US Considering Cutting China’s Cloud Computing Access

Reuters reports that the Biden administration is considering tightening its export restrictions to China even further, following China’s legislative move that allows it to essentially bottleneck exports of rare earth metals – gallium and germanium) required for semiconductor fabrication. Except now, the dance isn’t about hardware or tech exports: it’s actually about access to US-based cloud computing capabilities (and especially those with Artificial Intelligence hardware). This is but the latest move in the continuously-escalating economic and logistical tensions, which have historically resulted in higher pricing for hardware components as friction is added to the worldwide supply-chain.

Following years of less-than-stellar results from the US’ imposed technological export rules to China, the US is now seemingly looking to cut into another escape route used by China to acquire access to the latest and greatest processing power: cloud computing. If you can’t acquire the latest chips for your own data center, you can always purchase access to them in a cloud environment; that’s exactly the scenario the White House wants to see end by forcing cloud computing providers such as Microsoft, Google, Amazon and others to seek a licence with the US government in order to serve chinese customers. As usual, the U.S. Department of Commerce will oversee the execution of this added restriction, which is expected to be implemented in the coming weeks.