NSA Fallout: Tech Firms Feel a Chill Inside China

Spencer E. Ante, Paul Mozur, and Shira Ovide

China represents about 10% of the global technology market, and accounts for 15% to 20% of global hardware demand, according to CLSA. The bank says Chinese companies control about 70% of the domestic market for telecommunications gear, but Western companies account for roughly 70% of sales of computer servers.

China has long promoted Chinese technology suppliers, at the expense of foreign brands. But some observers detect a heightened push in recent months. The U.S.-China Business Council warned in an October report that Chinese regulators are pushing policies to subsidize domestic companies and promote cybersecurity in ways that will hurt foreign providers. Research firm Gartner echoed those concerns in an October report that mentioned weak sales of computer servers by IBM and HP.