Chinese IT companies, Already Secured Large Quantities Of Nvidia AI H20...Preparing For US Regulations
Tensions between the U.S. and China surrounding NVIDIA AI chips (Source: Reuters)
It has been revealed that China's leading tech companies secured a large quantity of NVIDIA's Artificial Intelligence (AI) chip 'H20' ahead of U.S. export regulations. Alibaba, ByteDance, Tencent, etc., pre-ordered and stocked H20 worth trillions of won, and some have already been brought into China.
Nihon Keizai Shimbun and Nikkei Asia reported on the 23rd that these companies have been proactively responding since last year anticipating U.S. export control measures. The amount of H20 requested from NVIDIA amounts to a maximum of 12 billion dollars (approximately 17 trillion won), and it has been determined that chips worth several billion dollars have already entered China before the export ban was issued.
H20 is an AI chip made by NVIDIA targeting the Chinese market, designed with a structure suitable for supercomputers in terms of connectivity and memory, although its performance is lower than the existing high-performance chip H100. While it had been possible to distribute within the U.S. government's export control limits, the Trump administration activated a measure prohibiting exports to China without prior authorization for H20 this month.
Due to this measure, NVIDIA is projected to incur revenue losses of approximately 5.5 billion dollars (7.5 trillion won), and concerns arise within the industry that Chinese companies failing to secure H20 may struggle to obtain alternative chips.
Meanwhile, NVIDIA stated that it received a prior approval obligation notice from the U.S. government for H20 exports on the 9th, and on the 14th, was informed that the measure would continue indefinitely. The U.S. government cited the potential use of H20 for supercomputing and military purposes as the basis for export restrictions.
As the demand for AI calculation explodes amid the rapid growth of the AI industry in China, the industry is focused on the potential impact of U.S. technical export restrictions to China.