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Senate passes PC export limits

The Senate votes in favor of legislation that limits export of next year's workstation computers and business servers.

The Senate today voted in favor of legislation that contains a provision limiting export of next year's workstation computers and business servers.

The 1998 Defense Department authorization bill, which requires the Commerce Department to license and monitor the export of certain classes of machines, passed the Senate by 90 to 10. It cleared the House last Tuesday, meaning that only a presidential veto would stop the export controls from going into effect.

The Clinton administration has indeed threatened a veto, but mostly for unrelated reasons: It opposes a change in the provision of services to defense bases in California and Texas. The October 28 letter from Office of Management and Budget director Franklin Raines containing the veto threat does specifically mention the administration's objection to the export restriction.

According to a provision originally attached as an amendment by Reps. Floyd Spense (R-South Carolina) and Ron Dellums (D-California), computer makers shipping machines that can perform 2,000 million theoretical operations per second (MTOPS) to some 50 countries--including Russia, China, and India--must apply to the Commerce Department for an export license.

The export provision's potential effect on trade has largely escaped the notice of most lawmakers, who have been more concerned with revelations that supercomputers shipped to Russia and China were appropriated for noncivilian use. "Unfortunately, what really got their attention was some of those sales. That was their initiation to the issue," said a House staff member familiar with the so-called Spense amendment.

The standard may include machines that will reach the general market next year. According to the formula used by the Commerce Department's Bureau of Export Administration, obtained by CNET's NEWS.COM, a computer's MTOP rating can be determined by dividing the number of integer instructions per clock cycle by three, multiplying this figure by the megahertz speed, and then adding the megahertz speed again (to account for floating point instructions). If multiprocessors exist, different MTOP ratings are added together.

An integer instruction is one of the most common instruction types used in computers. For every tick, or clock cycle of the processor, typically up to three of these instructions can be issued.

For a computer with two integer instructions per cycle like the Pentium II, this is the same as multiplying a processor's megahertz by 1.67 and then by the number of processors in a computer. A four-processor workstation using 300-MHz Pentium II processors therefore has a MTOP rating of 2,000 MTOPs (300 times 1.67 times 4). Next year, Pentium IIs will reach clock speeds much faster than 300 MHz and are expected to be strung together in four-processor systems.

Next-generation NT servers from IBM will pass the hurdle and Unix machines from Silicon Graphics, Digital Equipment, and Sun Microsystems already exceed it, said Paul Freedenberg, a Commerce Department undersecretary in the Reagan administration.

Single- and multiple-processor machines using high-end chips from Digital and Sun also fall within the scope of the restrictions.

Leading chipmaker Intel disagrees, however, saying a 300-MHz Pentium II runs at 350 MTOPS. According to a spokesman, PCs equipped with current Intel processors and what are likely next year's chips would not be affected by the provision.

A Commerce Department spokesperson also suggested that desktop-class machines were unlikely to top the 2,000 mark.

Dean McCarron, an analyst with Mercury Research, pointed out that confusion stems from the fact that MTOP is not a typical industry standard. Although a Commerce spokesperson asserted the formula has been around since the Cold War, McCarron indicated that the formula currently used by the Commerce Department is more complex than those used in the past. In fact, when asked to calculate MTOPs, no analyst used the formula provided by the Commerce Department until it was provided to them.

In any event, McCarron termed the regulation ineffectual because "Tier 3" countries could string together a number of Pentium II desktops and achieve massive MTOP performance.

The 2,000-MTOP standard was adopted in October 1995, following a government study that included Pentagon input on military use of high-performance computers. A study looking into revising the standard, one of several export control parameters, is currently under way at Stanford University, according to various sources. It's expected to wind up by the end of the year.

The defense bill changes the U.S. export control regime by rolling back trade liberalization effected by the Clinton administration in 1995. Under the current regime, PC makers and resellers can export without a license to Tier 3 countries machines capable of more than 2,000 MTOPs but less than 7,000 MTOPs, provided the machines are intended for nonmilitary, nonweapons research use. The exporters are not required to investigate the machines' end uses but cannot ignore red flags that suggest the machines would be misappropriated for military ends.

In the future, vendors would submit export notifications to the Commerce Department identifying the country of destination and the end user. The Department would then circulate the petition to a number of agencies, including the Pentagon. If the federal government fails to act within ten days, the vendor can export the computers without restrictions.

If an objection arises, the Commerce Department can then demand a license or export, which can take up to 90 days to obtain, according to Jason Mahler, legislative assistant for Rep. Zoe Lofgren (D-California). The license can also be denied. Further, the bill requires the Commerce Department to perform compliance verification.

"In many ways the [Spense amendment] is a vote of no confidence in the export control regime," said Jay Kraemer, who practices trade law at Fried, Frank, Harris, Shriver & Jacobson in Washington and teaches at the Georgetown University Law School. "It's an unfortunate example of micromanaging the export control process."