Expert likens U.S.–China sanctions to 'a pillow fight, not a chip war' — contends regulations are merely a 'licensing regime' with holes chipmakers are 'driving cars through'

China and the US chess board
(Image credit: Shutterstock)

Leland Miller, chief executive of China Beige Book, a boutique market research company specializing on China, offered an interesting perspective on the ongoing trade war between the U.S. and China when it comes to advanced processors and technologies for artificial intelligence and high-performance computing. From his point of view, the conflict looks more like a pillow fight than a war, and chipmakers are 'driving cars' through holes in the regulations.

"It is not a serious; it is a pillow fight, not a chip war," Miller told Yahoo! Finance.

The head of CBB downplayed the conflict and indicated that the situation is not as restrictive as commonly thought, with the U.S. Department of Commerce frequently approving technology exports to China. While companies like Nvidia may not be able to sell their top-of-the-range products to the People's Republic, there is a functioning system in place where companies request permission to sell certain products to China, and the DoC approves exports of products that offer lower performance but still belong to the latest generation of technologies developed in the U.S.

Miller's view contrasts with the popular narrative of a harsh technological standoff. He emphasizes that the idea of a strict ban on advanced technology exports to China does not match reality. 

"All the chip makers basically live at the White House pushing for the regulations to be eased and eased and eased," Miller said. "The reality is that there is not broad ban on sending advanced technology to China. The headlines say there is. But you do not have broad prohibitions for the most part on sending this technology. What you have is a licensing regime."

Miller notes that the approval rate for these technology exports is high. This approval process contradicts the widespread belief of a severe embargo on high-tech exports. According to him, the flow of advanced technology from the U.S. to China continues relatively unimpeded, with many American companies still actively engaging in commerce with Chinese counterparts.

"There is not this wall that is being set up and in which case U.S. technology and Western technology is not flowing to China," Miller said. "There are Swiss cheese holes in it. And right now, chipmakers are driving cars through them."

Anton Shilov
Contributing Writer

Anton Shilov is a contributing writer at Tom’s Hardware. Over the past couple of decades, he has covered everything from CPUs and GPUs to supercomputers and from modern process technologies and latest fab tools to high-tech industry trends.

  • Co BIY
    The Circus of the "Bread and Circus" doesn't have to be viciously gladiatorial when the audience will settle for WWF.

    I guess I do think about the Roman Empire everyday ....