The tech giants, the US and the Chinese spy chips that never were… or were they?

John Naughton:

On 4 October, Bloomberg Businessweek published a major story under the headline “The Big Hack: How China Used a Tiny Chip to Infiltrate US Companies”. It claimed that Chinese spies had inserted a covert electronic backdoor into the hardware of computer servers used by 30 US companies, including Amazon and Apple (and possibly also servers used by national security agencies), by compromising America’s technology supply chain.

According to the Bloomberg story, the technology had been compromised during the manufacturing process in China. Undercover operatives from a unit of the People’s Liberation Army had inserted tiny chips – about the size of a grain of rice – into motherboards during the manufacturing process.

The affected hardware then made its way into high-end video-compression servers assembled by a San Jose company called Supermicro and deployed by major US companies and government agencies. According to the report, investigators found that the hack eventually affected almost 30 companies, including a major bank, government contractors and Apple, which had originally ordered 30,000 Supermicro servers in 2015 but had cancelled the order after its own investigators had found malicious chips on the company’s motherboards.