US-China Chip Wars: Citing Serious Cybersecurity Risks, Beijing Bans Products Of U.S. Memory Chipmaker Micron

China's cyberspace regulator announced on Sunday (May 21) that products made by leading U.S. memory chipmaker Micron Technology posed "serious network security risks" and would be banned for sale to China's key information infrastructure operators.

The move is viewed as a retaliatory measure by China over Washington, targeting the Chinese semiconductor industry by introducing export controls and related restrictions. Washington has imposed crippling export controls on chipmaking technology to China, effectively depriving Micron rival Yangtze Memory Technologies of buying specific American components.

"The review found that Micron's products have serious network security risks, which pose significant security risks to China's critical information infrastructure supply chain, affecting China's national security," the Cyberspace Administration of China (CAC) said in a statement.

"Companies and platforms are welcome to introduce products and services into Chinese market as long as they conform to the requirements of Chinese laws and regulations," the statement added.

The ban will effectively stop Chinese customers in critical industries ranging from energy to finance to stop purchasing Micron products and services.

Earlier this year, Beijing said that it is carrying out a detailed review to ensure supply chain security for China's critical information infrastructure operators (CIIOs) and to ward off cybersecurity risks,

In 2022, China accounted for more than 10 per cent of Micron's $30.8 billion revenue. Lenovo, Xiaomi, Inspur Electronics Information, ZTE, Coolpad, China Electronics Corp and Oppo are among Micron's key customers in China.

Micron is among a handful of semiconductor manufacturers capable of producing DRAM (Dynamic random access memory, a specific type of RAM chip). It holds a 23% global market share. Samsung is the dominant player with a 41.7% share, followed by SK Hynix Inc. (30%).

Micron also holds around 12% market share in NAND flash memory technologies.

Micron has a global manufacturing footprint and R&D network spanning 13 countries. It operates manufacturing facilities in U.S., Taiwan, Japan and Singapore, and chip packing facilities in China and Malaysia.

Taiwan serves as the production hub for Micron as the memory chip supplier at present operates A1 and A2 plants with a back-end packaging and testing site in Taoyuan City.

DRAM and flash memory chips are essential to smartphones, data centres, computers, cars and other items.

Memory and storage form a significant portion of the global semiconductor industry, representing approximately 30% of the $460 billion semiconductor industry.