China allows NVIDIA H200 chips as AI race heats up
What's the story
NVIDIA's H200 artificial intelligence (AI) chips have started entering mainland China in small quantities. The move comes as Beijing tries to balance the demands of its AI industry with a push to bolster domestic semiconductor manufacturers. According to Financial Times, Chinese technology companies ByteDance and Tencent have each received some 10,000 H200 processors recently. Other companies in the country may also receive similar shipments.
Purchase limits
US allows limited chip purchases by Chinese firms
The US has given the green light for Chinese companies to buy up to 100,000 H200 chips each. However, Beijing is pushing firms to keep most of these processors outside mainland China. This is part of its larger strategy to promote the use of homegrown chips.
Chinese regulators have also permitted companies to ship H200 processors to Hong Kong, which lies outside mainland China's customs territory.
Deployment hurdles
Challenges in deploying chips in Hong Kong
Limited data-center capacity and power constraints in Hong Kong could hinder companies from deploying large numbers of these chips there.
The H200 isn't NVIDIA's most advanced AI processor and is behind the company's latest chip generations, which are still banned from sale to Chinese customers under US export controls.
NVIDIA has some 500,000 H200 chips in stock, mostly for Chinese customers, but sales have been impacted by Beijing's restrictions.