China bans AMD and Intel CPUs as well as Windows from government computers

China business of American hardware companies China bans AMD and Intel CPUs as well as Windows from government computers

2024-03-27 From Susanne Braun | Translated by AI 2 min Reading Time

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The Chinese government has reportedly released new directives banning CPUs and various software from US manufacturers from government computers and servers. It is believed that Intel and AMD are about to face financial losses as a result.

China is reportedly planning to eliminate AMD and Intel processors from government hardware.(Image: freely licensed / Pixabay) — China is reportedly planning to eliminate AMD and Intel processors from government hardware.
(Image: freely licensed / Pixabay)

Trade relations between the US and China regarding hardware and software products, due to various sanctions on both sides, now resemble a walk through a minefield. The sanctions enacted have far-reaching effects on the technology and trade sector and on geopolitical relations - and these impacts are not solely restricted to the US and China.

The US has imposed sanctions on Chinese companies including Huawei and ZTE, resulting in restrictions on access to US technology and components. China has imposed similar restrictions on US companies.

According to a report by the Financial Times (via Reuters), the Chinese government has now announced new guidelines that aim to ban processors from AMD and Intel from government computers and servers. Microsoft's Windows, as well as other database software from Western manufacturers, are also expected to be removed from the hardware. Domestic products, such as processors from Phytium and Loongson, are intended to serve as replacements. Financial analysts assume that the CPU ban could lead to significant revenue losses for the companies Intel and AMD.

Despite all sanctions, China still represents a highly profitable market for many companies. In 2023, Intel generated around 27 percent of its sales revenues in China, and AMD around 15 percent, reports the Financial Times (via Tom's Hardware).

Investments in R&D required.

The replacement of components in Chinese government hardware will of course not be feasible overnight. It is assumed that despite recent advances in the chip industry, China is still technologically lagging behind in most cases by about ten years. The switch to domestically produced hardware would present a considerable challenge for China, according to the authors of Tom's Hardware. China would need to invest a significant amount of time and money in research and development in order to supply itself with processors.

"Even with the stolen technology they can reverse engineer, the fabrication plants are dependent on other factors. Chinese companies like SMIC and HLMC, like all other semiconductor manufacturers, rely on raw materials and other technology sources from other companies in their respective countries. The Chinese CPU Zhaoxin KX-7000 is considered six years behind, but is based on the x86 architecture," says Roshan Ashraf Shaikh of Tom's Hardware.

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