Published: Sat, July 07, 2018
Business | By Eloise Houston

Micron receives Chinese ban, sees 1 percent impact on quarterly revenue

Micron receives Chinese ban, sees 1 percent impact on quarterly revenue

United States chipmaker Micron has run into trouble in a court battle in China, according to one of its rivals.

The company also confirmed in a statement for the first time that two of its subsidiaries had been temporarily banned from selling some its products in China, following a complaint from rivals United Microelectronics Corporation (UMC) and Fujian Jinhua Integrated Circuit Co.

According to the semiconductor industry on July 4, UMC, a Taiwanese chipmaker, announced on July 2 that the Fuzhou City Court of China issued a preliminary injunction order of ban on the sale of Micron products in China. The shares rose as much as 3.6 percent, rebounding from a fall of more than 5 percent on Tuesday when UMC claimed victory in the law suit. Moreover, Micron has submitted compelling evidence to the Patent Review Board of China's State Intellectual Property Office demonstrating that the patents are invalid because they are directed to technologies that were previously developed and patented in other countries by other technology companies. Beijing wants to change that and has set aside billions of dollars to bolster local companies.

In the semiconductor industry, experts say that China pursuing the rapid growth of the Chinese semiconductor industry sided with the Chinese company. "Near-term this could favor non-US chipmakers vs". The deal has been approved by regulators in eight other jurisdictions including the European Union and South Korea. China recently did not hide its will to hold Korean semiconductors in check while conducting an antitrust investigation of these largest DRAM producers.

The delay in approving the deal has coincided with uncertainty over the fate of Chinese smartphone and telecommunications company ZTE.

The trade dispute has intensified in recent months as President Trump accused Chinese companies of stealing American technology, particularly in chips. But ZTE still faces an uncertain future, and some members of Congress are seeking to keep the ban in place.

Simultaneously, China is trying to reduce its dependence on imported chips. China buys far more chips than any other country, and about 90% came from foreign companies past year, according to technology consultancy International Business Strategies. UMC has devoted a great deal of resources and manpower to researching and developing semiconductor manufacturing technology.

UMC has not commented on the poaching allegations. In 1Q18, Micron's NAND Flash revenue ranked the fourth worldwide with a market share of 12%, following 37% of Samsung, 19% of Toshiba and 15% of WDC.

Like this: