China has launched an anti-monopoly investigation into US chipmaker Nvidia, citing possible violations linked to its acquisition of Mellanox Technologies in 2020. The move is widely seen as retaliation against recent US restrictions on China’s semiconductor sector, including curbs on advanced chip exports.
Nvidia, which dominates China’s AI chip market, is accused of breaching conditions tied to the Mellanox deal, such as fair trade requirements and restrictions on bundling products. The probe comes amid heightened trade tensions, with Beijing encouraging local companies to avoid US chips and Washington tightening export controls on critical semiconductor technologies.
Analysts suggest the investigation is unlikely to significantly impact Nvidia in the near term, as its most advanced chips are already restricted from sale in China. However, the company faces growing competition from domestic firms like Huawei. China accounted for 17% of Nvidia’s revenue last year, down from 26% two years prior, as US-China tech conflicts continue to reshape the global semiconductor landscape.
The US House of Representatives is preparing to vote on a defence bill proposing $3 billion for telecom companies to replace equipment from Chinese firms Huawei and ZTE. The legislation aims to address security concerns posed by Chinese technology in American wireless networks. A previous allocation of $1.9 billion was deemed insufficient for the programme, which the Federal Communications Commission (FCC) estimates will cost nearly $5 billion.
The initiative, known as the ‘rip and replace’ programme, targets rural carriers reliant on the equipment, which could lose connectivity if funding gaps persist. FCC Chair Jessica Rosenworcel warned that insufficient funding might force some rural networks to shut down, endangering services such as 911 emergency calls. Rural regions face significant risks without immediate support for the removal and replacement of insecure telecoms infrastructure.
The proposed funding would also cover up to $500 million for regional technology hubs, supported by revenue from an FCC spectrum auction. Advocates emphasise the importance of securing connectivity while maintaining services for millions of Americans. Competitive Carriers Association CEO Tim Donovan welcomed the proposed funding, calling it critical for network security and consumer access.
American TikTok creators are urging their followers to connect on platforms like Instagram and YouTube after a federal appeals court upheld a law that could ban TikTok in the US unless its Chinese parent company, ByteDance, sells its American operations by January 19. The looming deadline has sparked anxiety among creators and businesses reliant on TikTok’s vast reach, which includes 170 million US users.
The platform’s popularity, especially among younger audiences, has turned it into a hub for creators, advertisers, and small businesses, with features like TikTok Shop driving significant economic activity. Some creators, like social media influencer Chris Mowrey, expressed fears about losing their livelihoods, emphasising the potential economic blow to small enterprises and content creators.
While some users are bracing for a shutdown, others remain sceptical about the ban’s likelihood, holding off on major changes until more clarity emerges. In the meantime, creators like Chris Burkett and SnipingForDom are diversifying their presence across platforms to safeguard their communities and content. For many, the uncertainty surrounding TikTok’s future is a stark reminder of the fragile nature of digital ecosystems.
Jack Ma, co-founder of Alibaba, made a rare public appearance on Sunday, expressing optimism about the future of Ant Group, the fintech affiliate he also helped establish. Speaking at Ant’s 20th-anniversary celebration, Ma highlighted the transformative potential of AI, stating that the changes driven by AI in the next two decades will surpass current expectations. His remarks, reported by Chinese media outlet 36kr, marked a notable return to the spotlight following his retreat from public life amid regulatory challenges.
Reflecting on Ant Group’s turbulent journey, Ma acknowledged the value of criticism and encouragement in fostering the company’s growth. Ant, the operator of China’s leading mobile payment app Alipay, faced a regulatory crackdown after Ma’s public critique of Chinese regulators in 2020. This led to the cancellation of Ant’s $300 billion IPO, followed by a stringent overhaul of its operations to align with financial regulations. The reforms included Ma relinquishing control of the company in 2023.
Despite these challenges, Ant is charting a path forward, underscored by a leadership transition announced Sunday. President Cyril Han will succeed Eric Jing as CEO starting March 1, 2024. Ma’s renewed confidence in Ant’s potential, especially in the AI era, signals a fresh chapter for the fintech giant as it emerges from years of regulatory scrutiny.
