China spying on Apple, Amazon and over 20 other companies

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Tiny chips inserted in U.S. computer equipment manufactured in China were used as part of a vast effort by Beijing to steal USA technology secrets, a published report said Thursday.

Microchips were secretly inserted by Chinese spies in Supermicro motherboards found in the USA government and some of the biggest tech companies. The report has been deemed not accurate by companies named in it as well as by the Chinese government.

In 2015, Amazon began evaluating a video software startup called Elemental Technologies as part of its plan to expand its streaming service now called Amazon Prime Video, according to Bloomberg.

Elemental servers assembled by Supermicro are "found in Department of Defense data centers, the CIA's drone operations, and the onboard networks of Navy warships", per Bloomberg, and the revelation prompted DoD officials at the time to request a small group of technologists "to think about creating commercial products that could detect hardware implants".

On Wednesday, the U.S. government warned that a hacking group known as cloudhopper - which cybersecurity firms have linked to the Chinese government - has launched attacks on technology service providers to steal data from their clients.

China was well placed to carry out this kind of attack, said Bloomberg, because 90% of the world's PCs are made in the country.

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Apple said in a statement it "has never found malicious chips, "hardware manipulations" or vulnerabilities purposely planted in any server". "China is a resolute defender of cybersecurity", the Chinese foreign ministry told Bloomberg.

Amazon and Apple both strongly rejected the findings, which Bloomberg said were based on conversations with 17 anonymous sources, including insiders at both tech giants. More than 30 victims are reported, including juggernauts like Amazon's Web Services, and Apple. "We have repeatedly and consistently offered factual responses, on the record, refuting virtually every aspect of Bloomberg's story relating to Apple".

According to the Bloomberg report, the microchips, which were the size of a grain of rice, provided China with a way to remotely access the computers.

The chips reportedly subvert the hardware on which they are installed, draining data while also delivering new code, as does a Trojan horse.

Apple took Bloomberg to task, saying the agency had contacted it "multiple times with claims, sometimes vague and sometimes elaborate, of an alleged security incident".

Bloomberg also reported that Apple in 2015 found malicious chips in servers it purchased from the hardware maker, then stopped doing business with Super Micro in 2016 for reasons that were not related, citing three unnamed company insiders. Apple, Amazon, and Supermicro deny any knowledge of such an attack. Apple and AWS deny these moves involving Super Micro were related to chip worries. "We are not aware of any investigation by the FBI, nor are our contacts in law enforcement".

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