China planning to purge foreign tech from the enterprise and replace with homegrown suppliers

“China is aiming to purge most foreign technology from banks, the military, state-owned enterprises and key government agencies by 2020, stepping up efforts to shift to Chinese suppliers, according to people familiar with the effort,” Bloomberg News reports. “The push comes after a test of domestic alternatives in the northeastern city of Siping that was deemed a success, said the people, who asked not to be named because the details aren’t public. Workers there replaced Microsoft Corp.’s Windows with a homegrown operating system called NeoKylin and swapped foreign servers for ones made by China’s Inspur Group Ltd., they said. The plan for changes in four segments of the economy is driven by national security concerns and marks an increasingly determined move away from foreign suppliers under President Xi Jinping, the people said. The campaign could have lasting consequences for U.S. companies including Cisco Systems Inc., International Business Machines Corp., Intel Corp. and Hewlett-Packard Co.”

“China is moving to bolster its technology sector after Edward Snowden revealed widespread spying by the U.S. National Security Agency and accused the intelligence service of hacking into the computers of Tsinghua University, one of the China’s top research centers,” Bloomberg reports. “Foreign suppliers may be able to avoid replacement if they share their core technology or give China’s security inspectors access to their products, the people said. The technology may then be seen as safe and controllable, they said. China ranks second behind the U.S. in technology spending, with outlays rising 8.1 percent to $182 billion last year, according to research firm IDC. The U.S. spent $656 billion, a 4.2 percent increase over 2012.”

“‘I see a trade war happening. This could get ugly fast, and it has,’ said Ray Mota, chief executive officer of Gilbert, Arizona-based ACG Research, who expects the issue to result in direct talks between the U.S. and China. ‘It’s not going to be a technology discussion. It’s going to be a political discussion,'” Bloomberg reports. “Other cities and agencies in Jilin will now begin testing whether NeoKylin, a Linux-based operating system from China Standard Software Co., can substitute for Windows and servers made by Inspur can replace IBM’s, the two people familiar with the plan said. The trial will then expand across the country, they said.”

Read more in the full article here.

MacDailyNews Take: Patented intellectual property be damned, as always.

46 Comments

  1. If the NSA wants to be useful they can shut down internet connections with North Korea. We are still in a state of war with them and they just fired another shot at us. At least the French didn’t mind with the movie Day of The Jackal.

  2. China is counting on the west’s addiction to cheap products made in Chinese factories to have their cake and eat it too.

    The Chinese have always believed they are the rightful rulers of the planet, and if you ignore what they say and, watch what they do, you will see that they are moving incrementally towards that goal.

  3. I know that the NSA has the ability to monitor electronic transmissions but I don’t remember hearing about US companies cooperating by installing back doors to there software. Above posts mention this, are we talking fact of fiction?

    1. We know they weakened products through corrupting encryption standards. We know they intercepted shipped products and installed back doors. And we know they operate back doors in telecom data rooms. They also tap directly into undersea fiber optic trunk lines.

      All illegal.

      No reason to doubt they also have back doors in shrink-wrapped products.

  4. Gauging from the excellent feedback it seems that this topic is finally causing a few lights to come on. It’s about time.

    The U.S. has been going down the path to becoming a wannabe threat to the civilized world and to other parts of the world as well as endangering global stability. It looks like some are finally realizing that. Obviously the civilized and the rest world will react to this deviation of their constitution.

    The crossroad is coming up pretty fast, and I know a lot of you from the civilized world are wondering if the U.S. will finally grow a spine and regain some morality and ethics. I’d personally love to see this, I’d love to see power of the American people bring to justice those Americans responsible for the torture and the crimes against humanity. I doubt it very much but it’s nice to see the lights going on.

    MDN poster 84 Mac Guy has put the right spin on it.

    It’s not going to be easy but the alternative is to let it get to the point it did with the slaves. That costs a lot of lives, still dear readers of the civilized wold but it’s their choice….for now. Let’s hope now that the lights are coming on actions worthy of honor and integrity will follow.

  5. I see this differently.

    I see this as similar to the state of affairs in the west when the WinTel hegemony ruled business, government, military and nearly everything else. Apple then was the outlier and faired ok and then with Steve’s return began the slow climb to the top. Apple will be there in China as the technology of the rest of them.

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