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
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
It 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.
you 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
I mean all the database stuff is obvious low hanging fruit for inference engines.
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The mainstream consensus on PRC silicon has been "the gap exists, but is closing" for a long time[1][2]. I think you might be confusing the algorithmically-cast shadows on the cave wall that you're sat in front of for a reasonable and unbiased sample. Can you provide any reason to believe that your data points are actually generalizable? From your tone it sounds more like you're a victim of getting outrage baited into engagement, and mistaking observations made in that envelope for a high quality data source. You gotta watch out for that mate.
[1] - https://www.eastwestcenter.org/sites/default/files/private/i...
[2] - https://www.usitc.gov/publications/332/journals/chinese_semi...
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It was one of the reasons why Jensen was against the export controls
well, yknow, apart from his vested interest in having 1.4 billion more people to sell GPUs to
for sure, but like the other respondent said, he was talking his own book
and also, arguably jensen`s track record is such that i wouldnt exactly lump him with the mainstreamers )))
Isn't it common knowledge that every better mouse trap breeds smarter mice?
Future AI systems will eke out every last blood drop of performance from any kind of hardware. Not even a single bit flip will go to waste.
Third party here, I feel like I'm missing something. Your comment seems somewhat pointed and I don't understand what exactly you're asking for?
Weren't they just saying that it's self-evident that preventing a manufacturing superpower - one with a significant pool of industrial engineers and effectively unlimited money & government backing - from acquiring some good is a temporary measure? Because if they have sufficient incentive, they would just... Learn to build it themselves?
After all, their entire nation is built around building things, and catching up / leap-frogging is much easier than starting from scratch.
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> in 2022, mainstream and westoid virtualism opinion was ``china is cut off from the future now`` (cue the clownface here). ``we cut off chinas legs`` yadayada
maybe where you were paying attention. were they also certain that americans wouldn't be paying the tariffs?
but lots of people who saw what china was doing with renewable energy and EVs rightly suggested this would put them on the path of independence w/r/t GPUs and LLMs.
this isn't like the ol' days where "japan can't do software". we knew china can.
your attitude isn't warranted.
Yes - I am old enough to remember the Biden admin’s October 7th sanctions, and the chatter about the US having another unipolar moment.
Look into the history clases will be enough. Why would I need to prove anything to a random stranger on the internet?
I’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.
When you say AI will be powerful, what do you mean? Like in terms of national power, will AI let the US fight and win a war against China despite China's size, manufacturing base and possession of nuclear weapons? Will AI let the US beat the Chinese in manufacturing costs and scale despite China's greater adoption of industrial robots and larger number of skilled workers? Or will AI just be really good at writing software?
Because if the AI is just really good at writing software, I am not sure why China has to "catch up". Seems to me China can just treat AI like other technologies. Let the US pay most of the R&D costs, then come after and treat the technology as a commodity. Sell it better and cheaper and at scale.
I am not sure why it's a big deal for China if China is a few months behind the US in terms of the very frontier AI. Just like I'm not sure if it's a big deal which country has the biggest super computer in the world.
If AI is super human, it can beat any nation with today’s technology. It can recursively self improve while suppressing any other lab (think about how good it is in hacking computer systems).
I am not inventing a winner take it all scenario, that is what driving the race.
But, like, how does that smarts lead to beating nations with today's technology? How would an AI stop an incoming nuclear ballistic missile? I've heard on podcasts with MIT professor Ted Postol that based in the laws of physics intercepting these is basically impossible, because of the speeds and physics involved. Can AI discover new physics to overcome those limitations?
If AI cannot stop nuclear ballistic missiles, then how does AI give the US power over China? Seems to me that after AI we have the same mutually assured destruction we have today. In which case America cannot really stop China from progressing or threaten China too much.
Seems to me being super human intelligent does not inherently guarantee power. Just like the smartest person in the world does not always win in a fist fight or a gun fight or war. I.e. Stephen Hawking might have been smart, but he did not have physical strength and power. Power and smarts are not always related.
I just gave you a scenario above - that it hacks every computer system in China, including those controlling nuclear missiles. But a super intelligent AI can invent scenarios that almost by definition we cannot think of.
I would assume that the computer systems in China that control nuclear missiles, as well as our computer systems that control nuclear missiles, are air gapped and therefore not hackable no matter how smart the AI is.
