American chip maker NVIDIA has found a new way to maintain its relationship with Chinese tech firms despite Washington’s sanctions against Beijing.
The US rules restrict exports to China to prevent the superpower from accessing cutting edge technology in order to protect American national security.
NVIDIA argues that its new A800 chip comply with the rules by having less processing power than its more advanced A100 semiconductors.
While the A800 offers a chip-to-chip data transfer rate of 400 gigabytes per second, the A100 provides a 600 gigabytes per second transfer rate.
“The Nvidia A800 GPU, which went into production in Q3, is another alternative product to the Nvidia A100 GPU for customers in China,” a NVIDIA spokesperson told Reuters. “The A800 meets the US government’s clear test for reduced export control and cannot be programmed to exceed it.”
A US Securities and Exchange Commission filing from NVIDIA said that licence requirements were set due to the risk that “products may be used in, or diverted to, a ‘military end use’ or ‘military end user’ in China and Russia.” NVIDIA said it does not export to Russia.
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NIVDIA’s new chip is a relief for Chinese firms who recently held emergency meetings over US sanctions. The Chinese Ministry of Industry and Information Technology convened semiconductor firms to assess the risks and damages caused by US export rules.
The US chip maker has said that the rules could have led to millions of dollars lost in revenue. China is an important tech and financial market for American firms, something NVIDIA chips do not want to lose.
NVIDIA has said $400m worth of Chinese chip sales could be impacted in its latest fiscal quarter, ending in October. NVIDIA will report its next quarterly results on November 16.
“And this is mostly centred around semiconductors,” Daniel Clarke, analyst at GlobalData, said. “So the US is trying to stop semiconductor firms on the US mainland as well as many others in Europe, Japan and South Korea, trying to stop them from selling to China.”
GlobalData is the parent company of Verdict and its sister publications.