China reportedly is ramping up its cyber-security and spying dispute with the United States by asking banks in that country to remove IBM servers and replace them with systems built by Chinese companies.
Citing four unnamed people familiar with the Chinese government's review on the matter, Bloomberg is reporting that government officials from such agencies as the People's Bank of China and Ministry of Finance are urging banks to make the switch away from IBM systems in favor of local brands.
The recommendation is the latest move by China in a high-stakes back-and-forth between the country and the United States over the issues of cyber-spying and national security that has been going on for several years, with the latest revelations from former National Security Agency (NSA) analyst Edward Snowden and the United States' indictment this month of five Chinese military officers for allegedly hacking into the systems of U.S. companies accelerating the dispute.
According to reports, the Chinese government's review on how dependent the banks are on IBM systems has not been made public, but that the results of the review will be sent to a working group on Internet security led by President Xi Jinping. For their part, IBM officials have said they have yet to hear about any efforts by the Chinese government to ban Big Blue servers.
"IBM is not aware of any Chinese government policy recommending against the use of IBM servers within the country’s banking industry," IBM spokesman Jeff Cross told Bloomberg. "In fact, news reports now state that China’s National Development and Reform Commission has not heard of any alleged directive to that effect. IBM is a trusted partner in China and has been for more than 30 years."
The Chinese government's latest efforts come as IBM continues the process of selling its commodity x86 server business to Lenovo, a Chinese company. The $2.3 billion deal reportedly is getting close scrutiny from the U.S. government.
It also follows China's banning this month of Windows 8 from government PCs.
U.S. lawmakers for several years have pointed to China as a source of cyber-attacks, and have questioned whether the close relationship major Chinese tech vendors like Huawei and ZTE have with their government poses a security threat to the United States. A congressional report in 2012 expressed such concerns and urged U.S. telecommunications companies to avoid buying networking gear from those two companies for fear that they could include backdoors that would give the Chinese government access to U.S. networks and sensitive data, and could become a launching pad for cyber-attacks.