NVIDIA just scored a massive order from Chinese tech giants. ByteDance, Alibaba, and Tencent together bought H20 server chips worth over $16 billion in the first three months of this year.
These H20 chips are the most powerful AI processing chips that Chinese companies can buy from NVIDIA, thanks to US export controls. The high demand for these chips is driven by the need for affordable AI models.
Reuters reported that H3C, one of China’s largest server makers, is facing a shortage of H20 chips. This could limit China’s progress in AI.
The US government has been restricting the export of advanced chips to China since 2022. The goal is to prevent China from using these chips to develop its military capabilities.
What’s behind the demand for H20 chips?
The demand for H20 chips is largely driven by the growing need for AI models that won’t break the bank. Chinese companies are looking for ways to stay competitive in the AI space without relying on expensive, high-end chips.
Key players involved
Some of the key players involved in this massive order include:
- ByteDance: The company behind TikTok and other popular apps.
- Alibaba: A Chinese e-commerce giant with a growing presence in AI and cloud computing.
- Tencent: A major Chinese tech company with interests in gaming, social media, and AI.
These companies are driving the demand for H20 chips, which will likely play a significant role in shaping the future of AI in China.
Source:
For more information, check out the report from Reuters.