SK Hynix Isn't Sure How Its Chips Got in Huawei's New Phone

[fitpOsitive]

the problem is the commonality of these chip, every, I mean, EVERY phone runs on these chip, which mean you could have bought a lot in small batches from different outlet and nobody would be wiser before your game is up. It's like drug dealer buying pre-cursor chemical and make drug, if you buy one big batch, people are all going to look at how you use it or where it ends up, but if you put it in small interval, buying maybe 1000 more (just an arbitrary number denoting small amount) on top of the normal order, nobody are going to bat an eyelash over

I don't know how much you know about the chip business, but even if 10 different users buy exact same chip, their production testing will be very different. It's not only the chips the supplier provides, it's the complete, distinctive set of requirements the supplier fulfills. With characterization or production testing, we know who is the user. I mean it's like writing names on birthday cakes. It's the complete chip set, not general-purpose off-the-shelf AND-gate IC.

 

[jhungary]

I don't know how much you know about the chip business, but even if 10 different users buy exact same chip, their production testing will be very different. It's not only the chips the supplier provides, it's the complete, distinctive set of requirements the supplier fulfills. With characterization or production testing, we know who is the user. I mean it's like writing names on birthday cakes. It's the complete chip set, not general-purpose off-the-shelf AND-gate IC.

Well, it really depends on how deep and how nefarious you want to go. What if Huawei partner up with multiple companies to defraud the SK Hynix.

The problem is, yes, you need a complete requirement to go into production, but can you tell which is which? I mean I don't suppose they told SK Hynix that they are building the Huawei Mate 60 pro, what they will give to SK Hynix instead is a specification and requirement that they need them, again, it could be from different source or thru different company or even done via existing customer of SK Hynix. They wouldn't know it's Huawei until very late in the game.

While I don't have much experience with chip business, but I do have experience with Corporate Espionage with tech company doing exactly the same thing, you can fool people with dimensions and requirements, and again, these chipset is very, extremely common, you would be able to fool SK Hynix for a while before they found out, the issue here I have is, SK Hynix seems like they have no idea Huawei is using their chips, that's what bother me, because that mean either they know and they are not telling you, or they really don't know and there will be a bigger problem.

Or you can believe it's SK Hynix who directly sell these chips despite US Sanction, which I just don't find it probable. Because unless they think the US will never know, it's very obvious and easy to track this infringement down.

 

[fitpOsitive]

because that mean either they know and they are not telling you,

Exactly!

 

[jhungary]

Exactly!

Again, it's very improbable.....unless they think US is not going to know. Reality is, they will know after once the first person who do these take down video took down a phone. And you know they are going to do it

 

[jhungary]

There are two scenarios:

1. They have solved all the technical problems, but they don't want to waste the chips they bought before being punished. So Huawei integrates spare chips into their phones. After using up all inventory, Huawei's other products will use self-developed indigenous chips

They wouldn't anchor their Flagship phones on these left over. they may use them on lower tier phone because if they have left over, that's not going to be a lot, unless you want to go with 2 different version of the phone because the tech is going to be different.

2. They haven't solved all the technical problems yet but it's just a matter of time. They can make enough profit with Huawei P60 and buy time, waiting until the native chip successfully develops itself, replacing imported products, which could be a few months or a year.

It's unlikely they are that close to breakthrough like that , if they are they probably will wait until the Chinese chip are available if they are that close. I mean Mate 60 Pro waited for 2 years, what's a few month delay is going to make a different of?

 

[Hamartia Antidote]

If you start a potato chip business, wouldn't you know who is the ultimate user?

No, do you think Pringles knows how many chips I bought? Pringles doesn't deal with customers directly. They sell to a wholesaler, who then sells to retailers, and then to me.

Same maybe with some microchip sales.

For non-custom chips they probably don't deal with customers directly. They just take an order quantity from a distributor who then resells them.

 

[jhungary]

No, do you think Pringles knows how many chips I bought? Pringles sells to a wholesaler, who then sells to a retailer, and then to me.

Same maybe with some microchip sales.

For non-custom chips they probably don't deal with customers directly. The just take an order from a distributor who then resells them.

