ByteDance Plans to Sidestep U.S. Sanctions by Renting NVidia GPUs in the Cloud
Arthur T Knackerbracket has processed the following story:
Like other Chinese entities, TikTok owner ByteDance cannot buy the highest-performance Nvidia GPUs and install them into its data centers in China. However, the company has found that it can still use Nvidia GPUs that are physically located in cloud data centers in other countries. Next year, the company aims to expand its usage of such GPUs and spend as much as $7 billion on access to Nvidia GPUs, reportsThe Information,citing its own sources. ByteDance has denied the report.
The report says ByteDance plans to invest over $20 billion in AI infrastructure, including $7 billion in accessing advanced Nvidia GPUs in the cloud, data centers, and even submarine cables. The U.S. prohibits ByteDance from purchasing Nvidia GPUs and using American cloud services. However, it cannot block ByteDance's access to cloud services elsewhere, for example, in the Middle East or Asian countries. As a result, ByteDance can access American processors while technically adhering to U.S. sanctions against China's AI and HPC sectors.
ByteDance has denied the report. However, if the report is correct and ByteDance invests $7 billion in cloud access to Nvidia GPUs, it will be one of the world's largest consumers of AI hardware.
[...] Notably, ByteDance is also reportedly working with Broadcom to develop its own AI processors to reduce its reliance on Nvidia. It is rumored that the company will be working on two processors: one for training and another for inference. The chips are projected to be made by TSMC on its N4/N5 process technologies and will enter mass production in 2026. Although ByteDance will unlikely be able to make its GPUs significantly faster than Nvidia's HGX H20 due to U.S. export control restrictions (which would prevent TSMC from shipping high-performance GPUs to Chinese entities), in-house processors will be considerably more cost-effective for the company.
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