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[News] China Reportedly Advises Local Companies to Avoid NVIDIA’s H20, Benefiting Huawei and Cambricon
Rumors have been circulating that NVIDIA has stopped taking orders for its H20 chips customized for China since August. Now, according to the latest report by Bloomberg, regulators in China have been advising companies against buying H20, as part of the country’s strategy to bolster its semiconductor industry and respond to further US sanctions.
As the initiative aims to boost the market share of domestic Chinese AI chip manufacturers, Huawei and Cambricon Technologies, which are leading AI processor makers in China, may turn out to be the major beneficiaries, Bloomberg suggests.
Beijing’s approach has been more of a guideline than a strict prohibition, as the authority still hopes to support its own AI startups, the report notes.
However, it is indicated that in recent months, several Chinese regulators, including the Ministry of Industry and Information Technology, did issue the so-called “window guidance”—informal instructions that lack legal authority—to minimize the use of NVIDIA.
It is worth noting that China has a thriving AI sector amid US restrictions. Major tech player like ByteDance and Alibaba are making significant investments, while numerous startups are vying for dominance. According to an earlier report by The Information, it is rumored that ByteDance has ordered over 200,000 NVIDIA H20 chips this year for AI model training, costing it over USD 2 billion.
In addition, there are six rising stars in the country’s development of large language models, which are crucial for generative AI, including 01.AI, Baichuan, Moonshot, MiniMax, Stepfun, and Zhipu, Bloomberg notes.
According to Bloomberg, some companies are disregarding the Chinese directive to avoid H20 chips, hastily acquiring more before a potential US sanction by the end of the year. However, they are also purchasing domestic Huawei chips to appease Beijing.
As early as in 2022, the US government prohibited NVIDIA from selling its most advanced AI processors to Chinese clients to curb Beijing’s technological progress. In response, the AI chip giant launched a series of AI chips tailored for the Chinese market, including H20, L20 and L2. According to a previous report by Wccftech, H20 GPU has 41% fewer Cores and 28% lower performance versus H100.
NVIDIA declined to comment to Bloomberg’s report, neither did China’s Ministry of Commerce, Ministry of Information and Technology, and Cyberspace Administration respond, Bloomberg notes.
In a separate statement, NVIDIA CEO Jensen Huang noted in an interview with Bloomberg Television that he is focused on serving customers in China while adhering to US government restrictions.
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(Photo credit: NVIDIA)
