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In a global trading environment, sanctions regimes are an added cost to procurement you impose on adversaries, not an impenetrable denial of materials. Huawei

In a global trading environment, sanctions regimes are an added cost to procurement you impose on adversaries, not an impenetrable denial of materials. Huawei can't cost compete if it has to smuggle chips constantly.

JumpCrisscross 2y ago
> Huawei can't cost compete if it has to smuggle chips constantly It also trashes their R&D. Imagine if every LLM researcher in America had to smuggle in Iranian cores to do any work. One of the saddest stories of the 21st century is China’s decline into despotism. They didn’t have democracy, but they had internal political competition and a peaceful transfer of power. In an alternate world, Xi is comfortably retired while China and America drive a new century of human prosperity.
- eunos 2y ago
  > Xi is comfortably retired while China and America drive a new century of human prosperity They told the same during the Hu era and they will write the same to Xi successor. The enmity is structural.
- roenxi 2y ago
  That sounds like it'd be something of a non-issue. If a GPU researcher wants a GPU someone will be willing to smuggle it out for them. Like GP says, a sanctions wall is penetrable. The problem would be more that leading researchers at something like China's OpenAI can't procure a billion dollars worth of GPUs for industrial research. Although I do want to endorse the idea that their political system is probably going to undermine the successes of their businesses. From the outside it looks like a disaster waiting to happen.
  - justahuman74 2y ago
    The smuggling increases costs though. They may have only so much budget - perhaps the sanctioned-country researcher could only afford an H100 now instead of an H200 if you had excluded the smuggling > their political system is probably going to undermine the successes of their businesses I do agree with this
- russli1993 2y ago
  lol, china is doing good in keeping up with llm development, Huawei is happily building AI processors in Chinese fabs and selling them equal the price as Nvidia chips. Huawei profits exploded this year, I wonder why. This article is a joke. US should sanction tsmc as it's caught breaking sanction. Chinese semi tools company revenue is exploding. We will see in 10 years. Also China is driving human prosperity. 1.4b people live in healthy lives, life expectancy is higher than US, a farmer's kid can grow up and working on 5G technology, funny is the US that stops and punish a Chinese person work on 5G, AI, EVs. What happened to freedom of pursuit of happiness and everyone is equal? On the economy, people say China doesn't bring prosperity, China bad, then tell Apple, Tesla to not sell in China, phone up Elon and Tim. US starts trade war, banning Chinese industries, weaponize supply chain, exchanges, collaboration in attempt to destroy Chinese economy, cause 1.4B to go back to proverty. What is US' aim here? Make 1.4b ppl suffer so they will listen to US's demands? To prove a political point? Please tell me is there any Chinese person US haven't attacked? US only loves Chinese if they are dissidents because they help the US destroy China from within. Chinese person just make up a story China government did something bad to me and they get an invitation to Congress. And Congress has stopped even pretending they care to help these Chinese anymore, they use this to justify more attacks on Chinese people and make more Chinese people suffer. US government: yes we care about Chinese ppl and that's why we ban all of their products, destroy all their labor, now these Chinese are jobless can't afford food on the table, what? The supposed solution to lack of freedom is more bans and oppression. We can build a prosperous, mutually respected, win-win world today, no conflict, no attacks, no suffering, if US allows it to be. You are attacking people, and you can stop. Did we steal 5G, did we steal EV batteries? Last I heard Huawei is paying billions to Qualcomm for 5G patent licenses, dispute can be negotiated with good faith and mutual respect. But it doesn't work if one party just to demonize you and want you dead so he can be only kid in the block. China does want to buy US goods, but the one we want to buy you don't sell. We are happy to pay 10k for Nvidia chips but you stopped selling not us. World is large enough for US and China to both succeed.
  - butterlettuce 2y ago
    @dang
- hackernewds 2y ago
  They're not smuggling the cores for usage. They're smuggling to reverse engineer, and the Chinese are much better (even if more willing) at it than Americans. You are also discounting that China has driven a new century of human prosperity for their country and globally through highly efficient manufacturing that has proven tough to replicate.
  - CorrectHorseBat 2y ago
    Not in this case, the chips were detected in Huawei products
