China launches mysterious probe into security of Palo Alto Networks' products

China’s Cyberspace Administration (CAC) has conducted a review of Palo Alto Networks’ products. The regulator’s announcement of its review says it’s needed “to ensure the safe and stable operation of critical information infrastructure, prevent cybersecurity risks and vulnerabilities, and safeguard national security.” And that’s all Beijing has to say on the matter. A Palo Alto spokesperson provided The Register with the following statement: "We maintain the highest standards of business conduct and security practices and ethics across our global operations. At this time, there is no impact to our ability to support customers or deliver our products and services in the region." This matter has echoes of China’s 2023 investigation into the security of products from memory-maker Micron, which the CAC announced out of the blue. Micron had previously fought intellectual property and antitrust cases in China, but the company and Chinese authorities did not explicitly link those matters to the security probe. The CAC published its findings weeks after announcing the probe and decided Micron’s products represented an unacceptable security risk for critical infrastructure operators – effectively banning sales of Micron products to such entities – but didn’t offer a detailed explanation for its decision. The memory-maker eventually stopped selling its datacenter and server products in China, a decision that cost it billions of annual revenue – but created new opportunities for China’s own memory-makers, which are largely prohibited from selling to American companies. China is home to several security companies whose product portfolios overlap with Palo Alto’s. Huawei and H3C, for example, have plenty to offer local buyers. Palo Alto doesn’t reveal revenue earned from individual countries, so it’s hard to know what a potential ban could cost the company. China has for years accused Western tech companies of assisting US surveillance and offensive hacking activities. The Register would not be surprised at all if Beijing reuses that reasoning in its findings about Palo Alto products. Western governments level the same accusations at Huawei and ZTE. Beijing’s ban on Micron didn’t noticeably impact the company’s reputation elsewhere. Indeed, the AI boom has brought Micron such great riches that past dents to its bottom line are now almost irrelevant. ®

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