Beijing has ordered all government offices and public institutions to remove foreign computer equipment and software within three years, in a potential blow to the likes of HP, Dell and Microsoft.
The move is part of a broader campaign to increase China’s reliance on home-made technologies, and is likely to fuel concerns of “decoupling”, with supply chains between the US and China being severed.
Analysts at China Securities, a broker, estimate that 20m to 30m pieces of hardware will need to be swapped out as a result of the Chinese directive, with large-scale replacement beginning next year. They added that the substitutions would take place at a pace of 30 per cent in 2020, 50 per cent in 2021 and 20 per cent the year after, earning the policy the nickname “3-5-2”.
The analysts noted that the order had come from the Chinese Communist party’s Central Office earlier this year.
https://www.ft.com/content/b55fc6ee-1787-11ea-8d73-6303645ac406
Maintaining the AI Chip Competitive Advantage of the United States and its Allies CSET Issue Brief
Semiconductor industry sectors have localized in different regions based on the comparative advantages of those regions. Key sectors include:
(1) basic research;
(2) electronic design automation software used to design chips;
(3) chip design;
(4) semiconductor manufacturing equipment (SME);
(5) materials providers;
(6) semiconductor fabrication plants (fabs) that manufacture chips based on chip designs using SME and materials;
(7) assembly, testing, and packaging of manufactured chips; and
(8) distribution of chips.
The SME and fab sectors for leading node chips have consolidated into just a few companies in a small number of countries because of significant technical challenges and high costs limiting new competitors, combined with significant economies of scale.
http://cset.georgetown.edu/wp-content/uploads/CSET-Maintaining-the-AI-Chip-Competitive-Advantage-of-the-United-States-and-its-Allies-20191206.pdf