This only demonstrates imposed limits you are able to imagine, not what’s possible in all scenarios. A super intelligent AI can bribe, social engineer and do anything it wants. No system is foolproof.
Well yes in an imaginary world everything is possible. We are less close to what you’re describing than to having flying cars.
Gotta love the bot accounts here
Superhuman does not mean actual superpowers. You still need a path to victory and it's not obvious that there's one that we're just too dumb to see.
Historically civilizations that have been only at a slight technological advantage have completely dominated those that are slightly behind.
And we already see AI’s super human ability in computer systems. It will be able to be Omni present and completely control every computer in any place, and bribe and social engineer and mimic any person digitally. All while doing in an instant what a team of humans would require years.
I’m really surprised by the lack of logical thinking in HN when it comes to China.
You might as well use “magic” in your comments instead of “AI” and you would make an equal amount of sense.
Why do you think the Chinese are not using their ai chips, which afaics are from huawei, to train their models? If that is true, which I think it is, we don't have to wait until 2030 to see if they're gonna match the performance of nvidia GPU. The evidence is already here - glm is among the most competitive models out there.
Look up reports by The Information, DeepSeek’s training of its big models are all done on NVidia’s chips (more than that - on smuggled Blackwell as well). There have been attempts by many Chinese labs to train on Huawei h chips, but they have all been limited to more minor models or distillations of the bigger ones.
Unless you have the source for the latter it's nothing more than propaganda. Also, DeepSeek report is 2-3 years old, and at that time there were no huawei chips, at least not known to the public. This is a different model, in different age where huawei chips are already delivered into the production as we see
The Information have reports on this as recent as this summer
Do you have a link?
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The idea that China wasn’t working hard to build their own chips is a political talking point period. Nothing has been sped up here, China was always going to do this and the backlash you see from people who are against it is only proof that restrictions do hurt them
I do believe your first sentence, but the second one ... doesn't really follow.
The unnatural and sudden nature of the US chip embargo has galvanized the Chinese companies to speed up development. It makes economic sense to do so rather than pay inflated rates to essentially smuggle a necessary good, while never knowing if the embargo will be tightened and those under-the-table supply chains dry up as well.
Yes, there was a plan, but what was planned for 5 years from now is being done today, because if you wait 5 years, you'll be so far behind thanks to the effect of the embargo.
The AI revolution has led to everyone including US companies working to build their own GPUs there is zero proof or reason to think embargo’s are the cause. As I said, China was already working to build their own capacity
> The idea that China wasn’t working hard to build their own chips is a political talking point period.
never heard of this 'talking point' . who is even saying this?
It's an implied corollary: when folks say that "blocking US Chips is what led China to build it's own" they are implying it is US export restrictions that pushed China to innovate. OP is saying this isn't necessarily true. I don't think it is either: China seems to have succeeded due to a centrally planned economy that values independence, with high amounts of strategic government led technology investment.
It can be both. They were already doing it and the situation made it more urgent.
> OP is saying this isn't necessarily true.
but your supposed corollary was
> China wasn’t working hard to build their own chips
kind of dishonest ?
> 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.
Or, to put it bluntly, you are a proponent of the trade war.
"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.
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Also 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.
Haha, indeed. Although, who knows if folklore is just survivorship bias. If the villain succeeds then the story is not as interesting right?
But 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.
The 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.
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US 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.
I 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
Because having unrestricted access to both American and Chinese hardware is better than only Chinese hardware. Long term or short term. More suppliers the better.
Perhaps the future Chinese hardware would not be so cheap or performant had Nvidia export controls not been put into place.
Logically one would expect it to be relatively more expensive and less performant because it does not have to compete with Nvidia’s hardware.
I'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.
Intel shares are still up over 100% since the Trump admin invested in them and started going to bat for them.
I don't think your information is entirely accurate.
Such a great move by the government. Imagine what we could do for US industry if the government took a stake in all major corporations? Many people are saying that the healthcare industry should be next.
Not being able to have unrestricted access to the world's second biggest market does not relate to Intel being up over 100%.
Just logic.
Not making any GPUs worth buying makes you immune to export restrictions.
So we're basing winners and losers on vibes rather than money or performance?
A simple ChatGPT can explain it to you.
