China is striking a new blow in its chip wars with the United States, reportedly telling its telecommunications companies to phase out foreign-made chips from their networks.
Earlier this year, Chinese officials issued guidance to China’s largest telecom companies, including China Mobile and China Telecom, to stop using foreign core processors by 2027, the Wall Street Journal reported, citing sources familiar with the matter. And that spells shaky news overseas for two key American chipmakers: Intel and Advanced Micro Devices (AMD).
Intel and AMD have provided most of the core chips used in Chinese telecom network infrastructure in recent years, sources said — and losing this line of Chinese business would impact them more than any other foreign chipmakers. Instead, Chinese telecom companies will turn to homegrown chips, which have improved in the nation.
As a part of the slowdown, state-owned mobile operators have been directed by China’s Ministry of Industry and Information Technology to inspect their networks for foreign-made chips and produce a timeline to replace them, sources told the Journal.
Chip security
China has been pushing to phase out foreign-made products in the country due to national security concerns, the Journal reported. In March, China introduced new guidelines eliminating Intel and AMD chips from government computers and servers in favor of domestic-made alternatives. The new rules seek to block foreign technology from federal computers, including operating systems like Microsoft’s Windows and other database software made overseas, according to the Financial Times. Neither Intel nor AMD immediately responded to a request for comment.
Meanwhile, the United States is also stepping up efforts to curb Chinese advanced chipmaking, and has reportedly asked South Korea — one of China’s key trading partners — to adopt export controls on semiconductor tools. U.S. officials have requested that South Korea restrict exports of equipment and technology used to make memory chips and advanced logic chips, Bloomberg reported.
The U.S. is also reportedly set to reveal the names of Chinese companies on its blacklist for receiving U.S.-made chipmaking equipment. American companies are restricted from sending equipment to Chinese semiconductor factories.