Huawei has one 5G power that is hard for the US to hurt

As the US tries to thwart Chinese chipmakers through more punitive sanctions, and by sealing the loopholes that exist in older trade rules, China has retaliated. On December 4, its government reportedly moved to ban exports to the US of raw materials critical to certain types of semiconductors. Among them is a substance called gallium. Combining it with nitrogen produces a compound known as gallium nitride. Without it, the radios used in today's 5G networks would not be nearly so good.

Unfortunately, most gallium is found in China, as the Biden administration recognized in a lengthy report about supply chain risks published several years ago. "The raw materials used to produce wafers – including silicon and gallium – are concentrated in China," wrote the authors. The point was emphasized later when they noted that "China is the leading global supplier for gallium, one of the base elements for gallium nitride and gallium arsenide semiconductors."

Among other things, gallium nitride confers advantages compared with silicon as a raw material for the radiofrequency (RF) power amplifiers used in 5G products. Investment in it partly explains why Huawei, China's biggest maker of 5G equipment, has been able to produce such lightweight and energy-efficient 5G radios compared with key rivals based outside China, according to experts.

US sanctions have clearly blocked Huawei's access to Taiwan's TSMC, the world's most advanced chip foundry, and stopped the Chinese company from obtaining 5-nanometer and even smaller chips for inclusion in smartphones and 5G basestation products. But hurting Huawei in power amplifiers looks much harder, and not because such an important raw material lies mainly outside US jurisdiction.

Three body problem

Gallium nitride is made through a process called metalorganic chemical vapor deposition (MOCVD), and the tools for it are widely available in China, according to Earl Lum, the founder of EJL Wireless Research. "The MOCVD machines that are used to make the gallium nitride epitaxial material are the same machines that were used to make blue and green LEDs," he told Light Reading. "There are thousands of these machines in China that were shipped to make green LEDs and that can be converted to make RF."

In the US, moreover, hardly anyone appears to have enjoyed success in developing highly capable gallium nitride-based RF power amplifiers. "There's no one in the US that has been able to make an amplifier other than NXP," said Lum. "Qorvo tried it but didn't get too far. Skyworks never got that far. Macom and some others have tried. No one's actually succeeded."

Huawei previously sourced gallium nitride-based RF power amplifiers from Sumitomo Electric in Japan. But in late 2019, as the US began its clampdown, Huawei reportedly began shifting production of smartphone power amplifiers designed by its HiSilicon subsidiary to a Chinese fab called Xiamen Sanan, which today advertises its use of gallium nitride and role in epitaxial growth on its website. In the absence of much visible US progress, the market for gallium nitride-based RF power amplifiers used in 5G networks is now a three-player race between NXP, Sumitomo and "whoever Huawei is using over in China through a foundry," according to Lum.

Meanwhile, Ericsson and Nokia have continued to lag Huawei on the introduction of gallium nitride into 5G products, reckons the analyst. Partly to blame, he says, was the wait for NXP to open a gallium nitride fab in Arizona, which finally happened in late 2020. "The western guys were late partly because NXP was late in their gallium arsenide, gallium nitride foundry and fab in Arizona," said Lum. "So everyone had to wait for that to actually happen because they were using a lot of NXP chips."

Lighter is better

Relying on an older silicon-based alternative called LDMOS (for laterally diffused metal oxide semiconductor) would often result in less efficient power amplifiers and heavier 5G radios, say experts. And despite the US sanctions that affect other parts of Huawei's business, the company's most advanced 5G radio units have continued to weigh less than the products sold by Ericsson and Nokia, according to a telco source.

The weight and energy efficiency of radios are critical factors for telcos investing in 5G networks. Heavier equipment, cooled by convection or fans, naturally puts more strain on masts, which may need reinforcing to support it. Additional workers may also be required for its installation, further driving up costs. And energy consumption by radios is a significant operational expense for network operators.

Unsurprisingly, then, Huawei's rivals have been shifting from LDMOS to gallium nitride for products engineered to work in 5G's higher spectrum bands. "Samsung uses gallium nitride in its RF power amplifiers as it is widely considered an optimal choice to accommodate 5G's high frequency requirements," said a spokesperson for the South Korean vendor by email when asked about Samsung's gallium nitride investments. As far back as 2020, Ericsson had highlighted its efforts to take advantage of gallium nitride in 5G.

A Chinese ban on gallium exports, if properly enforced, could potentially be very damaging to the strategies of the western vendors. At the very least, it would increase raw material costs. But for US authorities, restricting Huawei may also prove more difficult in this area than it has been across other parts of the chip industry. While the US has conceivably been able to cut China off from Sumitomo, it can do little to stop any Chinese foundry that serves Huawei other than blocking future sales to it of US-made foundry equipment.

Huawei was still claiming superiority in 5G power amplifiers at the start of this year. "For this component, we are leading the industry one generation ahead of our competitors, and that is why, according to third parties who report, we keep leading market share," said Philip Song, the chief marketing officer for Huawei's carrier networks, at this year's Mobile World Congress. After several years of sanctions, that will sound galling to US hawks.