USA and China have now been rivals for decades. But for the last couple of years, the situation has gotten a bit tense culminating into a trade war of sorts. The reason- a lot of the consumer electronics sold in the US come from China’s factories, despite the fact that the parent companies are mostly headquartered in the US.

This is one of the major reasons behind the termination of the partnership between US chip giant Intel and Chinese mobile chip maker Unisoc, a core subsidiary of state-linked Tsinghua Unigroup, according to reports from Nikkei Asian Review.

The ending of the partnership comes at a time when China aims for self-sufficiency in strategic technologies. Moreover they want to close the economic gap between themselves and USA.

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Intel has been concerned that the closer ties with the Chinese government-sponsored company could somehow upset US authorities given the current tensions between the two sides.

The tie-up came through in MWC 2018.

The tie-up was first announced at the 2018 Mobile World Congress, where Intel called it a “multiyear” venture. This venture would give Intel access to the massive China chip market where Intel is outpaced by Qualcomm and MediaTek. The two companies planned at that time to jointly deliver a 5G smartphone solution leveraging Intel’s modem expertise that would roll out to the market in 2019. Intel was supposed to share its latest XMM 8000 series of 5G commercial multi-mode modems with Unisoc.

Source: Intel

The split comes as China-US tensions shift from trade imbalances to technology-related security risks. The most prominent example being the U.S. cracking down on Chinese tech companies(like Huawei and Fujian Jinhua) with allegations of IP theft and economic espionage charges. Other example being the spat between Qualcomm and Apple.

According to trade analysts, this split is not going to harm Intel as it has enough options to enter China’s market, but it will be a huge loss for Unisoc as it is losing the opportunity to collaborate with a prominent player from the Silicon Valley.

Further reading:

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Intel’s 10nm Hybrid Lakefield SoC Coming Later this Year; 12mm Die

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