Nvidia creates pared back AI chip H100 for export to China

Recently, Nvidia Corp, an American GPU and system-on-a-chip tech company, announced that it will be producing a new version of its H100 chip for export to China.

Last year, the US enacted rules preventing Nvidia from selling two of its most advanced chips, the A100 and the newer H100, to Chinese customers, based on national security concerns. Such chips play a leading role in the development of AI technologies such as OpenAI’s ChatGPT and similar products.

However, Nvidia came up with a clever but rather profitable way to leave China dependent on US-made hardware and not suffer losses due to supply cuts within export restrictions imposed by the US government.

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To do this, the company kept the performance of the H800 chip the same as the H100 but halved the data bandwidth, which will knock China out of competition in the field of AI and leave the country dependent on supplies from the United States for at least 5 years or more until China will not be able to manufacture its own AI chips that compete with Nvidia chips.

The H800 chip will now power China’s largest AI projects led by Alibaba, Baidu, and Tencent. China, of course, has another option – to appropriate the manufacturer of these chips, Taiwan Semiconductor Manufacturing Co. encroaching on Taiwan as a whole, or simply privatizing production. Let’s see what step China will take in the framework of the war for the status of a technological leader.