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Trump’s Huawei ban also causing tech shocks in Europe

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The escalating U.S.-China trade war that’s seen Chinese tech giant Huawei slapped on a U.S. trade blacklist is causing ripples of shock across Europe too, as restrictions imposed on U.S. companies hit regional suppliers concerned they could face U.S. restrictions if they don’t ditch Huawei.

Reuters reports shares fell sharply today in three European chipmakers — Infineon Technologies, AMS and STMicroelectronics — after reports suggested some already had, or were about to, halt shipments to Huawei following the executive order barring U.S. firms from trading with the Chinese tech giant.

The interconnectedness of high-tech supply chains coupled with U.S. dominance of the sector and Huawei’s strong regional position as a supplier of cellular, IT and network kit in Europe suddenly makes political risk a fast-accelerating threat for EU technology companies, large and small.

On the small side is French startup Qwant, which competes with Google by offering a pro-privacy search engine. In recent months it has been hoping to leverage a European antitrust decision against Google  Android last year to get smartphones to market in Europe that preload its search engine, not Google’s.

Huawei was its intended first major partner for such devices. Though, prior to recent trade war developments, it was already facing difficulties related to price incentives Google included in reworked EU Android licensing terms.

Still, the U.S.-China trade war threatens to throw a far more existential spanner in European Commission efforts to reset the competitive planning field for smartphone services — certainly if Google’s response to Huawei’s blacklisting is to torch its supply of almost all Android-related services, per Reuters.

A key aim of the EU antitrust decision was intended to support the unbundling of popular Google services from Android so that device makers can try selling combinations that aren’t entirely Google-flavored — while still being able to offer enough “Google” to excite consumers (such as preloading the Play Store but with a different search and browser bundle instead of the usual Google + Chrome combo).

Yet if Google intends to limit Huawei’s access to such key services, there’s little chance of that.

(In a statement responding to the Reuters report Google suggested it’s still deciding how to proceed, with a spokesperson writing: “We are complying with the order and reviewing the implications. For users of our services, Google Play and the security protections from Google Play Protect will continue to function on existing Huawei devices.”)

Going on Google’s initial response, Qwant co-founder and CEO Eric Léandri told us he thinks Google has overreacted — even as he dubbed the U.S.-China trade war “world war III — economical war but it’s a world war for sure.”

“I really need to see exactly what President Trump has said about Huawei and how to work with them. Because I think maybe Google has overreacted. Because I haven’t [interpreted it] that way so I’m very surprised,” he told TechCrunch.

“If Huawei can be [blacklisted] what about the others?,” he added. “Because I would say 60% of the cell phone sales in Europe today are coming from China. Huawei or ZTE, OnePlus and the others — they are all under the same kind of risk.

“Even some of our European brands who are very small like Nokia… all of them are made in China, usually with partnership with these big cell phone manufacturers. So that means several things but one thing that I’m sure is we should not rely on one OS. It would be difficult to explain how the Play Store is not as important as the search in Android.”

Léandri also questioned whether Google’s response to the blacklisting will include instructing Huawei not to even use its search engine — a move that could impact its share of the smartphone search market.

“At the end of the day there is just one thing I can say because I’m just a search engine and a European one — I haven’t seen Google asking to not be by default in Huawei as search engine. If they can be in the Huawei by default as a search engine so I presume that everyone else can be there.”

Léandri said Qwant will be watching to see what Huawei’s next steps will be — such as whether it will decide to try offering devices with its own store baked in in Europe.

And indeed how China will react.

“We have to understand the result politically, globally, the European consequences. The European attitude. It’s not only American and China — the rest of the world exists,” he said.

“I have plan b, plan c, plan d, plan f. To be clear we are a startup — so we can have tonnes of plans, The only thing is right now is it’s too enormous.

“I know that they are the two giants in the tech field… but the rest of the world have some words today and let’s see how the European Commission will react, my government will react and some of us will react because it’s not only a small commercial problem right now. It’s a real political power demonstration and it’s global so I will not be more — I am nobody in all this. I do my job and I do my job well and I will use the maximum opportunity that I can find on the market.”

