Nvidia Said To Launch New AI Chip For China

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Besides, it said the US may consider extending its export controls on chips sold to other Asian countries, such as Malaysia, Indonesia, and Thailand – or extending the controls to overseas Chinese companies, although these would be harder to implement.

The report came after the Wall Street Journal on July 2 exposed an underground network that is smuggling A100, which has been banned for sale to China since October 2022, to mainland China.

According to the report, some middlemen set up research institute centers in Southeast Asian countries such as Singapore to purchase A100 chips from the US. They pay overseas Chinese students to bring these chips to China when they return home for vacation.

In one case, a 26-year-old Chinese student successfully brought six A100 chips in his luggage to China and made US$100 for each of them.

The official selling price of A100 is about $10,000 while the chip is priced at about $22,500 in the gray market in China. Buyers of smuggled chips cannot use Nvidia's warranty or maintenance services.

'Castrated version'

In October 2022, the US Commerce Department's Bureau of Industry and Security (BIS) banned the exports of the A100 and H100 chips to China. Last October, it blocked the shipments of the A800 and H200 and some other AI chips to China.

Nvidia then launched three AI chips, including the H20, L20 and L2, for the China market.

The single-chip performance of the H20, dubbed as the“castrated version” of H100, is about 15% that of the H100. But the product still sees strong demand from Alibaba, Tencent, Baidu and ByteDance.

The Financial Times estimated that Nvidia's sales of H20 chips in China may reach one million units, or US$12 billion in value, this year.

Cailianpress, a Shanghai-based financial news website, said the first batch of H20 arrived in China in May and June while major Chinese technology firms are now testing them.

The website said Nvidia's Compute Unified Device Architecture (CUDA) platform, which can expand the capabilities of graphic processing unit (GPU) acceleration, is so powerful that many Chinese users cannot resist.

Li Yali, a columnist of Guancha, on Monday published an article with the title“Will Nvidia's H20 be banned from being shipped to China?”

She says in the article that the H20 has an advantage in AI training and reasoning as its high-band-width (HBM) capacity is higher than that of the H100 and China-made AI chips.