Yesterday, a new front opened in the US-China technology war.
According to the Financial Times, Beijing is examining how dependent its state-owned data centers are on Broadcom. And the initial findings suggest that its switches may account for as much as 90% of their equipment.
But pay attention to when this news comes out. Just one day before Xi Jinping sits across from Donald Trump in Washington.
Coincidence? Maybe. But it is difficult to ignore.
BROADCOM UNDER THE MICROSCOPE
SASAC, the Chinese state body that oversees state-owned enterprises, has been investigating for weeks how widespread Broadcom’s switches are in state-owned data centers. And the answer is... very widespread.
“What are these switches?” you might be wondering. Put very simply, they are the network of a data center. They allow thousands of chips and servers to communicate with one another. And as AI models get larger, this part becomes increasingly critical.
And Broadcom is right at the center of it. It makes networking equipment, but it also designs custom AI chips for major cloud companies. In the third quarter of 2026, its revenue reached $29.6 billion, up 86%. And AI semiconductors alone generated $16.7 billion. A 221% increase. Yes, you read that correctly. For the next quarter, the company expects around $21.7 billion from that business alone.
There is no ban, at least not yet. Based on the initial findings, however, SASAC could issue informal guidance to state-owned data centers to limit their use of Broadcom switches. Reuters was unable to immediately confirm the report.
And this is where things get even more interesting. Just a few days earlier, US and Chinese officials agreed on a new mechanism for dialogue on AI. On one hand, they are building bridges. On the other, during the very same week, Beijing is measuring how dependent it is on an American company.
A negotiating chip? There is no public evidence of that. But the timing is certainly noteworthy.
THE REVERSE QUESTION
Now look at what is happening.
For years, in the US-China technology war, the question was simple. How much American technology will the US allow to reach China? And US restrictions on advanced semiconductors have already created major obstacles for Chinese companies.
Now, however, a reverse question is emerging.
How quickly can China reduce its dependence on American technology?
Beijing is already running a campaign under the slogan “domestic chips for domestic use.” It wants Chinese semiconductors and Chinese AI technology throughout the public sector. It is also supporting smaller specialized companies, which it calls “little giants.” And Nvidia has already been excluded from state-owned data centers.
But AI has raised the bar. It is no longer enough to have your own smartphones, telecommunications equipment, or electric vehicles. You need an entire ecosystem. Chips, accelerators, networking, cloud infrastructure, software, and massive data centers.
And this is exactly where Huawei enters the picture. It is already selling switches in China alongside Broadcom and Nvidia. It is also developing its own hardware and networking solutions for AI.
THE WASHINGTON TABLE
Xi Jinping is already in the US for an official visit from September 23 to 25. And today he is sitting across from Trump.
The agenda is heavy. Trade, tariffs, critical raw materials, artificial intelligence, and of course, China’s access to advanced American technology.
According to Bloomberg, Nvidia’s Jensen Huang, OpenAI’s Sam Altman, Microsoft’s Satya Nadella, and Apple’s Tim Cook are expected at the official dinner for Xi. US officials also mentioned Elon Musk, Jeff Bezos, and Sundar Pichai.
Imagine the scene. The two presidents sitting at the same table with people who control a huge portion of the world’s AI infrastructure.
Nvidia with its GPUs. Microsoft and Google with cloud computing and AI platforms. OpenAI with its models. Apple with its hardware. And behind all of them, companies like Broadcom, which rarely make the headlines but whose technology supports much of this infrastructure.
So what does all of this mean?
It means the meeting is not just about tariffs and trade deficits. It is also about who will control the technological infrastructure of the next decade.
