US ban on Huawei and tighter chip controls on China have brought Nvidia to ZERO in the Chinese AI market, according to the CEO Jensen Huang. The chief executive has revealed the circumstances it is facing due to the failure of the US sanctions.
Special Competitive Studies Project recently conducted an interview with the CEO of Nvidia – Jensen Huang. During the interrogation, the chief mentioned how the US restrictions backfired and put the powerful company in a cage.
Jensen stated that just two years ago, Nvidia owned the lion’s share in the Chinese AI industry. However, the tough changes in the chip export policy ruined everything.
The executive stated that Nvidia was doing great in China unless the US chip controls hit its own chip sales directly. The problem began when the Trump administration restricted the company from selling its AI processors to China.
Bernstein predicted that after 66% decline in 2024, Nvidia’s share in China’s AI GPU market could further drop to at least 8% more in the coming years due to two reasons:
- First: US chip controls
- Second: Chinese tech firms are making strides and meeting up to 80% of the market demand.
NVIDIA CEO said:
“In China, we have dropped to zero. Conceding an entire market the size of China probably does not make a lot of strategic sense, so I think that has already largely backfired. Maybe it made sense at the time, but I think the policy really needs to be dynamic and needs to stay with the times.”
Adding more, Jensen stated that China has cheaper energy with incredible talent. The number of AI researchers in the country is quite extraordinary and can be said to be one of its treasures.
China is now focusing on the “self-sufficiency” path instead of relying on US technologies. Hence, the US AI chipset export controls can be strategically counterproductive for its own companies.
Meanwhile, constant participation of American companies in China can help the US to extend the global reach of its AI technology stack. And since China is already choosing Huawei, Cambricon, Moore Threads, and MetaX, US rules may slow down the American firms’ deployment in the country.
(Image Credits: Huawei)
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