Sci-tech information: "IBM elimination" triggers market race in China
Chinese authorities may move to ban banks in the country from using servers made by IBM, according to a published report.
The plan comes amid mutual recriminations and charges of cyber-espionage between the U.S. and China, and is seen as a largely retaliatory act by the People's Republic.
Bloomberg reported Tuesday that the Chinese government may cite security concerns to formally block the use of high-end IBM servers at its banks and planned to encourage the use of domestically produced large server farms for banks in response to a growing concern over the possibly negative effects of the monopolistic status of IBM's large servers on the nation's financial security.
A number of central-level government agencies are jointly probing possible risks associated with IBM's monopoly on servers, including the Ministry of Industry and Information Technology, the Ministry of Science and Technology, the National Development and Reform Commission, the Ministry of Finance, the People's Bank of China (the central bank) and the China Banking Regulatory Commission. The agencies are also reviewing whether IBM is selling servers in China at prices much higher than in other nations.
The move comes at the heels of a number of government moves to shed reliance on foreign firms in certain sectors, mostly out of concerns over national security. Windows 8, for example, has been added to the blacklist for government procurements. State enterprises have been required to sever ties with McKinsey and Boston Consulting Group over suspicions of their engagement in espionage for the US government.
IBM has dominated the global high-end server market due to the rigid demand of the financial and telecommunications industries for IBM mainframes, said China Business News.
Such a move could cost IBM millions of dollars in lost hardware and maintenance sales. The ban could include the System z mainframe and Power line of servers.
The report, which cited unnamed individuals said to be familiar with the government's plans, said China wants its financial institutions, including the People's Bank, to replace Big Blue machines with hardware from local suppliers.
In the wake of the outbreak of the Prism scandal that laid bare the digital espionage of the US National Security Agency last June, China has kicked off a movement shedding reliance on the three global leaders in servers, databases and storage €" IBM, Oracle and EMC, dealing a severe blow to their business in China. The development might have contributed to the sales decline of IBM's system and technology group department starting in last year's third quarter.
Understand that China's concerns about the security of U.S.-made IT products are largely political in nature. Conduct internal security testing or use reliable third-party reports for all new systems.
IBM servers and data storage systems feature multi-level security protections and have been used for years by the vast majority of major U.S. financial institutions, including Bank of America, JPMorgan Chase, and Citigroup.
Tensions between China and the U.S. have escalated in the past month after American authorities indicted five Chinese military officers on charges of cyber-espionage. Prosecutors alleged that the individuals hacked into the corporate networks of private U.S. companies to steal trade secrets.
China responded by announcing that it would review the operations of foreign tech and consulting companies operating within its borders. The Financial Times reported earlier this week that consulting firm McKinsey & Co. may see its contracts with Chinese clients terminated.
Snowden fallout: China may be set to bar its banks from using IBM equipment.
Last week, the Chinese government said it would ban Microsoft's Windows 8 operating system on government computers, citing security concerns.
In August, 2013, Chinese officials said they planned to investigate IBM, Oracle, and EMC due to €security concerns.€
Some analysts believe China's reprisals can also be traced to revelations by NSA leaker Edward Snowden that the U.S. government sought out the aid of American tech firms when it came to spying on its global rivals.
"Local vendors like Huawei, Inspur, and Lenovo will likely benefit from the NSA/Snowden issue; they will gain share mostly in the hardware space, including server, storage, and networking, in 2014," Forrester analyst Bryan Wang said in a blog post late last year.
Chinese CIOs "are cautious about holding off buying foreign tech equipment, pending new governmental policy in the coming years," Wang said, in a previous post. "We expect these organizations to have to continue working with global suppliers, given that local vendors will find it difficult to solve several of their most complex IT challenges in the short term."
China represents a significant market for U.S. tech companies. Forrester estimates that enterprise IT sales in the country will grow 8% in 2014. An IBM spokesman did not immediately respond to an e-mail seeking comment. To alleviate the negative effect, IBM has expressed support for the development of China's server industry, providing IBM Power framework, POWER8 technology, and chip designing tools to a Suzhou-based hi-tech firm and Jiangsu Industrial Technology Research Institute, following their joining of Open POWER Foundation in January this year.
