What just happened? We’re used to hearing about the US imposing trade restrictions on Huawei, but that’s not the only tech giant being affected by America’s ongoing battle with China. Intel has suspended shipments to Inspur, the world's third-largest server manufacturer and China's largest, to ensure compliance with US government export regulations.
Update (7/3): According to Chinese media Intel has already resumed shipments to Inspur. They were quoted earlier this week saying they've had to adjust their supply chain to ensure compliance with US laws and that may take "no more than two weeks" to resume supplies, however it seems the hold has been much shorter than that.
Last week, the Pentagon announced 20 companies it said were owned by, controlled by, or affiliated with China’s military. Huawei was one of those named, of course, as was Inspur. The list was mandated under the Defense Authorization Act of 1999, but this is the first administration to put out the report.
Following the publication of the Pentagon list, Intel told Tom’s Hardware: "We have temporarily paused shipments to one customer in order to ensure compliance with U.S. Government export regulations. This is a temporary pause expected to last less than two weeks for some items, and others will resume in a matter of days. We will resume shipments as soon as we can do so while ensuring compliance with U.S. law."
While Intel never mentioned Inspur by name, it was responding to a question about the firm, which is focused on cloud computing, big data, key application hosts, servers, storage, artificial intelligence, and ERP (Enterprise Resource Planning).
As China’s largest AI and traditional server supplier, and the third-largest in the world, Inspur is a big customer for Intel. The news saw the Chinese company’s shares fall almost 5 percent yesterday.
While US trade restrictions mean Huawei’s new smartphones lack Google’s suite of apps, it doesn’t have to worry about its server business being affected. The firm, which sits behind Inspur as China’s second-largest server supplier, uses its own Arm-based chips in its servers.