Intel being up 100% has nothing to do with China market being restricted. They could be up 200% instead if the China market is free.
>Intel shares are still up over 100% since the Trump admin invested in them and started going to bat for them.
Nokia shares were also up after the iPhone got announced. Current share prices don't really mean much in rational future outcomes, just FOMO, vibes and speculation of clueless masses of investors. They can also swing wildly up/down.
Especially since the market is hobbled and corrupt by now, owned by a handful of machines that humans barely have root control over anymore.
Nobody 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.
> Half-arsed export restrictions
What's the alternative other than a military/naval embargo?
China 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.
And 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.
US 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.
China is gated by not having EUV machine access. They're also bottlenecked by ASML's DUV machine production like everyone else. There are already talks of banning China from even purchasing DUV machines from ASML.
So until China solves the ASML problem, there won't be any flooding.
>until China solves the ASML problem
Which they are in progress on: https://www.reuters.com/world/china/how-china-built-its-manh...
Yes, but we don't know how well they work or what nm can they print or how machines they can make.
They've overcome every hurdle to go from nothing to having working machines, so all these questions are presumably a matter of how fast they will improve and ramp up production (initially 5 this year, 20 next year), not whether they will.
China have been really squeezing all they can out of DUV machines, but I'm not sure how much node size really matters for AI competition - more of a cost issue (more chips/power for same FLOPs) than anything, and TSMC & NVIDIA's healthy profit margins need to be considered too.
I'm well aware of how good China is at manufacturing. However, DUV/EUV machine manufacturing is unproven.
What is the timeline like? 1 year? 5 years? 10 years?
They already have working machines, and are slated to ship the first 5 early production ones right about now (before the end of 2026), and are projecting 20 for next year.
Small numbers perhaps, but this is happening right now.
What will the numbers be in 5-10 years time? Who knows, but ASML took about 5 years to go from 20/yr to 100+/yr.
Of course politically the world may well be quite different in 5 years time, as may be the AI market.
Yes, 5 years seems like an eternity in AI world.
We also don't know how small of nm chips they can manufacture. If it's 20nm, it's practically useless for advanced AI chips.
> There are already talks of banning China from even purchasing DUV machines from ASML
A bit late for that now that they are moving into early production with their own.
pretty 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.
> 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?
Import 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?"
I'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!
>It'd be ironic if Europe ended up banning ASML (a Dutch company) from shipping to US instead!
ASML's Dutch EUV machines depend on importing US made EUV light sources from California to build them, and depends on sales of their machines to the US to stay afloat since they're not exactly flying off the shelves domestically.
So maybe the EU is not that stupid and suicidal to cripple their economy further by cutting off one of their biggest pay-piggies for no reason.
In fact, as an anecdote to your hypothetically scenario, the US is the one with the most leverage since if they want, they can ban the export of EUV light sources to ASML and sell them instead to Canon and Nikon, sinking ASML and propping up Japan's semi industry instead, if relations sour and they see Japan as a warmer ally than the EU. Hypothetical.
Isn't Cymer actually owned by ASML - push come to shove couldn't they just leave the US ?
FYI, the US is only 10-15% of ASML's sales. The bulk of their machines go to China, Taiwan and South Korea.
>Isn't Cymer actually owned by ASML
It's on US soil and subject to US laws and export controls. That's all that matters.
FYI, Nikon and Canon don't rely on ASML-owned Cymer anymore - they use a domestic Japanese supplier instead, Gigaphoton.
Nikon and Canon (gigaphoton) don't have EUV (yet)
SCOTUS 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.
There 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.
And 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.
What's wrong with giving billions of people chance to develop their country and experience better life? China is not "a wolf".
Nothing, 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.
Its fine for China to develop. The blame is on them disregarding human rights and environmental outcomes to get there.
Which country hasn't?
So you think they could have been kept poor and isolated forever?
I’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.”
Look 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.
Same 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.
> 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.
Yes, 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
Restrictions 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...
Didn't everyone make fun of Jenson for saying exactly this?
Yes 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.
Not 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
The absolute goddamn hubris of the USA as a whole would be astonishing if it weren't so fucking stupid
Where 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.
Of course it is - how else could Huawei and a number smaller companies compete with NVIDIA.
It'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.
Yup. 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.
It created demand that would not have been there without restrictions