A US federal appeals court has upheld a law requiring TikTok’s Chinese parent company, ByteDance, to sell its US operations by 19 January or face a nationwide ban. The ruling marks a significant win for the Justice Department, citing national security concerns over ByteDance’s access to Americans’ data and its potential to influence public discourse. TikTok plans to appeal to the Supreme Court, hoping to block the divestment order.
The decision reflects bipartisan efforts to counter perceived threats from China, with Attorney General Merrick Garland calling it a vital step in preventing the Chinese government from exploiting TikTok. Critics, including the ACLU, argue that banning the app infringes on First Amendment rights, as 170 million Americans rely on TikTok for creative and social expression. The Chinese Embassy denounced the ruling, warning it could damage US-China relations.
Unless overturned or extended by President Biden, the law could also set a precedent for restricting other foreign-owned apps. Meanwhile, TikTok’s rivals, such as Meta and Google, have seen gains in the wake of the decision, as advertisers prepare for potential shifts in the social media landscape.
The US-China tech export war is intensifying as both nations continue pushing their antagonistic agendas to curb the other’s technological advancements. As expected, trade tensions between the USA and China are escalating again in the semiconductor sector as four top Chinese industry associations have recently warned against purchasing US chips, claiming they are ‘no longer safe’ and threaten national security principles. The Chinese associations, representing major industries from telecommunications to the digital economy, have opted for a considerable change in the mindset of Chinese businesses. They are now advised to consider non-US suppliers to safeguard their operations and reduce reliance on US technology.
The industry associations’ response follows the latest US crackdown, targeting China’s semiconductor industry. The new restrictions, introduced by the US Department of Commerce, extend to 140 Chinese companies and cover a broad range of products, including critical semiconductor equipment and high-bandwidth memory used in AI chip development. These measures aim to limit China’s access to advanced technologies essential for its military modernisation and AI capabilities, with the Biden administration labelling the restrictions necessary for US national security.
However, Beijing is far from passive in this ‘tech conflict’. Chinese authorities have been ramping up retaliatory measures in response to the curbs. One of the most notable moves came last year when China blocked US chipmaker Micron from some government purchases following a failed security review. Similar scrutiny has been directed at other US tech giants like Intel, with significant revenue from China. Furthermore, China has increasingly turned to its ‘unreliable entity list’ to target US firms, such as PVH Corp, probed for complying with US sanctions on Xinjiang cotton, showing China’s determination to impose economic and market barriers on American companies.
China has also used its control over rare earth materials as leverage, imposing export restrictions on critical elements like gallium, germanium, and antimony. These materials are vital for semiconductor manufacturing and military applications, and their abundance means China’s strategic advantage in global supply chains. In addition to the listed, the recent imposition of new export controls on dual-use technologies to US military users or for military purposes further underscores China’s strategy to regulate products that have both civilian and military applications. The change in course aims to secure China’s rise and dominance in these sectors and limit US access to critical technologies needed for advanced military and AI applications.
Amid these tensions, the semiconductor sector has become a focal point of a global power struggle. The USA has restricted the sale of advanced chipmaking equipment to China, focusing mainly on equipment from US-based companies such as Lam Research and Applied Materials and European suppliers like ASML. While China has made strides toward becoming more self-sufficient in semiconductor manufacturing, the US curbs continue to impact China’s access to cutting-edge equipment and expertise essential for advancing its chip technology. Despite the setbacks, Chinese companies, such as Empyrean and Nata Opto-Electronic, have been building equipment stockpiles and pushing for greater localisation to mitigate the effects of the sanctions.
The expanding reach of US export controls also affects global partners, including Japan and the Netherlands, which supply critical chipmaking equipment to China. While Japan and the Netherlands have been exempt from some of the curbs, their involvement in the US rules still limits the scope of their exports to China. However, the USA seems quick to monitor and enforce these regulations, further entangling allies in the conflict.
