China inserted surveillance microchips in servers used by Amazon, Apple, report says

NEW YORK: Apple Inc and Amazon.com Inc denied a Bloomberg report on Thursday that their systems had been infiltrated by malicious computer chips inserted by Chinese intelligence, according to statements from the companies released by Bloomberg.

The report cited 17 intelligence and corporate sources, who claimed that Chinese spies had also inserted chips inside equipment used by multiple United States government agencies, which could potentially give Beijing access to internal servers.

The report also quoted denial of the reporting by Amazon Web Services, a cloud-services subsidiary of Amazon, which in 2015 acquired a company, Elemental, whose servers reportedly were affected by the Chinese operation. AWS subjected the company to a security audit, which raised flags in the servers that Elemental customers needed to install on their networks to handle the video compression software.

Elemental Technologies had national security contracts and servers similar to the one that Amazon tested were in data centers belonging to the Department of Justice, on Navy warships, and in systems used to control Central Intelligence Agency drones, according to the Bloomberg report.

According to the report, Apple also bought a number of servers from Supermicro, a Bay Area-based server company, around the same time. Upon the discovery, Amazon reportedly alerted USA authorities, which sent "a shudder through the intelligence community", Bloomberg wrote.

At no time, past or present, have we ever found any issues relating to modified hardware or malicious chips in SuperMicro motherboards in any Elemental or Amazon systems.

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Beyond an infected driver discovered in 2016 on a single Supermicro server found in Apple Labs, Apple says that such claims are "inaccurate". "That one-time event was determined to be accidental and not a targeted attack against Apple", the company wrote.

However, Bloomberg's sources are adamant.

"While we would cooperate with any government investigation, we are not aware of any investigation regarding this topic nor have we been contacted by any government agency in this regard", Super Micro's statement said. Its technology had helped stream the Olympic Games online, communicate with the International Space Station, and funnel drone footage to the Central Intelligence Agency.

Check out the full story and see the statements from the named companies here. Gray or off-white in color, they looked more like signal conditioning couplers, another common motherboard component, than microchips, and so they were unlikely to be detectable without specialized equipment. This level of hardware hacking would be borderline unprecedented in scope, and Bloomberg claims the FBI opened an investigation (after the incident was reported by Apple) that's still in progress three years later. It's also untrue that AWS knew about servers containing malicious chips or modifications in data centers based in China, or that AWS worked with the FBI to investigate or provide data about malicious hardware.

Amazon, Apple, and Supermicro strongly disputed the findings. A spokesperson said: "China is a resolute defender of cybersecurity".