We’ve reached out to the Commission to ask how it intends to respond to escalating risks for European tech firms as Trump’s trade war steps up. Update: A Commission spokesperson for the Digital Single Market reiterated its prior statements around Huawei and cybersecurity, recommending Member States evaluate risks and strengthen risk mitigation measures. “EU Member States have the right to decide whether to exclude companies from their markets for national security reasons, if they do not comply with the country’s standards and legal framework,” the spokesperson added.

Also today, Reuters reports that the German Economy Minister is examining the impact of U.S. sanctions against Huawei on local companies.

But while a startup like Qwant waits to see what the next few months will bring — and how the landscape of the smartphone market might radically reconfigure in the face of sharply spiking political risk, a different European startup is hoping to catch some uplift: Finland-based Jolla steers development of a made-in-Europe Android alternative, called Sailfish OS.

It’s a very tiny player in a Google-dominated smartphone world. Yet could be positioned to make gains amid U.S. and Chinese tech clashes — which in turn risk making major platform pieces feel a whole lot less stable.

A made-in-Europe non-Google-led OS might gain more ground among risk averse governments and enterprises — as a sensible hedge against Trump-fueled global uncertainty.

“Sailfish OS, as a non-American, open-source based, secure mobile OS platform, is naturally an interesting option for different players — currently the interest is stronger among corporate and governmental customers and partners, as our product offering is clearly focused on this segment,” says Jolla co-founder and CEO Sami Pienimäki .

“Overall, there definitely has been increased interest towards Sailfish OS as a mobile OS platform in different parts of the world, partly triggered by the on-going political activity in many locations. We have also had clearly more discussions with e.g. Chinese device manufacturers, and Jolla has also recently started new corporate and governmental customer projects in Europe.”

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Crypto-driven GPU crash makes Nvidia miss Q2 projections by $1.4 billion

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Nvidia doesn’t officially announce its second-quarter financial results until the end of the month, but the company is trying to soften the blow by announcing preliminary results today. And as with so many other tech companies in the last month, the results are mixed at best. With $6.7 billion in revenue, Nvidia managed to eke out year-over-year growth, but the results are still bad news because that number is down from a previously forecasted $8.1 billion, a miss of $1.4 billion.

Nvidia blamed this shortfall on weaker-than-expected demand for its gaming products, including its GeForce graphics processors. Nvidia pointed to “a reduction in channel partner sales,” meaning that partners like Evga, MSI, Asus, Zotac, Gigabyte, and others were selling fewer new GPUs than anticipated. This drop can be attributed partly to a crash in the value of mining-based cryptocurrencies like Bitcoin and Ethereum—fewer miners are buying these cards, and miners looking to unload their GPUs on the secondhand market are also giving gamers a cheaper source for graphics cards.

“As we expect the macroeconomic conditions affecting sell-through to continue, we took actions with our Gaming partners to adjust channel prices and inventory,” said Nvidia CEO Jensen Huang. That means we may see further price drops for existing GeForce GPUs, which have already been dropping in price throughout the year. Some cards still haven’t reverted to their originally advertised prices, but they’re getting closer all the time.

By contrast, AMD grew its quarterly gaming revenue from $1.3 billion last year to $1.7 billion this year, thanks partly to its semi-custom hardware powering consoles like the Xbox Series S and X and the PlayStation 5. Nvidia’s GPU tech powers the Nintendo Switch, but otherwise, Nvidia is more dependent on PC gaming for its revenue.

In better news for Nvidia, the small overall increase in revenue is driven almost exclusively by the company’s data center business, including GPU-accelerated AI and machine learning applications and GPU acceleration for cloud-hosted virtual machines. Nvidia’s data center revenue is projected to be up 61 percent from last year, from $2.37 billion to $3.81 billion.

Nvidia will supposedly launch its next-generation RTX 4000 series GPUs later this year. Based on the new Lovelace architecture, these GPUs may appeal to some gamers who originally sat out the RTX 3000 series due to shortages and inflated prices and are now avoiding the GPUs because they know a replacement is around the corner.

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Cyberattack on Albanian government suggests new Iranian aggression

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Enlarge / Tirane, Albania.

Pawel Toczynski | Getty Images

In mid-July, a cyberattack on the Albanian government knocked out state websites and public services for hours. With Russia’s war raging in Ukraine, the Kremlin might seem like the likeliest suspect. But research published on Thursday by the threat intelligence firm Mandiant attributes the attack to Iran. And while Tehran’s espionage operations and digital meddling have shown up all over the world, Mandiant researchers say that a disruptive attack from Iran on a NATO member is a noteworthy escalation.

