Future Tech

China orders its telcos to rip and replace US chips with homegrown silicon by 2027

Tan KW
Publish date: Sat, 13 Apr 2024, 11:26 PM
Tan KW
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Future Tech

Years after Uncle Sam ordered US telecommunications providers to rip and replace Huawei kit from their networks, Beijing is telling telcos in China to strip out American-made chips.

On Friday, Chinese officials reportedly ordered its top telecoms players to eliminate foreign semiconductors - primarily those from Intel and AMD - within the next three years.

The order would include China Telecom, China Mobile, and China Unicom, three of the nation's largest providers. Operators will be required to submit draft timelines for replacing that foreign silicon.

The decision, handed down by the Ministry of Industry and Information Technology, doesn't bode well for Intel and AMD: As of 2023, the Chinese market accounted for 27 percent and 15 percent of their revenues, respectively.

The directive comes a little over four years after the FCC barred Huawei and ZTE-made telecommunications equipment from US networks. At issue were concerns that, due to Chinese laws mandating the sharing of info with Beijing, Huawei and ZTE could be forced to place backdoors in its equipment to facilitate intelligence gathering operations. Huawei, for its part, has repeatedly denied this would ever happen and insisted it abides by local laws wherever it operates.

Now, it seems, Beijing is ready for revenge. However, it's not clear at this point what, if any, support will be provided to its telcos to offset the cost of replacing foreign chips with homegrown silicon.

As we saw with US efforts to rid itself of Huawei kit, the ordeal could end up being quite costly for Chinese network operators. Despite setting aside $1.9 billion to reimburse carriers, the FCC received more than $5.6 billion in cash requests.

The 2027 deadline is only the latest in an ongoing effort by the Chinese government to end its reliance on US technologies.

Late last year, Beijing issued a list of 18 CPUs approved for use by its citizens. Notably missing from said list were Intel and AMD, though as we previously reported China hasn't ousted x86 just yet. The list does include x86 parts made by Shanghai Zhaoxin Integrated Circuit Co, which make use of Via Technology's blueprints.

China's shift from Western tech has intensified in response to American trade restrictions designed to deny the Middle Kingdom access to leading-edge processor technologies required for AI, as well as the chipmaking equipment necessary to achieve self sufficiency in the near term.

Despite these efforts, Chinese companies, including Huawei and Semiconductor Manufacturing International Co (aka SMIC) have been remarkably successful at building relatively high-end silicon. Earlier this week, it was revealed Huawei was building a research and development facility outside Shanghai aimed at accelerating development of homegrown chipmaking equipment for parts used in wireless, networking, and smartphones. ®

 

https://www.theregister.com//2024/04/13/china_telco_chips/

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