Tech

China to Force Telcos to Abandon Foreign Chips 

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Chinese authorities required local telecom companies to gradually eliminate foreign chips, specifically targeting from Intel & AMD by 2027. 

Earlier this year, the Chinese authorities required major local telecom companies to gradually eliminate foreign chips, specifically targeting those from Intel and AMD by 2027. 

According to the Wall Street Journal, this requirement is part of the country’s broader plan to replace foreign technology with local options. This shift marks another escalation of the ever-growing tensions between two global powerhouses, the U.S. and China, especially over high-tech exports. 

WSJ also noted that following the news, the shares of both chip manufacturers fell over 1.5% before the market opened.   

Intel has chosen not to comment on the issue, while AMD has not responded to inquiries about the report. 

China’s efforts to reduce its dependence on foreign technology is an ongoing process. Last year’s reports indicated that Beijing was also trying to move away from U.S. technology in its government offices. It indeed recommended the adoption of locally produced software and hardware. 

Similarly, the Ministry of Industry and Information Technology in China has issued instructions to state-owned mobile operators to check their systems for non-Chinese chips and implement strategies for their replacement. This step follows earlier guidelines for eliminating U.S. chips from government computers and servers. 

The decision to gradually remove foreign chips is a major hit for companies like Intel. Last year, China made up Intel’s largest market, accounting for more than a quarter of its total revenue.  

This transition by Chinese telecom operators is reportedly gaining pace, supported by improvements in the performance and reliability of local chip technologies. China’s strategic move seeks to enhance its technological sovereignty and mitigate vulnerabilities amidst international trade and security disputes. 

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