The U.S. Department of Commerce slapped ZTE, the fifth largest smartphone maker in the world, with a seven-year ban inside the United States. This ban meant that ZTE couldn’t buy or use any components in its devices made by U.S. companies. This was essentially a death sentence for the company.
A filling today by ZTE shows just how dire the situation is, as the company announced that they are ceasing “major operating activities” due to the effects of the U.S. ban. Currently, the company has enough cash to support all current contracts, giving ZTE some time to figure out what’s next.
The company noted that it is currently in talks with the U.S. Department of Commerce ” in order to facilitate the modification or reversal of the Denial Order by the U.S. government and forge a positive outcome in the development of matters.”
If ZTE does go under, it will leave a pretty large hole in the industry as the company is a major player in the budget phone market. It will also leave consumers with far less choices when it comes to affordable smartphone options.
Source: Reuters
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