Intel, one of the world’s largest semiconductor companies, is suspending business operations in Russia “effective immediately,” the company announced Tuesday.
“Intel continues to join the international community in condemning Russia’s war against Ukraine,” the company said in a sentence. Intel stopped shipping chips to customers in Russia and Belarus in early March.
Intel said it is “working to support all of our employees through this difficult situation, including our 1,200 employees in Russia.”
Normally, it would be a drastic step for a multinational company like Intel to exit a market the size of Russia. But Western sanctions have made it more difficult for international companies to operate in Russia. Earlier this week, the Biden administration announced broad sanctions on the Russian electronics industry, which presumably includes many of Intel’s partners and customers in Russia.
The departure of many tech companies could make it difficult for Russian companies and the Russian government to access IT gear at a time when the war is placing new demands on Russian networks.
In March, the publication of the IT company Data industry dynamics perceive that the Russian government is taking spare data center power from Western countries fleeing Russia:
Russian business publication Kommersant reports that the authorities are preparing to buy all the power in business data centers (which may include already contracted IT), and take the IT resources of companies that have announced their withdrawal from Russia.
The country has already shown a tendency to acquire the assets of companies that have left – with McDonald’s leaving, restaurants are being rebranded as “Uncle Vanya,” a new company with a logo based on the Golden Arches logo of McDonald’s.
The US government has also been pressing Chinese semiconductor companies are not to supply chips to Russia. While Chinese companies are not directly subject to US law, many Chinese manufacturers rely on Western technologies. The US sanctions against China’s Huawei have done significant damage to the company’s smartphone business.
Last week, the Associated Press reported that many 70,000 Russian technology workers has fled Russia since the invasion of Ukraine began. That departure will make it all the more difficult for the Russian government to find the resources necessary to rebuild its commercial IT infrastructure for government use.
Tim Lee was on staff at Ars from 2017 to 2021. In 2021, he launched Full Stack Economics, an independent email newsletter about economics, technology, and public policy. You can subscribe to our newsletter Here.