What's going on?

China took a shot at Micron over the weekend, the latest skirmish in the US-China chip war.

What does this mean?

China�s had a chip on its shoulder ever since the US threw a wrench in its ability to source some of the world’s most cutting-edge processors. And the fact that a bunch of other nations took a leaf out of America�s book � bringing in tough export controls of their own � has only fanned the flames of the Middle Kingdom�s ire. So it�s not exactly a shock the country�s seeking sweet revenge. After a seven-week investigation, the Cyberspace Administration of China announced that products made by Micron � the biggest memory-chip manufacturer in the US � pose serious security risks. That�s seen China take its first real step against an American chipmaker, banning operators of critical infrastructure from buying Micron�s products.

Why should I care?

Zooming in: The chip has sailed.
Micron�s fortunes seem to hang on China�s definition of �critical information infrastructure� � but if the country�s buyers play it safe and ditch Micron en masse, this move could seriously hurt. After all, some estimates suggest that China and Hong Kong accounted for up to a quarter of Micron�s sales last year, so it�s no wonder its stock took a nosedive when the news broke. Still, it�s an ill wind that blows nobody any good, and this development probably has the firm�s rivals � like Samsung, SK Hynix, and the Chinese firm SMIC � rubbing their hands in glee.

The bigger picture: Dreaming of d�tente.�
Newsflash, US chipmakers � you�re no longer guaranteed a warm welcome in the world�s biggest chip market. That read-my-lips statement from China will have fellow American titans like Broadcom and Intel hoping that Biden�s right: the president�s now predicting a thaw in the two countries� relations before long, after China�s alleged spy balloon saw them grow very frosty indeed in recent times.