It's not a great idea to completely rely on anyone. And China's Huawei has learned a hard lesson.

As a major contributor to 5G technology, the Shenzhen-based company can no longer produce a 5G-enabled smartphone – "a shame" in the words of Eric Yu, head of Huawei's consumer products.

A lot of people may think that Huawei got punished for infuriating the U.S. and all other companies will be fine if they don't try to compete with Apple and Samsung.

But that's not correct.

Huawei got punished for relying on TSMC to mass produce its flagship chip – the Kirin series, one of the first smartphone chips to reach a process of five nanometers.

Yu has openly admitted that Huawei should have built its own chip foundry to secure the supply chain.

Huawei is not the only company with a chip headache. Apple is also suffering from users complaining that iPhones have weak signals.

A key reason for this problem is that the modem chip enabling 4G and 5G on iPhones is made solely by another U.S. company, Qualcomm.

Qualcomm is less well-known than Apple, but it's not a nobody. You may have seen many ads talking about the company's Snapdragon chip, which powers most flagship Android phones.

Apple relied on Qualcomm chips to get signal bars on iPhones for many years and tried hard to change the situation.

First, they cooperated with Intel, another well-known U.S. chip giant that builds the core chip for computers and servers, to create a new modem chip.

Apple showed great sincerity by using the Intel modem exclusively in iPhones. If you are holding an iPhone XS or 11, you are on the Intel side, which is not good news because the Qualcomm chip performed better in a wide range of tests posted online.

After losing to Qualcomm in the modem game, Intel became less and less interested in making modem chips and eventually sold the entire engineering team to Apple for a billion dollars.

When Qualcomm realized Apple failed to build a good modem chip and had to use Qualcomm products instead, the semiconductor company decided to keep charging a high price for the chips. The cost was so high that Apple decided to sue Qualcomm. And the suit was settled in 2019 in favor of Qualcomm.

The punishment was harsh. Apple was reported to have paid billions to Qualcomm to settle the case and reached a license agreement with Qualcomm for at least six years to 2025, which could mean more payments in the future.

After all, new iPhones and iPads are still using Qualcomm modems. And Apple is still having a hard time building their own 5G modem.

That's how relying on one company in your own country can hurt you. Imagine if you are relying on foreigners.

Therefore, more and more companies and researchers started paying attention to another way out of chip reliance: open chip design like RISC-V, with which you can see how the chip is designed from scratch without paying any money. The sacrifice is that you must help populate the design.

It's a bit like open-source software, which used to be treated as a joke by Microsoft founder Bill Gates but now powers the internet. A lot of people even called the movement "open-source hardware."

Open-source software is such a success that most of the internet services we use today run on it. The Android system that powers most smartphones is also based on open-source Linux.

It's still hard to tell if the movement will succeed. If the hardware world resembles its software counterpart, the movement will likely spread like wildfire.

But there is still a chance that the hardware world will prove more challenging and the open path leads nowhere.

All in all, it's safe to say that the hardware world is getting close to a crossroads, and we may have to decide between open standards and monopolies for our computers and phones in the near future.