US turns the spotlight on Chinese TP-Link, and Netgear's share price soars

In the already difficult relationship between the United States and China, which has led to reciprocal trade ban, there is also the story of TP-Link, one of the world's most famous modem-router companies. The American authorities, in fact, are considering a possible ban on routers produced by the Chinese company, which in the meantime holds 65% of the market in the United States (data referring to homes and small businesses), The reason? Growing national security concerns and TP-Link's alleged involvement in cyber attacks attributed to Chinese hacking entities.

A recent Microsoft report revealed that compromised TP-Link devices have been used in ransomware operations, fuelling concerns about the company's role in facilitating malware.

Being a Chinese company, the suspicions are those already known from other similar stories: links to the Beijing government and, potentially, cyber-espionage operations. These allegations are based on reports linking the use of TP-Link devices as access points for hackers affiliated with Chinese groups. These groups allegedly exploited vulnerabilities in routers to conduct cyber attacks against critical US infrastructure and corporate networks.

In addition to IT security issues, the Justice Department is investigating TP-Link's pricing strategies. Basically, Washington wants to understand whether the company's practice of selling routers below production costs violates US antitrust laws.

This investigation highlights the increasing scrutiny of Chinese technology companies operating in critical sectors of the US market, and is part of a broader context of technology and trade tensions between the US and China. Previously, other Chinese technology companies such as Huawei and ZTE have been subject to similar restrictions and bans. Notably, Huawei was banned from the US market on charges of espionage and 5G network security risk.