China investigates Broadcom switch usage in state-owned data centers

China's State-owned Assets Supervision and Administration Commission (SASAC) has reportedly begun investigating the extent to which Broadcom network switches are deployed within state-owned enterprise data centers. Preliminary findings suggest that Broadcom equipment may account for as much as 90% of the switches used in these facilities.

This investigation aligns with Beijing's policy of promoting domestic semiconductor and AI technology usage to reduce reliance on foreign infrastructure. While Nvidia products have already been excluded from state-owned data centers, Broadcom switches remain widely utilized. SASAC may issue informal guidelines to gradually reduce the proportion of Broadcom equipment in favor of domestic alternatives like Huawei.

Industry observers note that while the move supports supply chain localization, domestic alternatives like Huawei may currently face challenges regarding energy efficiency compared to Broadcom products. The potential restrictions are reportedly aimed at state-owned entities and do not currently apply to private companies such as Alibaba or ByteDance, nor will existing equipment be removed.