U.S. Sanctions Threaten Xiaomi’s High-End Chip Development

Xiaomi has just introduced his first of its own flagship sit for smartphones and tablets, but the Chinese electronics manufacturer could soon no longer be allowed to work legally on new high-end chips due to new US sanctions.

Xiaomi as one of the first providers affected by new embargo

According to a report of the Financial Times Is one of the first manufacturers directly affected by a new requirement of the US Department of Commerce, which prohibits the manufacturers of so -called Electronic Design Automation (EDA) based in the USA to sell their technology to Chinese customers.

So far there are hardly any details on the new requirements, but according to the report, it is likely that Xiaomi and other Chinese companies, such as Lenovo and the crypto company Bitmain, will no longer receive updates for their design tools from US manufacturers. Current licenses are likely to be used, but the path would be blocked for future updates, it is said.

‘Piracy’ as a quick solution?

The US companies that Chinese customers have so far been allowed to continue supplying EDA software, despite existing embargo, have been supplied with Synopsys and Cadence. With the new restrictions announced in May, the US government wants to prevent China from being able to further expand its skills around modern chips. Because the production of the Chinese chips that have been developed with the US software to date is largely carried out in the Taiwanese contractual TSMC, one could also reach limits here.

Since TSMC is constantly further developing its manufacturing technologies, the designs from China could no longer be produced with the most modern production standards in the future, the report continued. However, a “solution” is emerging for the Chinese chip manufacturers. More and more Chinese chip developers simply seem to use illegal copies of the latest versions of EDA solutions from US manufacturers such as Cadence or Synopsys. It is easy to bypass the update locks of the software suppliers in order to get to the latest versions of the EDA software, the report continued.