  - nradov 2y ago
    Reverse engineering is the easy part. China still lacks EUV lithography manufacturing technology. They'll figure it out eventually but the point is to stay a generation ahead. Just like China can manufacture turbine engines but only ones equivalent to what we had some years ago.
    - datadeft 2y ago
      I think China does not need cutting edge of everything to be successful. If they build a nuclear power plant that has turbines from 5 years ago they are still going to be ok. The question what kind of power plant to build is much more important.
  - jumping_frog 2y ago
    A company probably needs a couple of 100s chips to reverse engineer. Not much.
  - 15155 2y ago
    How many IC samples are required to do a layer-by-layer reverse engineering of something at single-nm feature sizes? Ok, now you've got "something" here even resembling a netlist (lol), what do you do with it? Keep in mind: you don't actually have the manufacturing technology to use this IP. By the time you do, the IC you reversed is no longer state of the art. I think state-sponsored corporate espionage would be a lot more fruitful and cheaper.
- throwaway2037 2y ago
  > China’s decline into despotism I am confused. What were they before?
  - labster 2y ago
    China was a one-party state where party elections actually mattered.
    - gpvos 2y ago
      Free speech on political topics was still limited, e.g. about Tiananmen Square.
      - JumpCrisscross 2y ago
        Not among the elites, to my knowledge. Within the Chinese oligarchy there was political competition. Compare it to American democracy when we excluded women, Blacks and Indians.
        gpvos 2y ago
        That's little consolation for the common man.
  - Longlius 2y ago
    They had a lot of problems but power was still highly decentralized (a lot of decisions were left to local and regional party bosses). Human rights were never especially high on the list of priorities but you tended to see the government allow for a degree of experimentation that produced a lot of innovation and led to a vibrant culture. Things are very different now with a one-man cult of personality.
- hilux 2y ago
  In the 21st century, China's per capita GDP has grown about 2.5x as much as that of democratic India, which is also the only other country of comparable population.
  - edouard-harris 2y ago
    True, but the overwhelming majority of that growth in percentage terms occurred prior to their recent decline into despotism. Xi didn't take power until 2013, and it took him several years to fully consolidate. See, e.g., https://www.macrotrends.net/global-metrics/countries/CHN/china/gdp-per-capita https://www.macrotrends.net/global-metrics/countries/CHN/chi...
  - fennecbutt 2y ago
    But GDP from doing what, is the real answer.
- aurareturn 2y ago
  >One of the saddest stories of the 21st century is China’s decline into despotism. They didn’t have democracy, but they had internal political competition and a peaceful transfer of power. In an alternate world, Xi is comfortably retired while China and America drive a new century of human prosperity. I think the US and the west would be doing the exact same things to China regardless of what happened with Xi. When China decided to design phones instead of manufacturing them for American companies, that's when their fate was sealed and the west (and Japan) took action. China wanted to move up the value chain. The west wanted China to remain as their factory. The "China bad" propaganda is just to convince western commoners that doing these things to China is justified. It's about economics and power. Always is. Always has been.
  - kasey_junk 2y ago
    That didn’t happen when Japan or Korea moved up the value chain.
    - aurareturn 2y ago
      It did happen for Japan. >“When governments permit counterfeiting or copying of American products, it is stealing our future, and it is no longer free trade.” So said US President Ronald Reagan, commenting on Japan after the Plaza Accord was concluded in September 1985. But Japan and Korea weren't/aren't nearly the threat of China due to size.
- fxtentacle 2y ago
  You should probably read about the "century of humiliation" to understand why dominance through strength is being seen as something very positive in modern China.
  - Paradigma11 2y ago
    Understand, sure. Care, no. All nations and ethnicities have tons of grievances in their closet. That is how you get centuries of warfare and jingoism. China had a good thing going, they decided to change for this aggressive path.
    - Kstarek 2y ago
      [flagged]
- huijzer 2y ago
  You could say the same for Russia. But on the other hand, maybe they were despots all along?
mppm 2y ago
I will add that costs are imposed not only on adversaries, but on everyone. Between reporting requirements, economic sanctions, anti-money-laundering and anti-tax-evasion provisions, perfectly legitimate businesses are probably losing close to a trillion dollars a year on compliance and lost opportunities.

