Two of China’s biggest AI players, ByteDance and Alibaba, are looking to place large orders for Nvidia’s H200 chips despite a larger push from Beijing to limit Chinese companies’ use of foreign technology.
The H200 is Nvidia’s second most powerful artificial intelligence chip and only got the green light this week for Chinese sales.
Meanwhile, Chinese officials have already begun discussions on limiting the chip’s sales to domestic firms. Beijing is pushing to build self-reliance in the chip supply chain and has been discouraging its firms from buying from Nvidia.
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Instead, it wants to encourage sales of AI chips manufactured in China by the likes of Huawei and Cambricon. Early this year Beijing even barred government-funded data centres and Chinese tech companies from buying Nvidia’s AI chips.
Still, ByteDance and Alibaba are looking to buy the H200 chips should Beijing give them the green light, Reuters reported, citing four people briefed on the matter.
The companies remain concerned about supply, however, and are seeking clarity from Nvidia, they said.
Before Trump’s decision to allow Nvidia’s Taiwan-manufactured H200 to be exported to China, the H20 was the most advanced AI semiconductor that could legally be exported to China. The H200 is almost six times as powerful as the H20.
The Chinese government has yet to give a clear answer to Trump’s announcement on H200. Recent Chinese moves to restrict Nvidia’s sales have pummelled the US chipmaker’s market share in China. The company once dominated China’s AI market with a 95% share. That hold has been reduced to “zero”, Nvidia chief Jensen Huang said last month.
Beijing reviewing demand for H200
The Information reported on Wednesday that Chinese regulators gathered representatives from companies including Alibaba, ByteDance and Tencent Holdings for an “emergency meeting” and asked them to assess their demand for the H200.
The officials told the companies they would be informed of Beijing’s decision soon, The Information said, citing sources.
Very limited quantities of H200 are currently in production, two other people familiar with Nvidia’s supply chain said, as the US chip giant has been focused instead on its most advanced Blackwell and upcoming Rubin lines.
Chinese companies are keen on the H200 as its ability to train AI models is currently unmatched by domestic equivalents, which are more suitable for inference, said the sources.
Elite Chinese universities, data centre firms, and entities affiliated to China’s military have also sought to procure H200 chips through grey-market channels.
Prior to Trump’s announcement, anyone supplying Chinese entities with the H200 chip would be in breach of federal law preventing US AI processors over a certain performance threshold from being sent to China.
The policy reversal has created an unusual situation where, in theory, older and less powerful Nvidia AI chips like the A100 and H100, two popular models in China, still fall under US export controls, but the H200 does not.
Nevertheless, Chinese companies anticipate authorities may need to review purchase requests and require them to provide use cases, the people said.
“The training of leading Chinese AI models still relies on Nvidia cards,” said Zhang Yuchun, a general manager at Chinese cloud service provider SuperCloud’s solution and ecology units.
“I expect the leading Chinese tech companies to buy a lot, although in a low-key manner,” he added.
Asked about the H200, China’s foreign ministry has only said that the country values cooperation with the United States.
The ministry declined to comment further on Wednesday.
- Reuters, with additional editing by Vishakha Saxena
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