Microsoft lobbies Trump White House to block ban on Chinese optical transceivers used in AI data centers

Microsoft is pressing the Trump administration to abandon a planned ban on Chinese data center technology, specifically optical transceivers that move data across fiber-optic cables within data centers at the speed of light. The Federal Communications Commission has been working on a measure to bar U.S. imports of new models of these Chinese-made components, citing national security concerns including risks of data theft, malware installation, and service disruption at facilities that house AI training chips.

The push from Microsoft underscores the tension between national security policy and the practical realities of the AI infrastructure buildout. Chinese firms, led by Innolight with roughly a 27% share of the global data center transceiver market, hold a dominant position that U.S. competitors such as Coherent and Lumentum currently lack the scale to replace. Microsoft's lobbying signals that major U.S. cloud and AI operators are deeply reliant on this Chinese-sourced equipment and fear that an abrupt import ban would disrupt data center expansion plans.