Brian Matta
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Intel Corporation's Plans of Working with China Crushed

Intel Corporation's (NASDAQ: INTC) plans to update China's Tianhe-2, the world's fastest super computer, with its latest Xeon chips that would have made Tianhe-2 almost three times faster was blocked by the U.S. government. The sell of the Xeon clips to China was blocked because under the U.S. export regulations, they have a right to stop the exportation of any technologies whose design, development, or fabrication can be used in making nuclear weapons. Also the U.S. claims that the selling of these chips could act contrary to the countries national security and foreign policy interests.

Intel did not dispute the ban. According to the, these chips would have generated Intel $1 billion to $1.3 billion in revenue, which would have added to Intel's $14 billion in revenues last year. Even though Intel may lose profit, China will look elsewhere to update their super computer. The Chinese company, Loongson, has made chips that China could use for its super computer. However, Loongson's chips are less complex than Intel's Xeon chips, but they are also less powerful than Intel's. These challenges are what China will have to figure out in order to move forward in the updating of their super computer. 

Intel is not the first and probably not the last company whose product has been banned by the U.S. government. Tech Giant's such as Apple, Google, and Microsoft have all run against U.S. foreign policy. This interference with international business by the U.S. is to impede China's ability to grow in the technical arms race. It is forcing China to look for local companies instead of well known tech giants, which most are located in the U.S.