The digital attacks targeting Albania on July 17 came ahead of the “World Summit of Free Iran,” a conference scheduled to convene in the town of Manëz in western Albania on July 23 and 24. The summit was affiliated with the Iranian opposition group Mujahadeen-e-Khalq, or the People’s Mojahedin Organization of Iran (often abbreviated MEK, PMOI, or MKO). The conference was postponed the day before it was set to begin because of reported, unspecified “terrorist” threats.

Mandiant researchers say that attackers deployed ransomware from the Roadsweep family and may have also utilized a previously unknown backdoor, dubbed Chimneysweep, as well as a new strain of the Zeroclear wiper. Past use of similar malware, the timing of the attacks, other clues from the Roadsweep ransomware note, and activity from actors claiming responsibility for the attacks on Telegram all point to Iran, Mandiant says.

“This is an aggressive escalatory step that we have to recognize,” says John Hultquist, Mandiant’s vice president of intelligence. “Iranian espionage happens all the time all over the world. The difference here is this isn’t espionage. These are disruptive attacks, which affect the lives of everyday Albanians who live within the NATO alliance. And it was essentially a coercive attack to force the hand of the government.”

Iran has conducted aggressive hacking campaigns in the Middle East and particularly in Israel, and its state-backed hackers have penetrated and probed manufacturing, supply, and critical infrastructure organizations. In November 2021, the US and Australian governments warned that Iranian hackers were actively working to gain access to an array of networks related to transportation, health care, and public health entities, among others. “These Iranian government-sponsored APT actors can leverage this access for follow-on operations, such as data exfiltration or encryption, ransomware, and extortion,” the Department of Homeland Security’s Cybersecurity and Infrastructure Security Agency wrote at the time.

Tehran has limited how far its attacks have gone, though, largely keeping to data exfiltration and reconnaissance on the global stage. The country has, however, participated in influence operations, disinformation campaigns, and efforts to meddle in foreign elections, including targeting the US.

“We’ve become used to seeing Iran being aggressive in the Middle East where that activity just has never stopped, but outside of the Middle East they’ve been far more restrained,” Hultquist says. “I’m concerned that they may be more willing to leverage their capability outside of the region. And they clearly have no qualms about targeting NATO states, which suggests to me that whatever deterrents we believe exist between us and them may not exist at all.”

With Iran claiming that it now has the ability to produce nuclear warheads, and representatives from the country meeting with US officials in Vienna about a possible revival of the 2015 nuclear deal between the countries, any signal about Iran’s possible intentions and risk tolerance when it comes to dealing with NATO are significant.

This story originally appeared on wired.com.

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“Huge flaw” threatens US emergency alert system, DHS researcher warns

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Enlarge / Obstruction light with bokeh city background

The US Department of Homeland Security is warning of vulnerabilities in the nation’s emergency broadcast network that makes it possible for hackers to issue bogus warnings over radio and TV stations.

“We recently became aware of certain vulnerabilities in EAS encoder/decoder devices that, if not updated to most recent software versions, could allow an actor to issue EAS alerts over the host infrastructure (TV, radio, cable network),” the DHS’s Federal Emergency Management Agency (FEMA) warned. “This exploit was successfully demonstrated by Ken Pyle, a security researcher at CYBIR.com, and may be presented as a proof of concept at the upcoming DEFCON 2022 conference in Las Vegas, August 11-14.”

Pyle told reporters at CNN and Bleeping Computer that the vulnerabilities reside in the Monroe Electronics R189 One-Net DASDEC EAS, an Emergency Alert System encoder and decoder. TV and radio stations use the equipment to transmit emergency alerts. The researcher told Bleeping Computer that “multiple vulnerabilities and issues (confirmed by other researchers) haven’t been patched for several years and snowballed into a huge flaw.”

“When asked what can be done after successful exploitation, Pyle said: ‘I can easily obtain access to the credentials, certs, devices, exploit the web server, send fake alerts via crafts message, have them valid / pre-empting signals at will. I can also lock legitimate users out when I do, neutralizing or disabling a response,’” Bleeping Computer added.

This isn’t the first time federal officials have warned of vulnerabilities in the emergency alert system.

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