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The Chinese government has opened an investigation into US memory vendor Micron citing national security risks.
The investigation, announced in a brief statement by Cyberspace Administration of China (CAC), offers little in terms of detail. Translated from Chinese, the agency cites potential “security risks caused by hidden product problems,” in chips sold by Micron in China. We take this to mean China is hunting for back doors baked into Micron’s products that could pose a threat to its national security.
The CAC statement bears striking similarities to allegations made by the US against Chinese telecom equipment vendor Huawei. The US warns that, due to the company’s close ties to the Chinese government, its equipment could be remotely co-opted to spy on foreign nations. Both Huawei and the Chinese embassy have denied these claims, but that hasn’t stopped a costly rip-and-replace order in the US and UK from moving forward.
The consequences of these actions to Huawei’s financials have been considerable. According to Huawei’s annual report, published this week, the company saw its profits slip 69 percent in 2022 on $92 billion in revenues.
Given the timing, China’s investigation into Micron could be viewed as retaliatory for US efforts to snuff out Chinese competition in the semiconductor and telecommunications space.
However, China is now facing opposition on multiple fronts, with The Netherlands — home of lithography giant ASML — announcing trade restrictions on advanced chipmaking equipment in March. And, earlier today, Japan joined the party, enacting similar trade restrictions of its own.