Export rules could ban some PCs
The House passes a bill that authorizes federal departments to prevent free export of desktop-class computers.
The provision is included in a little-known amendment to the House's fiscal 1998 defense authorization bill, which is scheduled for a full floor vote today. Although PC makers could still apply for export licenses under the law, they would face a bureaucratic thicket not unlike that encountered by encryption software manufacturers.
Under the law as now written, computer makers shipping machines that can perform 2,000 million theoretical operations per second (MTOPS) or more to certain developing nations have to apply to the Commerce Department for an export license.
Although the performance may sound astronomical, Rep. Zoe Lofgren (D-California) has discovered that this will be the normal operating standard of soon-to-come high-end desktops. Current 300-MHz Pentium II computers can perform at 1,000 MTOPS, estimated Nathan Brookwood, semiconductor analyst at Dataquest. Next year, a machine with the 450-MHz version of the Intel processor will likely exceed 2,000 MTOPS, he said. Chips from other manufacturers would also be impacted.
"It's a bipartisan mistake," Lofgren said of the bill's export provision. "I just found about this Thursday."
Brookwood agreed that the level stipulated by the provision is relatively low and could have market repercussions. "The number sounds too close to the mainstream," he said alluding to the fact that in the near future this will constitute a typical high-end desktop PC.
The American Electronics Association agreed, stating that the next generation of desktops will fall within the ambit of the definition.
Intel, for its part, gives a far lower estimate of the Pentium II's MTOPS. According to a Manny Vara, an Intel spokesman, a 300-MHz Pentium II runs at 350 MTOPS, while the next generation of Pentium IIs will not exceed 2,000 MTOPS. This figure would put the Pentium II below the MTOP performance of processors from other manufacturers.
Lofgren explained that about the only way to stop the provision from becoming law at this point would be a presidential veto, because the sprawling piece of legislation has already been approved in substance by the House and Senate. Lofgren's office is currently sending messages to Silicon Valley figures with Washington connections, including venture capitalist John Doerr of Kleiner Perkins Caufield & Byers, to seek their support defeating the provision.
The export provision was formulated in reaction to revelations earlier this year that Sun Microsystems and Silicon Graphics, among others, inadvertently shipped powerful "supercomputers" to developing nuclear powers. The provision was added to an early version of the defense authorization bill, which passed the House in June with an overwhelming majority.
A version of the bill that did not contain the export provision passed the Senate in July. The current version resulted from a routine House-Senate conference to reconcile the two Defense bills. It was released late last week.
The export provision, authored by Rep. Ron Dellums (D-California) and Floyd Spense (R-South Carolina), would require computer vendors to seek federal approval before exporting machines capable of 2,000 MTOPS to "Computer Tier 3" countries, namely non-NATO countries such as Russia, China, India, Pakistan. Nonaligned nations with nuclear capabilities are permanent members of the list.
Vendors would submit export applications to the Commerce Department identifying the country of destination and ultimate end user. The Department would then circulate the petition to a number of agencies, including the Defense Department. 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 for export, which can take up to 90 days to obtain, according to Jason Mahler, Lofgren's legislative assistant. The license can also be denied. Further, the bill requires the Commerce Department to perform compliance verification.
Currently, computer vendors do not have to apply for export licenses for computers performing at 7,000 MTOPS. Supercomputers recently discovered to have been shipped to Russia in an apparent violation of export restrictions are capable of 10 billion calculations per second. (See related story)
"2,000 MTOPS as far as I can fathom was pulled out of a hat," Lofgren said. The Clinton administration is opposed to the restriction, Lofgren added.
Along with PCs that will use next year's high end Pentium II chips, other technology that would likely fall into this category are servers and workstations using the Ultrasparc III processor from Sun Microsystems, Digital Equipment's 21264 Alpha chip, and computers using second-generation Power 3 chips from IBM.
And, while ambiguous, the bill could also conceivably apply to two- and four-processor machines. This would include a wide variety of servers and workstations.