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US chip export restrictions may actually be an advantage for China's AI Infrastructure. Chinese companies are forced to speed up developing their own AI chips
by zicohacks 14d ago
US chip export restrictions may actually be an advantage for China's AI Infrastructure. Chinese companies are forced to speed up developing their own AI chips
- HarHarVeryFunny 14d agoChina themselves recognize this. After Trump relaxed sanctions and allowed NVIDIA H200 sales to China on a case by case basis, the Chinese government stepped in to essentially block it! In addition to Huawei who make the Ascend series that Ziphu are using, there are also at least a half dozen or so other Chinese companies also making their own AI accelerators.
- 0xbadcafebee 14d agoAnd this wouldn't have happened if we had tried to get them to buy our hardware rather than trying to gatekeep. Protectionism never works in the long term.
- ipsod 14d agoLook at how China does it. They'll happily sell us everything we want - more than enough of it, cheap enough, to put all of our own manufacturers out of business. Seems to work for them.
- freakynit 14d agoUS companies should now be more worried about Chinese companies flooding the market with their, hopefully, very affordable GPU's. The scale at which they can manufacture stuff is unmatched anywhere else. Nvidia can kiss goodbye to their 75%+ profit margins. Almost everyone knew that these sanctions would backfire within a few years. You can't really put sanctions that have noticeable negative effects on bigger economies. They only work for small to medium economies. I believe sanctions on any economy in top 10 would fail.
- verdverm 14d agopretty sure they'll be fine for a while, between the build out and import bans, I don't expect demand to slow enough to let supply catch up Nvidia are likely more concerned about AMD taking market share, and I suspect that geopolitics will leave US/China GPUs with largely non overlpping customer bases.
- overfeed 14d ago> I suspect that geopolitics will leave US/China GPUs with largely non overlpping customer bases That's not what's happening in the auto-industry, Chinese EVs are easily outselling American ones. Why would GPUs be any different?
- verdverm 14d agoImport bans, like we have on Chinese EVs in the US. The US already restricts other countries access to Huawei hardware This is another example where we might ask "why would it be any different?"
- HarHarVeryFunny 14d agoI've got to wonder how long the US will still be able get much of the world to go along with requests like this. Europe is already showing some spine and refused to join Trump's war with Iran, and Italy and Spain have also recently shown Trump the middle finger. It'd be ironic if Europe ended up banning ASML (a Dutch company) from shipping to US instead!
- verdverm 14d agoSCOTUS shutting down Trump's Tantrum Tariffs gave everyone a little breathing room Mark Carney said earlier today at the EU, "the goal is not self-sufficiency, but collective resilience." It is through collective action that they can find more resilience to our American Antics.
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- HarHarVeryFunny 14d agoSame thing with Trump not helping Ukraine and berating NATO. He thought he held all the cards, but now Ukraine has a thriving battle-tested drone industry, UK and France have stepped in to replace the US with advanced missiles and anti-missile systems, stepping up their own production and transferring IP to Ukraine. Now, the US is left out in the cold with little influence left, themselves now the ones with an anti-missile shortage.
- ffsm8 14d ago> Protectionism never works in the long term. You seem to misunderstand what Protectionism is. This is not an example of it not working. If anything, it is any example of it working. Because Protectionism is about protecting your industry from foreign competition - exactly what China decided to do.
- pjc50 14d agoThere seems to be a belief that the post-war 20th century order would be a fixed feature rather than a contingency of history. That the US would be #1, Europe #2, and the rest of the world would remain "developing" in rural poverty forever. That somehow China could be prevented from catching up. Now they are, and behind them India. I think people are going to be even more surprised in the latter half of the 21st century when South America and Africa start catching up as well. Brazil is one to watch if they manage to achieve political stability, as is Nigeria if it can transition from being a petrostate.
- 0xbadcafebee 14d agoAnd the end started when China was admitted to the WTO. They had this huge cheap labor force, a government that could centrally plan (in addition to ignoring little things like environmentalism or rights), and an immense wealth of resources. It was like a bunch of sheep letting a baby wolf into the barn. Now the wolf's all grown up.
- my-huge-pony 14d agoWhat's wrong with giving billions of people chance to develop their country and experience better life? China is not "a wolf".
- smallmancontrov 14d agoNothing, but if you believe that laissez-faire capitalism is tautologically good then you can't blame your capitalist overlords for selling your job to China and refusing to backfill it, so you must blame China for developing themselves instead.
- AuthAuth 14d agoIts fine for China to develop. The blame is on them disregarding human rights and environmental outcomes to get there.
- skybrian 14d agoI’m under the impression that industrial policy has been pretty good for some Asian companies but there have also been notorious failures like the Jones Act. So I think it can be summarized as “it all depends” and “skill issue.”
- menaerus 14d agoIt was evident that this will happen. > Compared with our initial baseline on the same hardware, we achieved a 3× improvement in end-to-end serving performance, reaching hardware efficiency and per-token cost comparable to mainstream NVIDIA GPUs. This demonstrates that Chinese chips can support frontier-model inference efficiently and economically at scale.
- verdverm 14d agoyou can also derive some stats from the ~10T tokens a day on 100k devices, 100M / device / day, but then one has to account for the multi-gpu model size, and I need coffee before I go there
- a34729t 14d agoI mean all the database stuff is obvious low hanging fruit for inference engines.
