Sunday, May 28, 2023

Largest North American memory maker puts up against canvas

It is a fact that the tension between America and China is increasing. We must remember that from October 2022 the US government included the entire Chinese semiconductor industry in its sanctions aimed at slowing down their technological development, preventing them from accessing advanced lithography equipment.

China did not remain silent and the Cyberspace Administration of China (CAC), the Chinese internet regulator, launched an investigation in late March 2023 to audit the largest US maker of memory chips, Micron Technology.

The authority suspected at the time that Micron’s DRAM memory chips had the potential to compromise its country’s security and has now issued findings that put the company in “compromised” status.

A ‘security risk’ China says

The resolution details that Micron’s products “pose serious network security risks, significantly compromising the security of critical national security information in China’s supply chain and in transit.” A result that matches the sanctions of the United States.

Of course, the CAC resolution does not detail what risks have been identified in the chips, nor which specific products are affected, although in practice it will seek to prevent the company from selling its components in China, However, it is yet to be defined the scope of the sanctions and from when the prohibition will come into effect.

In any case, it’s not a promising scenario for Micron, as the Chinese market represents about 10% of its revenue.

Solution and pressure

The US manufacturer, for its part, has confirmed that it is cooperating with the Chinese administration, although details of its agreements to prevent sanctions from taking effect have not been revealed.

Micron is not alone on this path, as it has the support of the United States government, with President Biden, for example, seeking to protect the company’s interests by including two large South Korean memory makers.

As part of its move, the United States has asked South Korea to stop supplying semiconductors to China by Samsung Electronics and SK Hynix if Micron pulls out of the market due to sanctions.

However, it is still too early to see whether the United States’ move will have the expected results, but it does appear the tension between the two countries is blocking their technological development, without a favorable short-term outcome for either side.

World Nation News Desk
World Nation News Desk
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