Tech startups are among the many hundreds of innovators from various industries opposing a third proposed tranche of 25 percent levies on Chinese imports (see 1808150018), comments in docket USTR-2016-0026 show. Cao Gadgets develops wireless sensor tags for a variety of IoT uses and markets the tags through its own online store, commented owner Mike Cao. It develops the “software/firmware portion of our products” entirely in the U.S., and buys integrated circuits and other electronic components from American producers like Intel, Microchip and ON Semiconductor, he said. His company then exports its goods to printed circuit board assembly (PCBA) contractors in China, he said: PCBA is a “labor intensive process,” with virtually no low-cost, high-volume U.S. PCBA contractors. Jie Qi and Andrew Huang started Chibitronics, making educational electronics for schools and libraries, they commented Wednesday. Additional “tariffs on electronic parts will deprive American children of access to technology education,” they said.

Cree estimates the first tranche of 25 percent tariffs on Chinese imports that took effect July 6 will reduce earnings by about 2 cents a share in Q1 ending late September and by about 3 cents a share each future quarter, said outgoing (see personals section of the July 24 issue) Chief Financial Officer Mike McDevitt on a Tuesday earnings call. Cree argued unsuccessfully in the first round to defeat tariffs on LEDs it reimports from China and took an additional hit when the second tranche of tariffs to take effect Aug. 23 included other duties. Quarterly guidance doesn’t include “any potential impact of any tariffs” that take effect Aug. 23 or later, said McDevitt. Cree is “evaluating ways” to further reduce the damage, he said. It expects a 6 percent Q1 revenue decline sequentially. Tech interests continue opposing the levies (see 1808140047). The stock closed down 7.8 percent Wednesday at $46.26.

Micro Electronics and GlobiTech were among the tech interests joining many hundreds of companies asking to testify during four days of hearings beginning Aug. 20 against the proposed third tranche of tariffs on an estimated $200 billion worth of Chinese imports. Requests were due Monday in docket USTR-2018-0026 under the deadline U.S. Trade Representative Robert Lighthizer extended when he announced Aug. 1 he'll “consider,” at President Donald Trump’s direction, raising the third tranche of proposed duties to 25 percent from 10 percent (see 1808010073). Lighthizer in an Aug. 7 notice said he reserves the option to “extend the length of the hearing depending on the number of additional interested persons who request to appear.” Micro Electronics CEO Richard Mershad wants to testify for removing six Harmonized Tariff Schedule line items, said comments posted Tuesday. Computers and parts it identified aren't available in big quantities outside China, said the parent of an electronics retailer. GlobiTech wants to testify against tariffs on the raw materials it imports from China under HTS 3818.00.00 to manufacture silicon epitaxial wafers, said the company. Those wafers are a $3 billion “subset” serving the global semiconductor industry, it said. “As the world's largest supplier of silicon epitaxial products, chances are that smartphone that you are holding has ‘some GlobiTech in it.’"

Viewers in Europe’s five largest markets -- France, Germany, Italy, Spain and the U.K. -- watched on average two more hours a month of on-demand content in 2017 than the previous year, said IHS Markit Monday. Linear TV viewing time declined, as did time-shifted viewing on personal video recorders. “With the increasing volume of consumption moving away from traditional linear broadcast, monetization of on-demand and time-shifted viewing remains a key concern, as ad-insertion and tracking technology has been slow to keep up,” said IHS. The increasing shift to over-the-top consumption “signals the need for pay TV operators to act quickly,” it said. “Leading operators are already enhancing their current propositions and embracing OTT, to ensure they capture some of the time spent on other devices and services.”

Control4 can financially handle the Trump administration's planned tariffs on Chinese goods that concern some tech companies (see 1808030034), executives said Thursday. Friday, the stock closed up 20.6 percent to$31.67after reporting record revenue and net income in Q2. Chief Financial Officer Mark Novakovich said the company will absorb and offset the impact of planned tariffs and doesn’t plan to change product pricing this year, partly due to lower tax rates. “We will continue to ... explore all options available to reduce the impact.” The home automation company is exploring many sourcing options or scenarios, Novakovich said. He said it's too early to make a decision because of costs associated with changes, and too soon to make long-term commitments "until we know more about the duration of some of these tariffs and the specific product classes that they are going to definitively impact." CEO Martin Plaehn confirmed his company is working with Apple for control of Apple TV over IP for a product resulting from the bigger company releasing application program interfaces to enable third-party companies to control media streamers.

