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Apple Bows To Political Pressure, Won’t Use Chinese Chips In iPhones

Apple has cancelled its plans to use flash memory chips from China’s Yangtze Memory Technologies Co. in its products, amid tightening controls against Chinese tech companies.

Apple had already completed testing to certify YMTC’s 128-layer 3D NAND flash memory for use in its iPhones, with plans to start using the chips this year.

While YMTC’s 128-layer chips are 20 per cent cheaper than those rivals Micron and Samsung, they are also one or two generations behind.

Apple was originally planning to use the YMTC memory in Chinese iPhones, but later considered sourcing up to 40 per cent of the NAND flash memory needed for all iPhones from YMTC.

US policymakers criticised the deal between Apple and YMTC, a government-funded company, which saw the tech giant change tack.

While YMTC are not one of the Chinese companies on the ban list, they were placed on the ‘Unverified List’ on October 7, meaning U.S. officials cannot verify a clear chain of its end-users.

US companies are allowed to source components from Chinese companies on the Unverified List, but cannot share any design, technologies, documents or specifications without a licence.

“The products have been verified, but they did not go into the production lines when mass production of the new iPhone began,” a source told Nikkei Asia.

“YMTC is government-subsidised so they can really outprice competitors.”

While Apple can still source the cheaper memory, it clearly isn’t worth the political headache for them.


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