China prohibits its major tech corporations from purchasing Nvidia chips, according to a report, with Beijing asserting that its domestic AI processors now rival H20 and RTX Pro 6000D.
In a significant turn of events, the Cyberspace Administration of China (CAC) has imposed a ban on Nvidia's AI chips, affecting several tech companies, including ByteDance and Alibaba. This decision comes as Chinese industry leaders strive to break free from American technology and boost their homegrown semiconductor industry.
The ban, which includes Nvidia's Blackwell-based B30 chips that perform up to 80% of its latest products, has left export approvals up in the air. The CAC has also ordered companies to stop testing the new RTX Pro 6000D and cancel their orders for these GPUs.
The focus in China is now on building a domestic system, implying efforts to reduce dependence on foreign technology. Chinese tech giants like Tencent are pushing to build their own infrastructure to replace Nvidia's software stack. Companies such as Alibaba, MetaX (Shanghai), Cambricon Technologies (Beijing), and Huawei Technologies are among those currently building their own infrastructures to replace Nvidia's offerings.
Huawei notably develops its Ascend AI chips, aiming to reduce dependence on US providers and compete with Nvidia's offerings by developing local AI chips and related software ecosystems. Beijing believes that homegrown AI chip makers, like Huawei and Cambricon, now produce chips that have comparable performance to Nvidia's China-only products.
The ban could potentially accelerate the growth and development of China's homegrown semiconductor industry. It could also lead to increased investment and resources in this sector, as the message is now clear: all hands are on deck to build the domestic system.
Nvidia's CEO, Jensen Huang, expressed disappointment about the ban but understands the larger agendas between China and the US. He hopes to discuss Nvidia's ability to do business in China with President Trump during his state visit to the UK.
Some believe that Beijing is making these moves to get a more favorable deal from the U.S. in trade negotiations. However, the executive's statement suggests a shift in strategy within the Chinese tech industry, prioritizing domestic production over foreign supply.
Earlier, there were hopes that renewed Nvidia supply would occur if the geopolitical situation improved, but this belief is no longer held. The executive's comments also imply that the Chinese tech industry is not waiting for geopolitical improvements to improve their supply situation.
As China's chip makers ramp up production in anticipation of the glut of orders coming from companies that need AI chips but can't purchase Nvidia products, the race to self-sufficiency in semiconductor technology is well underway.
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