NVIDIA is facing significant concerns regarding its access to the expansive artificial intelligence market in China. Reports from The Wall Street Journal and Reuters indicate that the company is proactively developing three novel AI chips tailored specifically for the Chinese market, ensuring compliance with the latest US export restrictions. The apprehension stems from worries that these chips could be repurposed for military applications, prompting a cautionary advisory from the US government to tech companies last year regarding the potential limitations on exporting computer chips designated for mainframes and AI implementations to China and Russia. Consequently, NVIDIA encountered restrictions in selling certain A100 and H100 cards within the country, leading to the introduction of the A800 and M800 chips catered to the Chinese market.
Recently, the US government has imposed further constraints on the computational capabilities permissible for devices intended for export to these regions. As a result, products like the A800, H800, and even NVIDIA’s flagship RTX 4090 consumer GPU are no longer eligible for export. Speculations suggest that NVIDIA might face cancellations of orders exceeding $5 billion for advanced chips in China.
The newly tailored cards for the Chinese market, identified as the HGX H20, L20, and L2, adhere to the processing power limitations outlined in the updated US import regulations. While the H20 is considered the most robust among the trio, users employing them for AI applications may necessitate a higher quantity of cards compared to utilizing higher-spec models.
In anticipation of potential challenges in sourcing chips from the US and other countries, Chinese tech giants such as Baidu, Huawei, Xiaomi, and Oppo have initiated the development of indigenous semiconductors. Despite this trend, established NVIDIA clients may opt to retain loyalty due to the company’s reputable hardware and software, acknowledged as among the most potent for AI development by The Journal. As per sources, NVIDIA is expected to unveil the new chips on November 16, with plans to commence sales before the year concludes.
