Nvidia, the world’s largest company by value, is reportedly developing a new artificial intelligence ( AI ) chip based on its flagship product B200 for the China market.
Reuters reported, citing a source with knowledge of the situation, that the mass production of the new device, which might be called B20, will begin after this year and that shipment will begin in the second quarter of the following year.  ,
According to the report, Nvidia will collaborate with Inspur, one of its producers in peninsula China. But, Inspur claimed to have not yet started any B20-related businesses or partnerships. It asserted that the Reuters document is untrue.  ,
Additionally, according to the Reuters report, the B20 may be created in a way to prevent the US from violating trade restrictions.  ,
However, it’s unclear whether Nvidia will ultimately be able to start the B20 given that Washington may impose a tighter restrictions on exporting chips.
According to a research note cited by Jefferies experts, it is likely that the US Commerce Department’s quarterly review of its export settings in October will result in the H20 device being banned from sales to China.  ,
The statement said the restrictions may occur in three ways: through a “product-specific restrictions, lowering the processing power cover, and/or putting a cap on memory power”.
Besides, it said the US may consider extending its import controls on cards sold to other Eastern countries, such as Malaysia, Indonesia, and Thailand – or extending the settings to overseas Chinese firms, although these would be harder to implement.
The report was made after the Wall Street Journal reported on an underground system that has been importing A100, which has been a sneaking crates into mainland China since October 2022.  ,
According to the statement, some middlemen established research institutes in Southeast Asian nations like Singapore to acquire A100 chips from the US. When Chinese students who are returning from abroad for vacations, they are paid to take these cards to China.  ,
In one case, a 26-year-old Taiwanese student properly brought six A100 cards in his baggage to China and made US$ 100 for each of them.  ,
The standard marketing value of A100 is about$ 10, 000 while the device is priced at about$ 22, 500 in the black market in China. Customers of smuggled cards don’t use Nvidia’s insurance or repair services.  ,
Castrated type:
In October 2022, the US Commerce Department’s Bureau of Industry and Security ( BIS ) banned the exports of the A100 and H100 chips to China. Next October, it blocked the shipping of the A800 and H200 and some other Artificial chips to China.
Nvidia therefore launched three AI cards, including the H20, L20 and L2, for the China market.  ,
The single-chip performance of the H20, dubbed as the” castrated version” of H100, is about 15 % that of the H100. But the solution also sees strong demand from Alibaba, Tencent, Baidu and ByteDance.  ,
The Financial Times estimated that Nvidia’s profits of H20 cards in China may reach one million products, or US$ 12 billion in value, this year.  ,
Cailianpress.com, a Shanghai-based economic news site, said the first shipment of H20 arrived in China in May and June while big Chinese tech firms are then testing them.  ,
The website said Nvidia’s Compute Unified Device Architecture ( CUDA ) platform, which can expand the capabilities of graphic processing unit ( GPU) acceleration, is so powerful that many Chinese users cannot resist.
Li Yali, a journalist of Guancha.cn, on Monday published an article with the name” Will Nvidia’s H20 get banned from being shipped to China”?
She says in the article that the H20 has an advantage in AI training and reasoning as its high-band-width ( HBM ) capacity is higher than that of the H100 and China-made AI chips.  ,
She claims that for China or the US, banning the import of H20 to China is insufficient.
Stress from US politicians
A bipartisan bill introduced by US lawmakers on May 9 called Enhancing National Frameworks for Overseas Critical Export Act, which aims to ease the Biden administration’s decision to impose trade controls on AI designs. According to them, the costs can lessen the chance that US tech is passed into the bad hands.  ,
The House Foreign Affairs Committee largely voted to send the bill to the House of Representatives on May 22.  ,
Lin Jian, a spokesperson for China’s foreign ministry, stated on May 10 that if trade and technology are linked to politics and ideologies, turning them into tools, or even calling for the breakup and severing of supply chains, China’s and US’s ordinary trade and shared investment will simply suffer.  ,
Read: China uses Nvidia cards via Azure, Google sky
Observe Jeff Pao on X at , @jeffpao3