China urges the U.S. “to adopt a correct attitude" on trade relations between the two countries and not try to "blackmail China because it will not work,” said Foreign Ministry spokesman Geng Shuang at a Beijing news conference Thursday, reacting to the Trump administration’s announcement it will “consider” hiking the latest round of proposed Trade Act Section 301 tariffs on Chinese imports to 25 percent from 10 percent (see 1808010069). China also urges the U.S. “to return to rationality and refrain from acting impulsively, otherwise they will end up hurting themselves,” he said.

Three Ukrainian nationals linked to FIN7, a prolific cyber hacking group from Eastern Europe, were arrested and charged for their roles in allegedly attacking more than 100 U.S. companies, said DOJ Wednesday. Dmytro Fedorov, Fedir Hladyr and Andrii Kopakov are in custody facing charges filed in the U.S. District Court in Seattle. DOJ alleged since at least 2015 the group targeted more than 100 U.S. companies, mainly in the restaurant, gaming and hospitality industries. The perpetrators “hacked into thousands of computer systems and stole millions of customer credit and debit card numbers,” said DOJ.

European smart homes over the next five years will triple to 103 million, and annual smart device shipments will reach more than 154 million, ABI Research reported Tuesday. Signify (formerly Philips Lighting), Hive, tado and Netatmo will gain there, the researcher said. U.S. giants Amazon, Apple and Google will influence the market and its growth, said analyst Jonathan Collins. Attempts to replicate U.S. smart home strategies in Europe struggled, the analyst said, but products including from Deutsche Telekom and Swisscom are driving smart home management availability, and Vodafone and BT entered the smart home services market this year.

The U.S. trade relationship with China "significantly impacts” CTA members relying "on the global supply chain,” said Sage Chandler, vice president-international trade. She asked to appear at Aug. 20-23 hearings to oppose 10 percent Trade Act Section 301 tariffs proposed by the Office of the U.S. Trade Representative. Members identified 302 tariff lines of Chinese imports in USTR sights, with more than $109 billion in value, for which 10 percent duties “would be detrimental,” said Chandler's Friday filing. Harmonized Tariff Schedule codes that most worry members would affect startups using U.S. IP, research, design and engineering, said Chandler. Duties on those products would cause “substantial” harm to the entire IoT “ecosystem,” she said. What spooks Chandler most is a “single line item,” HTS 8517.62.00, listed as covering machines for reception, conversion and transmission or regeneration of voice, images or other data, she told us Monday. That “captures servers, gateways, modems,” plus “Bluetooth-enabled devices, like headsets, speakers, fitness trackers, smart health devices and watches,” she said. It exposes “basically the entire ecosystem of the internet,” she said. “You’re looking at what potentially could be pass-down costs everywhere along the chain for the Internet of Things."

It’s an “understatement to say” NXP Semiconductors is “disappointed in the outcome of the regulatory approval process in China” that doomed Qualcomm’s $44 million NXP buy (see 1807250062), said NXP CEO Rick Clemmer on a Thursday earnings call. The combined Qualcomm/NXP would have “represented the true semiconductor industry powerhouse,” he said. NXP’s mission now is not to “dwell on what could have been” but to “focus on what we can do to accelerate and expand our leadership,” said Clemmer. Amid questions about “the level of commitment of the NXP executive management team” now that the Qualcomm deal died 21 months after its inception, “the management team, including Peter and myself, are fully committed to continue to drive the future success of NXP,” said Clemmer, referring to Chief Financial Officer Peter Kelly. NXP took an estimated $31 million hit in Q2 from the Commerce Department’s ban on materials shipments to ZTE that caused disruptions to NXP’s RF power components business “and to a lesser degree our digital networking and other businesses,” said Clemmer. Shipments to ZTE have resumed and will “hopefully continue” as normal for the rest of the year, said Kelly. Clemmer suggested Chinese regulatory authorities refused to approve the Qualcomm buy in retaliation for the ZTE ban because it “was considered to be one of the factors in the discussions with the Chinese relative to the regulatory approval process.” Clemmer finds it quite surprising “that the Chinese made the decision they did, not to actually approve the transaction, given that ZTE was brought back to life” by the Trump administration and Congress, he said. Representatives of China’s Foreign Ministry didn’t comment Friday, nor did Qualcomm, which Thursday blamed the NXP deal's demise on the "geopolitical environment" (see 1807260005).