JumpCrisscross 2y ago

> Huawei can't cost compete if it has to smuggle chips constantly It also trashes their R&D. Imagine if every LLM researcher in America had to smuggle in Iranian cores to do any work. One of the saddest stories of the 21st century is China’s decline into despotism. They didn’t have democracy, but they had internal political competition and a peaceful transfer of power. In an alternate world, Xi is comfortably retired while China and America drive a new century of human prosperity.

eunos 2y ago
> Xi is comfortably retired while China and America drive a new century of human prosperity They told the same during the Hu era and they will write the same to Xi successor. The enmity is structural.
roenxi 2y ago
That sounds like it'd be something of a non-issue. If a GPU researcher wants a GPU someone will be willing to smuggle it out for them. Like GP says, a sanctions wall is penetrable. The problem would be more that leading researchers at something like China's OpenAI can't procure a billion dollars worth of GPUs for industrial research. Although I do want to endorse the idea that their political system is probably going to undermine the successes of their businesses. From the outside it looks like a disaster waiting to happen.
- justahuman74 2y ago
  The smuggling increases costs though. They may have only so much budget - perhaps the sanctioned-country researcher could only afford an H100 now instead of an H200 if you had excluded the smuggling > their political system is probably going to undermine the successes of their businesses I do agree with this
russli1993 2y ago
lol, china is doing good in keeping up with llm development, Huawei is happily building AI processors in Chinese fabs and selling them equal the price as Nvidia chips. Huawei profits exploded this year, I wonder why. This article is a joke. US should sanction tsmc as it's caught breaking sanction. Chinese semi tools company revenue is exploding. We will see in 10 years. Also China is driving human prosperity. 1.4b people live in healthy lives, life expectancy is higher than US, a farmer's kid can grow up and working on 5G technology, funny is the US that stops and punish a Chinese person work on 5G, AI, EVs. What happened to freedom of pursuit of happiness and everyone is equal? On the economy, people say China doesn't bring prosperity, China bad, then tell Apple, Tesla to not sell in China, phone up Elon and Tim. US starts trade war, banning Chinese industries, weaponize supply chain, exchanges, collaboration in attempt to destroy Chinese economy, cause 1.4B to go back to proverty. What is US' aim here? Make 1.4b ppl suffer so they will listen to US's demands? To prove a political point? Please tell me is there any Chinese person US haven't attacked? US only loves Chinese if they are dissidents because they help the US destroy China from within. Chinese person just make up a story China government did something bad to me and they get an invitation to Congress. And Congress has stopped even pretending they care to help these Chinese anymore, they use this to justify more attacks on Chinese people and make more Chinese people suffer. US government: yes we care about Chinese ppl and that's why we ban all of their products, destroy all their labor, now these Chinese are jobless can't afford food on the table, what? The supposed solution to lack of freedom is more bans and oppression. We can build a prosperous, mutually respected, win-win world today, no conflict, no attacks, no suffering, if US allows it to be. You are attacking people, and you can stop. Did we steal 5G, did we steal EV batteries? Last I heard Huawei is paying billions to Qualcomm for 5G patent licenses, dispute can be negotiated with good faith and mutual respect. But it doesn't work if one party just to demonize you and want you dead so he can be only kid in the block. China does want to buy US goods, but the one we want to buy you don't sell. We are happy to pay 10k for Nvidia chips but you stopped selling not us. World is large enough for US and China to both succeed.
- butterlettuce 2y ago
  @dang
hackernewds 2y ago
They're not smuggling the cores for usage. They're smuggling to reverse engineer, and the Chinese are much better (even if more willing) at it than Americans. You are also discounting that China has driven a new century of human prosperity for their country and globally through highly efficient manufacturing that has proven tough to replicate.
- CorrectHorseBat 2y ago
  Not in this case, the chips were detected in Huawei products
- nradov 2y ago
  Reverse engineering is the easy part. China still lacks EUV lithography manufacturing technology. They'll figure it out eventually but the point is to stay a generation ahead. Just like China can manufacture turbine engines but only ones equivalent to what we had some years ago.
