White House weighs ban on Chinese optical transceivers in data centers

The FCC is reportedly drafting rules to restrict Chinese-made optical transceivers used in data centers, citing risks of data theft, malware, or disruption. The White House wants to impose restrictions in 2026, and China has said it will respond if the ban goes ahead.

Why it matters: This extends US-China tech decoupling from chips into the physical networking layer AI data centers depend on, adding supply-chain risk for hyperscalers who source optical components globally. A ban could raise costs and slow buildouts just as AI infrastructure investment accelerates, and invites Chinese retaliation on components the US industry also needs.