The trade conflict between the US and China is intensifying as China’s cyberspace authority, CAC, has banned the sale of products from US memory manufacturer Micron due to potential national security threats. The review process, which lasted for a month, did not clarify which products are affected or why Micron’s memory chips pose a security risk. The CAC only stated that Micron’s products contain “potentially relatively significant network security issues”, creating major security risks to China’s information infrastructure and supply chains.
The CAC has urged operators of critical infrastructure to no longer buy Micron products. The semiconductor industry analyst views China’s actions as a counter to US export controls, saying that halting sales from US manufacturers like Micron would only have a temporary effect as supply chains would adjust to other product offerings, which are readily available from other manufacturers in China and South Korea.
Yangtze Memory Technologies, the largest domestic memory chip manufacturer in China, could be one alternative, but it is impacted by US export controls, making it difficult to obtain chip-making machines.
Micron, however, remains relatively unaffected as it only generates 11% of its total sales in China. In comparison, other manufacturers such as Nvidia, AMD, and Intel generate over 20% of their sales in China. Broadcom and Qualcomm are hit even harder, given that their sales in China account for 35% and 64% of total sales, respectively.
Micron responded that it is still evaluating the Chinese review results and is looking forward to continuing talks with Chinese authorities.