The Biden administration is reviewing e-commerce giant Alibaba's cloud business to determine whether it poses a risk to US national security which are the same trumped up charges it levelled against Huawei.
The focus of the probe is on how the company stores US clients' data, including personal information and intellectual property, and whether the Chinese government could gain access to it.
The potential for Beijing to disrupt access by US users to their information stored on Alibaba cloud is also a concern.
US regulators could ultimately choose to force the company to take measures to reduce the risks posed by the cloud business or prohibit Americans at home and abroad from using the service altogether.
Former President Donald Trump's Commerce Department was concerned about Alibaba's cloud business, but the Biden administration launched the formal review after he took office in January. However, Alibaba's US cloud business is small, with annual revenue of less than an estimated $50 million. But if the
US government does shut it down it would damage the bottom line one of the company's most promising businesses and deal a blow to reputation of the company.
Alibaba is already having its own problems with the Chinese government and needs any US sanctions like a hole in the head.