Data centre hardware hit by US-China trade war
Wed 7 Nov 2018
The recent tariffs imposed by the Trump administration on China in September included duties on a range of consumer and business tech that caused alarm among OEMs
In the escalating trade war, it was announced that $200 billion worth of Chinese imports were to be subject to ten percent tariffs, with warnings of further duties if China chose to retaliate.
Almost immediately the tariffs drew protest from technology companies. While there is good news for consumer tech products, the news is not so good for business tech consumers. In response to manufacturer protects, the US government withdrew a number of big name consumer tech products from the final list, such as Apple’s AirPods and iWatch.
However, computer servers and networking gear that power data centres – including some of the parts for the machines used to make semiconductors – were not spared, and now face a levy.
Despite protests from Cisco, Dell, HPE, and Juniper Networks – that all called for networking and server equipment to be dropped from the final list – the US government decided to keep the proposed tariffs in place, prompting an almost immediate price hike from OEMs, price increases that have now been passed onto consumers.
According to Reuters the group told regulators: “By raising the cost of networking products, the proposed duties would impede the development and adoption of cloud-based services and infrastructure.”
Network World has now revealed details of the price hikes. Almost immediately Cisco increased the price of several of its products by 15 percent. Juniper Networks hiked networking product prices 3.5 percent with further increases scheduled at the turn of the year. Finally, as of October 1st Arista Networks increased all hardware products by 3.3 percent. Network World say these are just a few of the OEMs that have increased their prices.
As if this wasn’t bad enough, there is further negative news on the horizon. The current 10 percent tariffs imposed by the Trump administration is set to jump by 15 percent to 25 percent by January next year.