Big Three Cloud Providers Halt New Business in Russia

By Tiffany Trader

March 10, 2022

Add Amazon Web Services to the growing list of companies (tech and otherwise) that are curtailing business with Russia in opposition to President Putin’s invasion of Ukraine. As reported in the New York Times and by Amazon itself, Amazon Web Services is blocking new sign-ups from Russia and Belarus. Existing customers are not impacted.

“We’ve suspended shipment of retail products to customers based in Russia and Belarus, and we will no longer be accepting new Russia and Belarus-based AWS customers and Amazon third-party sellers,” Amazon said in a March 8 statement. “We are also suspending access to Prime Video for customers based in Russia, and we will no longer be taking orders for New World, which is the only video game we sell directly in Russia.”

Further, the e-commerce and web services giant reported that the company has no datacenters, infrastructure or offices in Russia and maintains a long-standing policy of not doing business with the Russian government.

Earlier Amazon had said it is “donating $5 million to organizations that are providing critical support on the ground in the Ukraine and matching up to $5 million in additional donations from employees.”

Rival cloud provider Microsoft had, several days earlier, stated that it was ceasing “all new sales of Microsoft products and services in Russia” and stopping “many aspects” of its business in Russia in alignment with sanctions.

Google Cloud is reporting a similar policy. “We can confirm we are not accepting new Google Cloud customers in Russia at this time. We will continue to closely monitor developments,” the internet giant said in a statement to TechCrunch.

Other tech companies that have suspended business with Russia include Intel, AMD, Nvidia, IBM, HPE, Dell, Microsoft, NetApp, Cisco, SAP, Samsung and Oracle. Chip manufacturer TSMC says it has suspended sales to Russia, and GlobalFoundries said it is complying with U.S.-led sanctions, according to a report in the Washington Post.

The U.S. is leveraging a new export control mechanism – called the foreign direct product rule – that restricts both U.S. and non-U.S. companies from selling computers and other high-end components to Russia if they are made with U.S. technology, software or equipment.

Russia will be hard-hit by the restrictions, as it does not have a strong national semiconductor program and relies on advanced computing technologies from Taiwan, the U.S., Europe, Japan and South Korea.

The main backer of Russia’s indigenous technology program – the state-owned Rostec defense corporation – has been indirectly impacted by new sanctions placed on the Joint Stock Commercial Bank Novikombank (Novikombank), which is wholly owned by Rostec.

Novikombank is one of a number of Russian banks that have been targeted for sanctions by the United States and its allies. A U.S. Department of Treasury notice states that prior to this latest action, “Novikombank was subject to certain debt-related restrictions … but is now blocked.” It continues, “Novikombank’s parent company, Rostec, remains subject to certain debt-related restrictions[.]”

Rostec has been developing HPC systems based on Russia’s Elbrus processors, which were designed by Moscow Center of SPARC Technologies (MCST) and manufactured by TSMC.

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