  - datadeft 2y ago
    I think China does not need cutting edge of everything to be successful. If they build a nuclear power plant that has turbines from 5 years ago they are still going to be ok. The question what kind of power plant to build is much more important.
- jumping_frog 2y ago
  A company probably needs a couple of 100s chips to reverse engineer. Not much.
- 15155 2y ago
  How many IC samples are required to do a layer-by-layer reverse engineering of something at single-nm feature sizes? Ok, now you've got "something" here even resembling a netlist (lol), what do you do with it? Keep in mind: you don't actually have the manufacturing technology to use this IP. By the time you do, the IC you reversed is no longer state of the art. I think state-sponsored corporate espionage would be a lot more fruitful and cheaper.
throwaway2037 2y ago
> China’s decline into despotism I am confused. What were they before?
- labster 2y ago
  China was a one-party state where party elections actually mattered.
  - gpvos 2y ago
    Free speech on political topics was still limited, e.g. about Tiananmen Square.
    - JumpCrisscross 2y ago
      Not among the elites, to my knowledge. Within the Chinese oligarchy there was political competition. Compare it to American democracy when we excluded women, Blacks and Indians.
      - gpvos 2y ago
        That's little consolation for the common man.
- Longlius 2y ago
  They had a lot of problems but power was still highly decentralized (a lot of decisions were left to local and regional party bosses). Human rights were never especially high on the list of priorities but you tended to see the government allow for a degree of experimentation that produced a lot of innovation and led to a vibrant culture. Things are very different now with a one-man cult of personality.
hilux 2y ago
In the 21st century, China's per capita GDP has grown about 2.5x as much as that of democratic India, which is also the only other country of comparable population.
- edouard-harris 2y ago
  True, but the overwhelming majority of that growth in percentage terms occurred prior to their recent decline into despotism. Xi didn't take power until 2013, and it took him several years to fully consolidate. See, e.g., https://www.macrotrends.net/global-metrics/countries/CHN/china/gdp-per-capita https://www.macrotrends.net/global-metrics/countries/CHN/chi...
- fennecbutt 2y ago
  But GDP from doing what, is the real answer.
aurareturn 2y ago
>One of the saddest stories of the 21st century is China’s decline into despotism. They didn’t have democracy, but they had internal political competition and a peaceful transfer of power. In an alternate world, Xi is comfortably retired while China and America drive a new century of human prosperity. I think the US and the west would be doing the exact same things to China regardless of what happened with Xi. When China decided to design phones instead of manufacturing them for American companies, that's when their fate was sealed and the west (and Japan) took action. China wanted to move up the value chain. The west wanted China to remain as their factory. The "China bad" propaganda is just to convince western commoners that doing these things to China is justified. It's about economics and power. Always is. Always has been.
- kasey_junk 2y ago
  That didn’t happen when Japan or Korea moved up the value chain.
  - aurareturn 2y ago
    It did happen for Japan. >“When governments permit counterfeiting or copying of American products, it is stealing our future, and it is no longer free trade.” So said US President Ronald Reagan, commenting on Japan after the Plaza Accord was concluded in September 1985. But Japan and Korea weren't/aren't nearly the threat of China due to size.
fxtentacle 2y ago
You should probably read about the "century of humiliation" to understand why dominance through strength is being seen as something very positive in modern China.
- Paradigma11 2y ago
  Understand, sure. Care, no. All nations and ethnicities have tons of grievances in their closet. That is how you get centuries of warfare and jingoism. China had a good thing going, they decided to change for this aggressive path.
  - Kstarek 2y ago
    [flagged]
huijzer 2y ago
You could say the same for Russia. But on the other hand, maybe they were despots all along?

mppm 2y ago

I will add that costs are imposed not only on adversaries, but on everyone. Between reporting requirements, economic sanctions, anti-money-laundering and anti-tax-evasion provisions, perfectly legitimate businesses are probably losing close to a trillion dollars a year on compliance and lost opportunities.