NVIDIA and AMD are reportedly launching new, compliant AI chips for China. Explore what this means for the global AI landscape and ongoing tech tensions.
The world of artificial intelligence is constantly buzzing, and the latest news has major players NVIDIA and AMD reportedly gearing up to launch new AI chips specifically designed for the Chinese market. This move comes as both companies navigate complex U.S. export restrictions aimed at limiting China’s access to advanced semiconductor technology.
The “Why”: Navigating Export Controls
The U.S. government has implemented several rounds of export controls on advanced AI chips to China, citing national security concerns. These restrictions have significantly impacted companies like NVIDIA, which saw its market share in China drop from around 95% before 2022 to about 50% currently. NVIDIA’s CEO, Jensen Huang, has even stated that these controls have effectively “closed” a market he values at roughly USD 50 billion to U.S. industry.
In response, both NVIDIA and AMD are reportedly developing new chips with modified specifications to comply with these regulations, allowing them to continue serving the substantial Chinese market.
What’s Cooking? New Chips on the Horizon
NVIDIA’s Strategy: NVIDIA is reportedly working on a new, lower-priced AI chipset for China based on its latest Blackwell architecture. This chip is expected to be priced between USD 6,500 and USD 8,000, significantly less than its previously restricted H20 model, which sold for USD 10,000-USD 12,000. Mass production for one such chip could begin as early as June 2025.
This new chip will reportedly use conventional GDDR7 memory instead of more advanced High Bandwidth Memory (HBM) and will not require TSMC’s advanced CoWoS packaging, reflecting its adjusted specifications to meet export rules. Some sources suggest this chip might be called the 6000D or B40. Another Blackwell-architecture chip for China is also reportedly in development, with production potentially starting in September.
AMD’s Approach: AMD is also reportedly preparing China-specific AI chips. One such offering is expected to be a cut-down version of its Radeon AI PRO R9700 workstation GPU, based on the RDNA4 architecture. AMD seems to be focusing on its “Radeon PRO” workstation GPUs for the Chinese AI market, ensuring compliance with U.S. regulations while offering an alternative to NVIDIA’s products. Reports suggest these new chips from both NVIDIA (codenamed B20 for one variant) and AMD (Radeon AI PRO R9700) could start selling in China as early as July and are designed to support large language models like those from Chinese AI startup DeepSeek.
The “So What”: Implications for the AI Industry
These developments have several significant implications:
- Market Access vs. National Security: This situation highlights the ongoing tension between U.S. efforts to restrict China’s access to cutting-edge technology for national security reasons and the desire of U.S. companies to access the lucrative Chinese market. NVIDIA, for example, incurred a USD 4.5 billion charge in Q1 due to licensing requirements impacting its H20 AI chip sales to China.
- Fueling China’s AI Ambitions?: While the new chips will be less powerful than their unrestricted counterparts, they will still provide significant AI processing capabilities to Chinese companies. This could, in a way, continue to fuel China’s AI development, albeit with modified hardware.
- Rise of Domestic Competition: U.S. export controls have inadvertently spurred the growth of Chinese domestic chip designers like Huawei, whose Ascend 910B chip is a key competitor to NVIDIA in China. NVIDIA’s CEO has warned that if U.S. export curbs continue, more Chinese customers will turn to local alternatives.
- Innovation Under Constraints: The need to design compliant yet competitive chips could drive innovation in chip design and optimization, focusing on maximizing performance within specific limitations. This has been likened to a “DeepSeek moment” for NVIDIA, referencing how Chinese AI firms have thrived by adapting under constraints.
- Pricing Pressure: The introduction of lower-cost, region-specific AI chips could intensify pricing pressure across the AI hardware market, potentially impacting premium offerings and prompting rivals to adjust their pricing strategies.
A Balancing Act with Global Ripples
The moves by NVIDIA and AMD to introduce China-specific AI chips represent a complex balancing act. They are striving to maintain a foothold in a critical market while adhering to evolving geopolitical and regulatory landscapes. The success of these new chips will depend on their performance relative to both unrestricted international chips and increasingly capable domestic Chinese alternatives.
This ongoing saga underscores the intricate interplay between technology, commerce, and international relations in the age of AI. It’s a space where innovation is rapid, competition is fierce, and the rules of the game can change quickly.
Key Takeaways:
- NVIDIA and AMD are reportedly developing new AI chips specifically for the Chinese market to comply with U.S. export restrictions.
- NVIDIA’s new Blackwell-based chip for China is expected to be significantly cheaper than its previous restricted models.
- AMD is also preparing compliant chips, potentially based on its Radeon AI PRO R9700 workstation GPU.
- These moves aim to retain access to the large Chinese AI market despite U.S. controls.
- The situation highlights the tension between national security concerns, market access, and the rise of domestic Chinese AI chip competitors.
The AI chip landscape is more dynamic than ever. What are your thoughts on NVIDIA and AMD’s strategy for the Chinese market? Let us know in the comments below, and keep following “24 AI News” for the latest developments!
