LEXIS-NEXIS® Academic Universe-Document

LEXIS-NEXIS® Academic

March 17, 1999, Wednesday, Home Edition

SECTION: Business; Part C; Page 3; Financial Desk

LENGTH: 539 words

HEADLINE: TECHNOLOGY;
COMPUTER FIRMS PUSH FOR RELAXING EXPORT CURBS;
TECHNOLOGY: THE INDUSTRY COMPLAINS TO LAWMAKERS OVER 'OUTDATED' RESTRICTIONS.

BYLINE: JUBE SHIVER Jr., TIMES STAFF WRITER

DATELINE: WASHINGTON

BODY:
Silicon Valley executives asked federal lawmakers Tuesday to ease U.S. export restrictions that could soon lock American computer manufacturers out of the booming Chinese market.

The U.S. restricts the sale of so-called supercomputers to China, Iraq, North Korea, India, Russia and about three dozen other nations in an effort to thwart the spread of nuclear weapons. Enacted a few years ago when most computers weren't as powerful as they are now, the law requires American companies to get government authorization before they can export supercomputers. Today's personal computers are approaching the speed and power of supercomputers of just a few years ago.

The export issue is coming to a head because Intel Corp. and some other computer chip makers are set to begin mass marketing billions of dollars worth of microprocessors that are too powerful to be sold to China, Russia, India and other restricted countries.

Calling the export rules "outdated," Dan Hoydysh, a Unisys Corp. executive who serves as co-chairman of the Computer Coalition for Responsible Exports, told members of the Senate Banking Committee on Tuesday, "We must face the fact that yesterday's supercomputer has become today's laptop."

Hoydysh's comments drew some support from R. Roger Majak, the Clinton administration's assistant secretary for export administration. He told the Senate panel that "the diffusion of technology around the world means that many controlled products are widely available."

The Capitol Hill showdown over export controls comes as a coalition of computer companies, including Intel, International Business Machines Corp., Dell Computer Corp. and Apple Computer Corp., stepped up their campaign to persuade federal lawmakers to ease export laws that Congress tightened about a year ago.

Intel spokesman Bill Calder said the company derives about 60% of its revenue from overseas sales. But he said the overseas market for Intel microprocessors depends on the ability of the giant chip maker to get its most sophisticated products to customers without delay. Otherwise, Calder said, they will turn to European or Asian competitors that do not face similar constraints.

To bolster its lobbying efforts, the industry coalition released a study Tuesday that claimed foreign competition to U.S. PC makers is growing and that eight major PC makers overseas already make high-speed computer equipment whose performance exceeds the U.S. export control threshold of 2,000 million theoretical operations per second, or MTOPS.

A single Intel Pentium III chip performs nearly 1,200 MTOPS. When two or more such chips are packaged on a single PC circuit board, the computing power can exceed the control threshold.

The coalition's report estimates that foreign manufacturers this year will sell nearly 800,000 computers that have computing power greater than the export restrictions.

But the coalition could be in for a cold reception from Republicans who view their hard line against China as a way of dramatizing a foreign policy distinction with the White House.

The Clinton administration has been criticized by several members of Congress for its alleged lax supervision of high-tech transfers to China.

LOAD-DATE: March 17, 1999