US Playing a 'Sad Game' With Nvidia, Chip Firms: Chinese Media

A prominent Chinese media outlet says US export restrictions on chipmakers such as Nvidia are a “sad” game that will hurt both companies and the countries involved.

US curbs on chip exports to China were like playing “catch me if you can” with chipmakers like Nvidia and others, the Global Times said in an editorial on Saturday (November 11).

The state media outlet said that as well as affecting the interests of both countries, the US moves accelerate innovation in China’s chip sector, a claim that many have said previously.

The commentary follows a report by chip industry newsletter SemiAnalysis, which said that Nvidia plans to release new artificial intelligence chips aimed at the Chinese market less than a month after the US tightened rules on selling high-end AI chips to China.

ALSO SEE: Nvidia Producing Three New Chips for China, Local Media Says

‘Strong political interference in free trade’

“The several rounds between Nvidia and the US government are the story of a high-tech enterprise that does legitimate business but encounters strong political interference in free trade, and tries every means to ensure its own survival and development,” the Global Times said.

“For commercial companies, this is not funny at all, and even a bit sad.”

The updated US restrictions on chips, which seek to stop China from getting cutting-edge US technologies to strengthen its military, were “not only harmful to China’s interests, but also to the US”, the news-site said.

“What the US government has done makes normal and legitimate transactions tremble with fear, creating an intense atmosphere in the market,” it said.

Last month, Nvidia, whose graphics processing units (GPUs) dominate the AI market, said the expanded US export controls would block sales of two high-end AI chips, the A800 and H800, that it created for the Chinese market last year to comply with previous export rules.

The new rules put a cap on how much computing power a chip can pack into a small size. They include what analysts call a “grey zone” in which chips might still be allowed to ship to China but will require a license.

New chips ‘have less computing power’

SemiAnalysis said the new Nvidia chips are called the HGX H20, L20 PCIe and L2 PCIe and the company could announce them on November 16.

The chips include most of Nvidia’s newest features but have had some computing power measures cut back, according to the newsletter.

Nvidia, which has a current market cap of close to $1.2 trillion and is one of just six companies valued over the trillion-dollar mark, declined to comment.

The Global Times said US companies had been looking for “work-arounds” to comply with the regulations.

“It is not difficult to imagine that as long as Washington remains committed to ‘choking’ China, the game of ‘catch me if you can’ will continue indefinitely,” the newspaper said.

“In this sense, the ‘loopholes’ that the US is trying to close will never be completely fixed, and they will only find themselves in an awkward situation of pressing one end of the gourd only to make the other end float up.”

“This will inevitably force and accelerate the process of independent innovation in high-tech industries in China.”