USA-based semiconductor manufacturer ‘Micron’ has recently failed a security test in China.
Micron Technology Inc is an American company that produces computer memory, and data storage units like hard drives, solid-state drives, and flash drives. The memory-chip giant has failed China’s network security review.
The investigation report and the subsequent ban on the purchase of their products by operators of crucial infrastructure come during a dispute between China and America over chip technology. The ban over the purchase of Micron manufactured products can be applied to infrastructure operators like telecom. transport, finance, security, and many more as the authorities didn’t limit their definition of crucial infrastructure by not defining it.
The Cyberspace Administration of China (CAC) released a statement regarding their decision to ban the purchase of these chips. Their review found Micron manufactured chips to have serious network security risks that could pose a significant security risk to China’s crucial infrastructure supply chain.
CAC did not provide details on what these risks which they found are, nor which products from the chip manufacturer were found to have these risks. However, this decision will likely not affect Micron much as their major buyers are for consumer electronics, not infrastructure suppliers.
CAC’s statement comes during the G7 summit in Japan, where last week Micron announced their plan to invest US$3.70 Billion, making them the first chipmaker to bring advanced manufacturing technology to Japan which seeks to restart its chip manufacturing industry.
Usually, 10% of the company’s revenue comes from China (US$5.2 Billion last year which made up 16%). A large chunk of their products that reach China are purchased by non-Chinese firms for use in their products manufactured in China. It is unclear whether CAC’s decision will affect the chipmaker’s business in other countries.
USA President Joe Biden said the G7 nations had planned to “de-risk and diversify” their relations with China. The USA has also imposed export control on chipmaking technology to China and prevented Micron’s rival Yangtze Memory Technologies from buying certain American components.
Micron’s rival in South Korea, Samsung Electronics, was previously urged by the USA President in April (A month after CAC’s investigation into Micron began in March) to not fill in the gap which may be left by Micron if China decides to ban them.
Beijing has broadly defined the industries it considers “critical” as ones such as public communication and transport but it has not specified exactly what type of company or business scope this will be applied to.