China’s AI industry has suffered a similar fate to Huawei’s smartphone component supply chain, with manufacturers like Nvidia and AMD barred from selling chips in the region. That’s about to change, according to American officials.
GPU makers Nvidia and AMD will be permitted to resume sales to Chinese customers, on the condition that they share 15% of the revenue generated from these sales with the US government. This is a condition that these companies have agreed to, says an unnamed US official speaking to Reuters.
Nvidia’s sales, China
A spokesman for the world’s most valuable company talked around the revenue-sharing deal that will see the sale of Nvidia’s H2O chipsets in the East resume after being cut off in April this year, saying, “We follow rules the U.S. government sets for our participation in worldwide markets. While we haven’t shipped H20 to China for months, we hope export control rules will let America compete in China and worldwide.”
It’s not all in China’s favour, of course. The relaxation of import controls on AI hardware still puts the country at a disadvantage, as the most advanced products will still not be made available in that region.
Concerns about national security (for the United States) were cited as the original ban. This step back prompted the Center for New American Security’s Geoff Gertz to say, “Either selling H20 chips to China is a national security risk, in which case we shouldn’t be doing it to begin with, or it’s not a national security risk, in which case, why are we putting this extra penalty on the sale?”
It appears that resuming sales of AI hardware in China is part of an ongoing negotiation that sees Chinese use of American tech as somewhat beneficial. It’s also believed that the US is hoping to make a related deal for China-sourced rare-earth metals for that country’s use as part of these negotiations.
AMD’s MI308 chipsets are reportedly also on the list of permitted products to make their way to Chinese data centres. AMD didn’t provide any comment on the deal.
