Oppo has to cancel own chip production

While many companies are currently setting up their own chip series due to the exploding demand, a renowned tech brand is giving up. The Chinese smartphone manufacturer Oppo has pulled out of the race and unceremoniously shut down its chip division. The cause is likely to be the impact of the extensive US sanctions against China.

A giant is leaving the ring

Oppo has made a big name for itself worldwide as a smartphone manufacturer in recent years. The deep fall of Huawei is certainly partly to blame for this. After all, the former leader in Android device sales was followed by other Chinese companies. However, the now extensive US sanctions have obviously not only affected the large Chinese tech company noticeably. Other manufacturers like Oppo also have to draw consequences. Thus, the company has now had to close its chip division Zeku, as can be seen from a report from the South China Morning Post. The company makes clear in its corresponding statement that the decision was by no means easy. Rather, it says, it was pushed to do so because of the current global economic situation.

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Behind the out, of course, there are many human fates that should not be ignored. For example, Zeku employed nearly 3,000 employees. For these, the step is said to have been more than just surprising. After all, Oppo’s chip division was still trying to find new employees for a few weeks. Now the staff has been informed from one day to the next that the closure is coming. Some time ago, everything looked promising. Zeku was working on chip technology that was manufactured in the 6 nm process. One of the most famous models was the MariSilicon X. It enabled an amazingly good camera performance in the Oppo Find X5 Pro, for example.

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Oppo bet on the wrong horse

Oppo will not be the last of China’s tech giants to close its in-house chip division. The basic problem is that the company did not produce the chips it designed itself in its own factories. Instead, Zeku resorted to outside service providers a la TSMC. However, the far-reaching US sanctions now prohibit TSMC from working with Chinese companies when it comes to manufacturing chip technology of a size below 14 nm. Since not every Chinese company like Huawei can quickly set up its own chip production, it makes more economic sense to completely shut down production.