- gpt5 14d agoI’ll just note that NVidia’s moat has never been inference, and there are many chips used at a much larger scale than Chinese chips for inference like TPUs and AMD chips. The other part is that it’s a bit of a meme here to say that the chip restriction is actually helping China (or shall I say, coordinated effort?). For once, we know that China has put a lot of pressure on the US to relax these controls multiple times. In addition to large chip smuggling networks (e.g. 22% of NVidia’s worldwide revenue magically comes from Singapore, and the ratio has been growing). Lastly, assuming acceleration in AI (which we ARE seeing), there might not be time to China to catch up. The best estimate right now is that the first EUV chips from China will not come out before 2030. By that time who knows how powerful AI will be. All I’m saying is that the discussion is so one sided and a bit baselesss with no nuance, that it seems either a meme/groupthink in the community or coordinated. If anything, the data suggests that the US should increase its export controls and better track the tech supply chain if it wants to further curb Chinese progress.
- miroljub 14d ago
- stogot 14d agoIt created demand that would not have been there without restrictions
- NorthSouthNorth 14d agoDidn't everyone make fun of Jenson for saying exactly this?
- verdverm 14d agoNot sure, but there are definitely people around the president on both sides, some who think they can addict the Chinese to our silicon, like its the new opium war or something
- edgyquant 14d agoYes it was a dumb thing to say and it doesn’t follow at all that restrictions on chips has “sped up” anything. China was always going to build their own chips and their pace is unrelated to a lack of nvidia chips.
- aatd86 14d agoYup. That was really short sighted. And good for China. And actually the overall global market market since supply will augment and competition will decrease pricing as well.
- aurareturn 14d agoUS chip export winners and losers: Winners: Huawei, SMIC, CXMT,Chinese ASML-competitors, OpenAI, Anthropic, Amazon, Microsoft, Google, Meta. Losers: Chinese AI labs, Nvidia, AMD, TSMC, Micron, SK Hynix, Samsung, Intel. Any company that depends on Nvidia hardware such as OpenAI, Anthropic, AWS are winners. It means less competition for Nvidia chips and services. If you think Nvidia chips are expensive now, imagine if Chinese companies can buy them freely. Also for American AI labs, it also means they can stay ahead of Chinese AI labs in compute capacity. The American hardware makers lost the lobby fight in Washington.
- throwaw12 14d agoI wonder why Chinese AI labs are losers? In the short term maybe yes, in the long term, maybe they are the winners, they can build on top of cheap inference stack and eventually win on pricing
- aurareturn 14d agoBecause having unrestricted access to both American and Chinese hardware is better than only Chinese hardware. Long term or short term. More suppliers the better.
- bigmadshoe 14d agoPerhaps the future Chinese hardware would not be so cheap or performant had Nvidia export controls not been put into place.
- klrefg 14d agoLogically one would expect it to be relatively more expensive and less performant because it does not have to compete with Nvidia’s hardware.
- bigmadshoe 13d agoI'm not sure I agree. The market pressure for this innovation might not have been there with Nvidia chips still available. In this case it is coming from necessity.
- abtinf 14d agoWhere the US sees itself penalizing China with an export restriction, China sees the US gifting it with zero-political-cost “protective” import tariff. You can’t really hurt a country that has a culture with a positive attitude toward growth.
- christina97 14d agoNobody pretended that Chinese firms would just lay back and twiddle their thumbs when faced with import restrictions. The question was whether they would be far enough to be able to catch up without much issue or so far behind that they wouldn’t ever effectively catch up or that by the time they did, it wouldn’t matter. Half-arsed export restrictions are the best of both worlds for these firms: enough of an incentive to take homegrown hardware seriously, yet not aggressive enough to cause meaningful handicap in the meantime.
- brazukadev 14d ago> Half-arsed export restrictions What's the alternative other than a military/naval embargo?
- chvid 14d agoOf course it is - how else could Huawei and a number smaller companies compete with NVIDIA.
- rising-sky 14d ago"Necessity is the mother of invention". If someone is capable of doing something, and your goal is to prevent them from doing it, the worst thing you can do is to make it necessary for them to do it. [edited for grammar]
- thih9 14d agoAlso the mistake made by cartoon villains or mythological figures. Just leave that damned prophesied hero alone. Don’t banish them, don’t attempt to kill them while they’re young, or send them on an impossible quest. Your entitled meddling is exactly what puts them on their path. Some level of boring coexistence may have been an option.
- rising-sky 14d agoHaha, indeed. Although, who knows if folklore is just survivorship bias. If the villain succeeds then the story is not as interesting right?
- thih9 14d agoBut that’s the point, the villain is incapable of succeeding. Their habit of perceiving everything as threat eventually leads them to their doom. Also note that grandparent comment is about both folklore and current events.
- aesthesia 14d agoThe question is whether the goal is to stop (or delay) China from developing its own AI chips or to stop (or delay) Chinese AI development in general.
- rising-sky 14d ago[flagged]
- unrented7977 14d agoThe absolute goddamn hubris of the USA as a whole would be astonishing if it weren't so fucking stupid
- jeffybefffy519 14d agoRestrictions make people innovate.... Slightly similar is US sanctions on NK & Russia causing a restriction of foreign currency - so they turned to cyber crime to get it...
- ux266478 14d agoIt's certainly encouraged a lot of the efficiency innovations that have come out of Chinese labs. The fact you can run a Kimi K3 on a single node is batshit insane.
- thehappypm 13d agoYes, but the lag time is crucial. The NY Times estimated that China has 10% the compute capacity of the US. They may catch up, but by that time the US labs could have too much of an advantage