and if not, it plans to continue developing its own Harmony operating system.
However, without an ecosystem of Android apps and Google's core apps, like Google Maps, Huawei is likely to struggle to sell its handsets, which are now the second most widely sold smartphones in the world, behind Samsung.
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Uncertainty over Huawei's future without Google apps and Android is already affecting its device sales, with carriers in Western Europe turning to Samsung's mid-range devices.
Huawei saw a 16% year-over-year decline in sales in the region in the second quarter, while greater carrier support helped Samsung increase shipments by 40%.