Huawei: how the arrest of the executive of Chinese society can hit Apple thoroughly | Technology

"The ban on Chinese companies such as Huawei will isolate the United States from the digital economy of the future," says the title.

• Huawei: why the Chinese giant has become the target of several countries

It is this threat of isolation that can leave American technology companies on alert. Meng was incarcerated for 12 days in Canada. The CFO was arrested at the request of the United States for violating economic sanctions imposed by the US government on Iran – which it denies.

This detention should at least cause more market difficulties for the American giants of technology, who have been able to establish themselves in the important Chinese market.

Last year, for example, about 20% of Apple's revenue came from China. "Some Western countries are using political means to resist Huawei's attempts to penetrate their markets," an article in The Global Time said.

"In the absence of a reciprocal openness, companies will not derive any benefit from the Chinese digital economy," the Chinese newspaper said.

China has been complaining for some time now that United States are unfair to their leading technology companies, especially Huawei, which is China's closest competitor compared to Apple's main competitor.

Although the annual profitability of the US company is still not close (Apple's profit is 266 billion USD against the 100 billion USD of Huawei), the Chinese company has outperformed global sales of smartphones more early this year. Huawei was only behind Samsung in this regard.

Tuesday, a Chinese court banned the sale of old models of the iPhone following a lawsuit for patent infringement between the US Apple and Qualcomm. The company claims that Apple has used in some models of iPhone a chip manufactured with technology patented by Qualcomm, without proper recognition.

This technology involves redefining the size of photos taken with the smartphone and the ability to use a touch screen for the use of applications. The two companies are fighting for similar actions of Qualcomm in several countries.

Most experts felt that China would reject Qualcomm's request. Therefore, the banishment of iPhone models surprised. Apple has appealed, which ensures that the company will be able to keep the handsets on sale in China until the judge's final decision.

There is no direct link between this measure and the controversy surrounding Huawei. But the fact that it was adopted after the arrest of Meng and amid the trade war import tariffs makes it a sign of strength on the part of the Chinese.

Huawei's real success, however, does not come from smartphones, but devices that make sense to have a technology phone. Huawei is positioning itself as a provider of 5G technology, the next generation mobile phone network.

In summary, if China believes that the United States unfairly harms the possibility for Huawei to be one of the protagonists of 5G technology, it can retaliate against Apple. And the American giant could feel the effects of this aggression.

"The last thing tech investors did not want to see, is this news about Huawei's CFO," said Dan Ives of investment advisor Wedbush.

"It's fuel for retaliation."

Huawei Product Protection

Wedbush Consulting estimates that 350 million iPhones arrive at a time when most users are looking for an upgrade. About 70 million of this total is in China.

"This means that a quarter of the additional growth over the next three to four years will come from China."

Even without official intervention, the advertising given to Huawei's case and the blocking of iPhone models could affect Apple's revenues from China.

Outside the Vancouver courthouse where Huawei's chief financial officer was heard on Monday (10), members of the Chinese community in Canada clearly expressed their feelings. They carried placards saying "Free yourself, Meng!" and told reporters that the United States was intimidating Huawei and, by extension, China.

Memoranda obtained by Yahoo News revealed that several Chinese companies had taken steps to promote to their employees the use of Huawei products instead of Apple articles.

"The news of the arrest of Huawei's chief financial officer, Meng Wanzhou, by Canadian authorities shocked the Chinese people," said a memo to the staff of the refrigeration technology company Jiangxi Ruike. The document encourages employees to exchange their IPhones for Huawei mobile phones in exchange for benefits offered by the company.

But Apple's success in China can help contain the fury of the Chinese government, even though Meng is extradited to the United States and placed in jail.

Of course, Apple sells not only its equipment in China, but also produces it in China. In 2017, Apple estimates that between production, retail and distribution, it has generated 4.8 million jobs in the Asian country.

In addition, the US company has opened research centers that employ some of China's brightest new graduates.

"They have a relationship with the Chinese government because they've been a big employer," Ives says, hinting that this could limit Beijing's leeway.

"Burning Apple, China would burn to some extent its own home."

Apple did not respond to requests from the BBC report.