There are many way to fool a company, they could have some proxy company drawn up a requirement and ask SK Hynix to supply them, LPDDR5 (not sure about the U310 NAND gate) are quite common in anything mobile like computer, mobile and tablet, they can just find some shell to start some bogus requirement and acquire those chip that way, it would take SK Hynix a few batch to know what's going on.

Or they can simply strip them from competition stock Russian style, I mean they can buy a whole bunch of device with these chip inside and strip them and use them themselves, not saying this is likely or smart, but it's doable.

 

[fitpOsitive]

There are many way to fool a company, they could have some proxy company drawn up a requirement and ask SK Hynix to supply them, LPDDR5 (not sure about the U310 NAND gate) are quite common in anything mobile like computer, mobile and tablet, they can just find some shell to start some bogus requirement and acquire those chip that way, it would take SK Hynix a few batch to know what's going on.

Or they can simply strip them from competition stock Russian style, I mean they can buy a whole bunch of device with these chip inside and strip them and use them themselves, not saying this is likely or smart, but it's doable.

Such chips are always shipped with encrypted software. So highly unlikely that way.

 

[jhungary]

Such chips are always shipped with encrypted software. So highly unlikely that way.

Again, you don't know where that is intended to go when you are fulfilling the order

Say I own a company, I need to have a proprietary design I need to fix a phone, and I send my order to SK Hynix, only I don't tell SK Hynix it's my company, but I do it via maybe one of those Hong Kong Holding and asking for them to provide the proprietary chip set, SK Hynix may inspect the plant for such a phone (Which I can set up as a front) and then they will fulfill the order if nothing is a miss. They wouldn't know it was for my phone because I won't tell anyone my proprietary design.

The thing is, SK Hynix only will know this is a fake when they eventually see nothing coming out of that HK Production Line front, and by then they probably would have ship them a few batches, and if they are doing it thru multiple sources, they will get enough to start an entire production line.

As I said, I have had experience dealing with this on behalf of a Tech Company, this has happened before, and I doubt it will not happen again.

 

[antonius123]

They wouldn't anchor their Flagship phones on these left over. they may use them on lower tier phone because if they have left over, that's not going to be a lot, unless you want to go with 2 different version of the phone because the tech is going to be different.

Using same spec with different brand will be no different tech at all.

 

[GreatHanWarrior]

Again, you don't know where that is intended to go when you are fulfilling the order

Say I own a company, I need to have a proprietary design I need to fix a phone, and I send my order to SK Hynix, only I don't tell SK Hynix it's my company, but I do it via maybe one of those Hong Kong Holding and asking for them to provide the proprietary chip set, SK Hynix may inspect the plant for such a phone (Which I can set up as a front) and then they will fulfill the order if nothing is a miss. They wouldn't know it was for my phone because I won't tell anyone my proprietary design.

The thing is, SK Hynix only will know this is a fake when they eventually see nothing coming out of that HK Production Line front, and by then they probably would have ship them a few batches, and if they are doing it thru multiple sources, they will get enough to start an entire production line.

As I said, I have had experience dealing with this on behalf of a Tech Company, this has happened before, and I doubt it will not happen again.

Huawei does not sell to Australia. Why are Australian babies so flustered??

Will Huawei affect Australian coal mining?

 

[letsrock]

No, do you think Pringles knows how many chips I bought? Pringles doesn't deal with customers directly. They sell to a wholesaler, who then sells to retailers, and then to me.

Same maybe with some microchip sales.

For non-custom chips they probably don't deal with customers directly. They just take an order quantity from a distributor who then resells them.

How are sanctions supposed to work then ? hynix ran foul of sanctions. now they must invest in surveillance and track each chip and its end use and prepare to report to senate committe.

 

[CIA Mole]

to be 100% chinese they must use chinese programming language

but then again pretty much all modern technology is western concepts anyway

 

[hirobo2]

What if Huawei deliberately used SK Hynix memory and SSD to troll the US (or as a decoy)? Now US must allocate additional resources to investigate... It's no longer how SMIC evaded sanctions but how SMIC + Hynix did so! Pretty smart move if you ask me, divide your enemy's attention into two...

 

[Dalit]

They are all guessing and speculating. China is in any case having the last laugh.