The conclusion is that the escalating tech conflict between the USA and China provokes deepening concerns in the two governments about data security, military supremacy, and leadership in critical areas like AI and semiconductors. With both countries fiercely safeguarding their strategic priorities, this tech rivalry is poised to reshape global supply chains, innovation landscapes, and the overall power dynamics in the tech sector, undoubtedly influencing the world economy for years to come.
New export restrictions will ignite global trade tensions.
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A senior US official revealed that a Chinese hacking group, known as ‘Salt Typhoon,’ has stolen vast amounts of Americans’ metadata in a broad cyberespionage effort targeting US telecommunications. While specific figures remain undisclosed, the hackers are said to have breached at least eight American telecom firms, including Verizon, AT&T, and T-Mobile.
Call record metadata — detailing who called whom, when, and where — was a key target, exposing sensitive personal and professional patterns. In some cases, telephone audio intercepts were also reportedly stolen. The campaign remains active, with the White House prioritising efforts to counter the intrusions.
Government agencies, including the FBI and the National Security Council, have briefed lawmakers and President Joe Biden on the matter, highlighting the severity of the breach. Efforts to secure the nation’s telecommunications infrastructure are ongoing.
Apple and Baidu are collaborating to bring AI features to iPhones in China, leveraging Baidu’s Ernie 4.0 language model. However, technical challenges, including the AI’s response accuracy and understanding of prompts, have slowed progress.
Sales pressures in China are mounting for Apple, with its market share slipping and Huawei reporting significant growth. Criticism of the iPhone 16‘s lack of AI features has further strained Apple’s competitive position in the region.
Privacy policies also pose hurdles, as Apple’s restrictions prevent Baidu from collecting data from AI interactions, potentially limiting the effectiveness of these features. Siri is expected to incorporate Baidu’s AI models.
In recent years, China and Russia have significantly ramped up efforts to advance their semiconductor equipment industries, aiming to secure competitive positions in the global market. While the US, Netherlands, Japan, and South Korea dominate the semiconductor equipment sector, China’s aggressive R&D investments in etching, CVD, PVD, and packaging technologies are helping it make strides in domestic substitution. However, the country still lags in high-end lithography equipment, especially EUV machines.
Despite challenges, China’s semiconductor equipment market is expected to see record-high purchases in 2024, surpassing $40 billion. Experts attribute this growth to localisations, new fabs, and global supply chain concerns. However, demand is expected to stabilise in 2025 once production lines are up and running, although long-term growth remains promising, fueled by applications in 5G, AI, and automotive electronics.
Meanwhile, Russia has accelerated its efforts to develop domestic semiconductor equipment, receiving over $2.5 billion in government funding. With a focus on manufacturing 200mm wafers for chips with nodes from 180nm to 90nm, Russia aims to reduce reliance on imports. The country’s ambitious goal is to replace 70% of imported equipment with domestically produced alternatives by 2030. Despite progress, Russian manufacturers like Angstrem and Mikron are still constrained to mature process nodes, depending on imported lithography systems.
US agencies have briefed senators on ‘Salt Typhoon,’ a Chinese cyber-espionage campaign allegedly targeting American telecommunications networks. Officials claim the hackers stole call metadata and other sensitive information, affecting at least eight US telecom firms and dozens of companies worldwide. The breaches have sparked bipartisan concern, with some senators pressing for stronger preventive measures and legislation.
Telecom giants like Verizon, AT&T, and T-Mobile acknowledged the incidents but downplayed the impact on customer data. Federal agencies, including the FBI and Cybersecurity and Infrastructure Security Agency, emphasised the challenge of fully removing hackers from networks, while incoming FCC Chair Brendan Carr pledged to strengthen cybersecurity defences.
China has denied the allegations, calling them disinformation. Meanwhile, a Senate subcommittee hearing on December 11 will focus on the risks posed by such cyber threats and explore ways to protect US communications infrastructure.
