Still, Nvidia wants the business because China is a big market. The newest approvals got here during Nvidia CEO Jensen Huang’s visit to China this week, in keeping with sources who spoke with Reuters on the condition of anonymity. Other Chinese firms are actually waiting for their very own approvals in future rounds, though Beijing is attaching conditions to the licenses which have not yet been finalized. One source told Reuters that the license terms were too restrictive and buyers had not yet turned their approvals into actual orders.
Beijing’s balancing act
The approval signals Beijing’s prioritization of its major Web firms, that are spending billions of dollars to construct data centers needed to develop AI services and compete with US rivals, including OpenAI. But regulators are also attempting to nurture China’s domestic semiconductor industry, the South China Morning Post reported.
The primary batch was expected to go to Big Tech firms in urgent need of the GPU, in keeping with a source who spoke with that publication. Nevertheless, access for state-backed firms, including telecom operators, was expected to remain tightly restricted.
Beijing has previously discouraged domestic technology firms from purchasing foreign chips unless absolutely needed, in keeping with earlier Reuters reporting. One proposal authorities discussed prior to now would require each H200 purchase to be bundled with a set ratio of domestic chips.
“Beijing’s approval of the H200 is driven by purely strategic motives,” Alex Capri, a senior lecturer on the National University of Singapore’s business school, told the South China Morning Post. “Ultimately, this decision is taken to further China’s indigenous capabilities and, by extension, the competitive capabilities of China tech.”
