China Keeps Buying Hobbled Nvidia Cards To Train Its AI Models

The US acted aggressively last year to limit China's ability to develop artificial intelligence for military purposes, blocking the sale there of the most advanced US chips used to train AI systems. From a report: Big advances in the chips used to develop generative AI have meant that the latest US technology on sale in China is more powerful than anything available before. That is despite the fact that the chips have been deliberately hobbled for the Chinese market to limit their capabilities, making them less effective than products available elsewhere in the world. The result has been soaring Chinese orders for the latest advanced US processors. China's leading Internet companies have placed orders for $5 billion worth of chips from Nvidia, whose graphical processing units have become the workhorse for training large AI models. The impact of soaring global demand for Nvidia's products is likely to underpin the chipmaker's second-quarter financial results due to be announced on Wednesday. Besides reflecting demand for improved chips to train the Internet companies' latest large language models, the rush has also been prompted by worries that the US might tighten its export controls further, making even these limited products unavailable in the future. However, Bill Dally, Nvidia's chief scientist, suggested that the US export controls would have greater impact in the future. "As training requirements [for the most advanced AI systems] continue to double every six to 12 months," the gap between chips sold in China and those available in the rest of the world "will grow quickly," he said.

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