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(Reuters) — Huawei plans to introduce its Harmony operating system, seen as the company’s best bet to replace Google’s Android mobile operating system, on smartphones next year, the head of its consumer business group said on Thursday.

Richard Yu made the comments at the company’s annual developers conference in the southern Chinese city of Dongguan. He also said that the company had a 2.0 version of the system that it first unveiled last year and that it planned to open to developers a beta version for smartphones in December.

Huawei’s addition to the U.S. entity list in May last year barred Google from providing technical support for new Huawei phone models using Android, and from Google Mobile Services (GMS), the bundle of developer services upon which most Android apps are based.

That led the company to experience a slump in overseas smartphone sales, although that was later offset by a surge in domestic sales. Yu said the company shipped 240 million smartphones last year, which gave it a second-place market ranking, but added that software shortages had hurt the company in recent months.

Huawei has billed Harmony as a multi-device platform across watches, laptops and mobiles rather than as a like-for-like challenger to Google’s Android mobile operating system.

In August, the U.S. expanded earlier restrictions aimed at preventing Huawei from obtaining semiconductors without a special license — including chips made by foreign firms that have been developed or produced with U.S. software or technology.

Analysts said the restrictions threaten Huawei’s crown as the world’s largest smartphone maker, a ranking it gained this year, and that its smartphone business would disappear entirely if it could not source chipsets.

Yu did not comment on the topic during his speech.

(Reporting by David Kirton in Shenzhen. Writing by Brenda Goh. Editing by Jason Neely and Gerry Doyle.)

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