For more sci-tech information, goes to: http://en.twwtn.com/Information/
Chinese authorities may move to ban banks in the country from using servers made by IBM, according to a published report.
The plan comes amid mutual recriminations and charges of cyber-espionage between the U.S. and China, and is seen as a largely retaliatory act by the People's Republic.
Bloomberg reported Tuesday that the Chinese government may cite security concerns to formally block the use of high-end IBM servers at its banks and planned to encourage the use of domestically produced large server farms for banks in response to a growing concern over the possibly negative effects of the monopolistic status of IBM's large servers on the nation's financial security.
A number of central-level government agencies are jointly probing possible risks associated with IBM's monopoly on servers, including the Ministry of Industry and Information Technology, the Ministry of Science and Technology, the National Development and Reform Commission, the Ministry of Finance, the People's Bank of China (the central bank) and the China Banking Regulatory Commission. The agencies are also reviewing whether IBM is selling servers in China at prices much higher than in other nations.
The move comes at the heels of a number of government moves to shed reliance on foreign firms in certain sectors, mostly out of concerns over national security. Windows 8, for example, has been added to the blacklist for government procurements. State enterprises have been required to sever ties with McKinsey and Boston Consulting Group over suspicions of their engagement in espionage for the US government.
IBM has dominated the global high-end server market due to the rigid demand of the financial and telecommunications industries for IBM mainframes, said China Business News.
Such a move could cost IBM millions of dollars in lost hardware and maintenance sales. The ban could include the System z mainframe and Power line of servers.
The report, which cited unnamed individuals said to be familiar with the government's plans, said China wants its financial institutions, including the People's Bank, to replace Big Blue machines with hardware from local suppliers.
In the wake of the outbreak of the Prism scandal that laid bare the digital espionage of the US National Security Agency last June, China has kicked off a movement shedding reliance on the three global leaders in servers, databases and storage €" IBM, Oracle and EMC, dealing a severe blow to their business in China. The development might have contributed to the sales decline of IBM's system and technology group department starting in last year's third quarter.
Understand that China's concerns about the security of U.S.-made IT products are largely political in nature. Conduct internal security testing or use reliable third-party reports for all new systems.
IBM servers and data storage systems feature multi-level security protections and have been used for years by the vast majority of major U.S. financial institutions, including Bank of America, JPMorgan Chase, and Citigroup.
Tensions between China and the U.S. have escalated in the past month after American authorities indicted five Chinese military officers on charges of cyber-espionage. Prosecutors alleged that the individuals hacked into the corporate networks of private U.S. companies to steal trade secrets.
China responded by announcing that it would review the operations of foreign tech and consulting companies operating within its borders. The Financial Times reported earlier this week that consulting firm McKinsey & Co. may see its contracts with Chinese clients terminated.
Snowden fallout: China may be set to bar its banks from using IBM equipment.
Last week, the Chinese government said it would ban Microsoft's Windows 8 operating system on government computers, citing security concerns.
In August, 2013, Chinese officials said they planned to investigate IBM, Oracle, and EMC due to €security concerns.€
Some analysts believe China's reprisals can also be traced to revelations by NSA leaker Edward Snowden that the U.S. government sought out the aid of American tech firms when it came to spying on its global rivals.
"Local vendors like Huawei, Inspur, and Lenovo will likely benefit from the NSA/Snowden issue; they will gain share mostly in the hardware space, including server, storage, and networking, in 2014," Forrester analyst Bryan Wang said in a blog post late last year.
Chinese CIOs "are cautious about holding off buying foreign tech equipment, pending new governmental policy in the coming years," Wang said, in a previous post. "We expect these organizations to have to continue working with global suppliers, given that local vendors will find it difficult to solve several of their most complex IT challenges in the short term."
China represents a significant market for U.S. tech companies. Forrester estimates that enterprise IT sales in the country will grow 8% in 2014. An IBM spokesman did not immediately respond to an e-mail seeking comment. To alleviate the negative effect, IBM has expressed support for the development of China's server industry, providing IBM Power framework, POWER8 technology, and chip designing tools to a Suzhou-based hi-tech firm and Jiangsu Industrial Technology Research Institute, following their joining of Open POWER Foundation in January this year.
For more sci-tech information, goes to: http://en.twwtn.com/Information/
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