Huawei Technologies unveils new software to overcome Trump blacklist

Huawei Technologies unveiled long-awaited details of its HarmonyOS software, the operating system intended to take a central role in a consumer electronics market dominated by Google’s Android and Apple’s iOS.

HarmonyOS has been designed to work across smartphones, appliances and other hardware, combining the capabilities of all connected gadgets for what Huawei calls “super device” utility. The company demonstrated multi-device functionality as part of its HarmonyOS showcase and said it plans to build its new platform into a hub that connects a wide spectrum of hardware from earbuds to smart cars.

Huawei introduced a number of smartphones, smartwatches and tablets running the 2.0 version of the HarmonyOS at an online event on Wednesday, June 2. The company said nearly 100 of its own devices will be able to upgrade to the latest system in China.

The Shenzhen-based telecom gear maker is looking to the Internet of Things (IoT) as a path to competing with Apple and Alphabet’s Google. Development of HarmonyOS dates back to 2016, but was accelerated after Washington blacklisted Huawei, cutting it off from essential mobile chipsets and key Google services. With Android and iOS already entrenched in their dominance over the smartphone landscape, Huawei’s aim is to be best at linking interconnected electronic devices and accessories.

“Like other industries, the mobile internet industry built on top of smartphones is set to saturate,” said Wang Chenglu, president of software at Huawei’s consumer business group. “The day when Huawei started to develop Harmony, we decided it will not be another Android or iOS because that wouldn’t bring value to our customers and app developers.”

Huawei introduced a number of gadgets running the in-house HarmonyOS, promising the operating system will allow the devices to share data and even computing power so users can receive consistent service — across both Huawei and third-party devices.

“Huawei’s announcements reflect its need to pivot away from a reliance on smartphones to other hardware categories,” said Ben Wood, chief analyst at CCS Insight. “Many of these devices are able to use WiFi rather than a cellular connection, making it easier to get around the sanctions related to 5G chips.”

The company reported a 17% decline in sales in the first three months of this year, the second straight quarterly drop after years of prodigious growth fuelled by its smartphone division. After sanctions hit, the company was forced to seek new cash cows from an array of emerging businesses including smart mining, renewable energy and electric vehicles.

The Harmony project is Huawei’s big bet in the consumer market. Worldwide demand for smart home devices, such as smart speakers, video entertainment products and smart locks, is expected to balloon in the coming years with China becoming the largest market before 2025, according to research firm IDC. Consumer enthusiasm for wearables is also gaining momentum, a separate IDC report showed.

User adoption in the early years will be a key gauge for the potential of HarmonyOS, as app developers and hardware vendors are typically reluctant to invest in an unproven new platform. Samsung Electronics’s Tizen and Microsoft’s mobile OS efforts have both petered out as rivals to the big two after failing to get traction.

But Huawei’s IoT ambition is set to face fierce competition at home in China, where Apple enjoys a loyal user base at the premium tier even with many of its add-on services unavailable. Local vendor Xiaomi is also rapidly expanding its own IoT ecosystem with deeply-tailored Android offerings.

Wang expects HarmonyOS to power around 200 million Huawei smartphones in China before 2022. Another 100 million devices, such as projectors and smart speakers made by third-party vendors, will also install the new OS by the end of this year.

“That should give us a solid foundation to start from,” Wang said, adding that the development and operation cost for HarmonyOS app creators will be a fraction of the cost of traditional mobile platforms. — Bloomberg