It’s an older story, but you might remember that ZTE was caught illegally selling parts and components from US companies to Iran. That skirted some sanctions, and needless to say, didn’t sit well with the US government. That’s resulted in some painful sanctions for ZTE.
The ban comes from the US Commerce Department and prevents US companies from selling any parts whatsoever to ZTE. That’s going to do some damage to ZTE, too, as an estimated 25% of their components are sourced from the United States, including parts for both smartphones and networking equipment.
What’s even worse for ZTE in this ban is that it looks like it would also include Google’s Play Store and Play Services, which would seriously damage ZTE’s ability to sell phones in any regions outside of China. Globally it’s nearly impossible to sell an Android smartphone without Google Play, although that doesn’t apply to China since so many OEMs opt for Chinese-specific app stores and services.
China obviously isn’t happy about this move, either, so don’t be surprised to see some pushback on other fronts from the Chinese government.