Is there a growing divide between Nokia and Huawei in their relationship?

Recently, Nokia found a buyer for a majority of its shares in a telecommunications joint venture with Huawei Technologies - TD Tech (headquartered in Beijing).

TD Tech, founded in 2005, was a joint venture between Huawei and German technology group Siemens until 2007, when Siemens sold half its shares to Nokia. In 2013, Siemens divested all shares, making Nokia a major shareholder.

According to a report by China's State Administration for Market Regulation (SAMR), wireless technology company TD Tech will be jointly controlled by Huawei and a group of other units including Thanh Hi-tech Investment Group. Do and Chengdu Gaoxin Jicui Technology Company (owned by the government), as well as venture capital firm Huagai.

The report does not disclose how much equity the new shareholders hold. Before the sale, Nokia owned 51% of TD Tech, while Huawei held 49%.

According to industry observers, although Nokia holds a larger stake in the joint venture, Huawei is in fact in control.

Huawei and TD Tech together control no more than 10% of China's smartphone market, according to SAMR.

Data from market research firm Counterpoint Research shows Huawei had a 14% share of the Chinese smartphone market in the third quarter of last year, coming in fifth place behind Honor and rivals OPPO, vivo and Apple.

Yang Quang, an analyst in charge of the telecommunications sector at research firm Omdia, said last year: “The leadership is made up of former Huawei employees, with product solutions based on Huawei products. but tailored for the industrial market.”

According to SCMP, last year, when Nokia tried to sell most of its shares to New East New Materials (Shanghai), Huawei threatened to stop licensing technology to TD Tech.

At the time, Yang said, Huawei may not want to lose control of TD Tech, which could help the Chinese tech giant avoid some US sanctions.

In 2021, TD Tech began selling Huawei phones under its own brand, including the M40 5G, which uses MediaTek's 7 nm chip instead of Huawei's own Kirin processor.

Sanctions imposed by Washington currently prohibit companies from selling to Huawei advanced chips made with US-origin technology, including MediaTek processors made by TSMC, a contract chipmaker the world's largest.

Despite US restrictions, Huawei last year launched the Mate 60 Pro, a phone equipped with an advanced domestic 5G processor.

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