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GPU maker Nvidia has launched a new advanced chip that it believes is compliant with US government export controls in China. The chip, known as the A800, represents what is believed to be the first effort by a major US semiconductor company to circumvent Washington’s sanctions, which are designed to limit Beijing’s capabilities but could be harmful for companies that rely on the Chinese market.
The A800 is being marketed by retailers in China as a replacement for Nvidia’s popular A100 GPU, which is used in datacenters, but is now banned from being sold to Chinese customers under US rules that have come into force last month.
What is the Nvidia A800?
An Nvidia spokesperson said Reuterswho first reported the news: “The Nvidia A800 GPU, which went into production in Q3, is another alternative product to the Nvidia A100 GPU for customers in China. The A800 meets the Government’s clear test of the United States for reduced export control and cannot be programmed to overcome.
Specifications published in China suggest that the A800 is an advanced GPU with more limited capabilities than the A100. It apparently offers a chip-to-chip data transfer speed of 400 gigabytes per second, compared to 600 gigabytes per second in the A100. The new rules prohibit the sale of chips with rates of 600 gigabytes per second and more.
At least two Chinese websites run major server manufacturers that already offer the A800 chip in their products, Reuters reports. One of those sites, Inspur, previously used the A100 chip as a selling point in promotional material.
Why is Nvidia taking action in China?
Nvidia was forced to act because of new US export controls, which are designed to limit the capabilities of the Chinese semiconductor sector. The company, along with another US chipmaker, AMD, was warned in September to stop selling AI chips to China or face government action.
Formal export controls were introduced a month later and, like the chips themselves, restrict US companies from selling to Chinese customers the machinery used in the production of sub-14 nanometer semiconductors, the process used to make the world’s most advanced chips. Any company with operations in the United States is now prohibited from exporting any chipmaking equipment to Chinese customers that cannot be supplied by foreign competitors.
It is thought that China does not have the ability to make its own advanced semiconductors, so the ban is designed to maintain the advantage of the United States when it comes to this crucial area of technology.
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But while it makes sense on a geopolitical level, for companies like Nvidia, it could be very problematic at a time when revenues are declining due to the global economic slowdown. China consumers 40% of all semiconductors produced in the world, although the majority of these are older components that are not covered by the ban.
Speaking to Technical monitor last month, Mike Orme, who covers the semiconductor market for GlobalData, said: “Nvidia and AMD can still sell older and less powerful AI chips to China and Nvidia has a significant R&D operation in China where it gets about a quarter of its overall revenue. ,. The ban will leave a $400 million hole in that revenue.”
He added that the ban could represent a continuing problem for American companies such as Nvidia, AMD and Intel. “The semiconductor industry relies on US IP and the Chinese chip market, and the US chip industry derives more than 30% of its revenue from its sales in China,” Orme said. “Another blockade by China would threaten the future of US chip companies. This is the serious conundrum facing the industry – by hurting China to protect its sovereignty, the US will hurt its strategic industry more important”.
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