China bans tech firms from buying Nvidia chips: FT
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The news: China’s internet watchdog has ordered the country’s biggest technology companies to stop buying Nvidia’s artificial intelligence chips, as Beijing ramps up efforts to compete with the US, according to sources cited by the Financial Times.
The context: The Cyberspace Administration of China (CAC) reportedly told companies including Alibaba and ByteDance earlier this week to stop testing the chips and cancel existing orders.
Before the order, several companies had signalled plans to order tens of thousands of the produced which Nvidia had introduced to circumvent restrictions on the shipment of advanced AI chips to China.
The ban is the latest escalation of the US-China competition on semiconductors, after Chinese authorities issued guidance in August telling companies not to use Nvidia’s H20 chips over security concerns.
The move comes just days after Beijing accused Nvidia of violating its anti-monopoly law, announcing on Monday that a preliminary investigation linked to the US chipmaker’s USD 6.9 billion ($10.4 billion) Mellanox acquisition found breaches of conditions set when the deal was approved in 2020.
The numbers: Shares in Nvidia erased premarket gains on Wednesday to fall 1%, while rival Advanced Micro Devices Inc. fell about 0.7%.
The source: Financial Times
