Chinese hardware hack – the damage is done

The hack by a Chinese group on the hardware used by American technology companies has soured things up for both countries. On Thursday, Bloomberg Businessweek reported that a Chinese military unit inserted tiny microchips into the motherboards of servers sold by Supermicro Computer with the intention of illegal surveillance and collection of sensitive information.

These servers were said to have been used by major tech firms including Apple (AAPL) and Amazon (AMZN). Several US technology companies that sell laptops, mobile phones and servers get their products assembled in China. The hack is said to have affected 30 companies, including one whose servers were reportedly used by the US government and military agencies.

Even though it was reported that an investigation, involving the FBI, is ongoing, all parties named in the incident disputed the report. Apple and Amazon denied finding any malicious chips or hardware in their servers while FBI and other officials refused to comment on the subject.

It is not clear how much data was taken but it appears that no consumer information was accessed. These types of hardware attacks are said to be both difficult to carry out and fix. It is not easy to install such spy chips without them causing some sort of disruption to the function thereby exposing themselves.

At the same time, if such malicious hardware was installed, it would be a tedious job to find each affected device and deduce the amount and severity of the damage done. This incident has once again put the spotlight on the concerns raised by the US officials over China being involved in the theft and manipulation of American technology and has brought forth the issue of national security.

There is already much tension between the US and China over the trade war and this matter is likely to add fuel to the fire. In the midst of all the allegations, denials and speculations, the bottom line is that the damage has been done and this incident has muddied the waters for both American and Chinese companies that have been working together thus far.