China reviews dependence on Broadcom switches in data centres

Chinese authorities are investigating Broadcom’s hardware usage in state-backed data centers, according to the Financial Times. The investigation aims to strengthen domestic producers and decrease reliance on foreign AI infrastructure amid the ongoing rivalry with the United States. China has emphasized technological self-sufficiency and supply-chain resilience, supporting smaller specialized companies known as "little giants."

The State-owned Assets Supervision and Administration Commission (SASAC), which oversees state-owned enterprises, has been surveying the extent of Broadcom’s switches in state-controlled data centers recently. According to the report, Broadcom switches might make up as much as 90% of the equipment currently in use. Based on the preliminary findings, SASAC may issue informal guidance suggesting state-run data centers reduce their use of Broadcom switches as part of China's domestic chips for domestic use campaign.

The campaign aims to expand the adoption of Chinese-made semiconductors and AI technology in the public sector. Broadcom, alongside Nvidia and China’s Huawei, sells high-end switches within the country. However, Nvidia products have already been prohibited from state-backed data centers, leaving Broadcom’s switches widely present in these facilities.