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Tech war: China advocates use of local AI chips over those from US powerhouse Nvidia

AI chip users on the mainland have been informally advised to prioritise local alternatives, including those from Huawei, sources say

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While there is no official ban on Nvidia’s China-tailored H20 graphics processing unit, sources say mainland AI chip users  are being encouraged to adopt locally made alternatives. Photo: Shutterstock
Che Panin Beijing
Chinese authorities have informally advised local companies to use domestic-made artificial intelligence (AI) chips over those from Nvidia, according to two sources familiar with the matter, as alternative suppliers on the mainland look to catch up with the US tech giant.
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While there is no official ban on Nvidia’s China-tailored H20 graphics processing unit (GPU), the sources said mainland AI chip users have been informed to prioritise deployment of local alternatives, including those developed by Huawei Technologies.

A third source said H20 orders made by mainland enterprises had not been restricted as of August.

Reports about China’s tacit rules against the American chip design firm first emerged in May, when US tech media The Information reported that regulators had asked local companies to cut back purchases of Nvidia chips and buy more from domestic suppliers like Huawei. A Bloomberg report last week said that China has called on local buyers to stay away from Nvidia.

The country’s Ministry of Industry and Information Technology, which oversees the domestic semiconductor and AI sectors, has not made any public announcement regarding that matter. The agency did not reply to a request for comment.
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Nvidia did not also respond to a request for comment on the reported China restrictions.

Nvidia chief executive Jensen Huang presents the company’s advanced Blackwell artificial intelligence platform at an event ahead of the Computex trade show in Taipei, Taiwan, on June 2, 2024. Photo: Reuters
Nvidia chief executive Jensen Huang presents the company’s advanced Blackwell artificial intelligence platform at an event ahead of the Computex trade show in Taipei, Taiwan, on June 2, 2024. Photo: Reuters
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