Chinese companies have lost access to one of the country’s largest distribution channels for Nvidia processors after the US added a major reseller to its export blacklist, adding to Washington’s efforts to curb China’s artificial intelligence (AI) development and more to push Chinese companies towards local substitute products.
According to a Reuters report, the companies were “involved in providing AI chips for China’s military modernization programs” and military intelligence users, Kevin Kurland, an export control official at the U.S. Department of Commerce, said at a Senate subcommittee hearing.
In a statement, China’s Commerce Ministry called the U.S. sanctions “abusive” and “a weapon” of export controls.
Sitonholy is one of the few “elite-level” providers of Nvidia data center product solutions in China and has retained its franchise rights to deliver strong sales year after year, according to people with direct knowledge of the matter, who declined to be named for that reason You are not authorized to speak to the media.
While Nvidia has been banned by the US from exporting to China its advanced A100 and H100 data center graphics processing units (GPUs), which are in demand for AI training, the company has been developing new replacement products for China-based customers. like the H20, L20 and L2 GPUs.
However, Sitonholy has effectively stopped selling Nvidia products due to the US blacklist and is now forced to sell mainly domestic chips, sources said.
Sitonholy sells Huawei Technologies’ Ascend 910B AI chips – an alternative to Nvidia’s A100 GPUs – and other Huawei data center solutions such as Atlas 800I A2 inference servers.
Various tests have shown that the Huawei 910B can achieve around 70 percent of the performance of the Nvidia A100.
It’s not immediately clear whether Nvidia would complete orders placed through Sitonholy before the company was blacklisted. The South China Morning Post could not reach Sitonholy for comment on Saturday.
China has accelerated efforts to replace foreign chips and software with domestic products to ensure national and industrial security.
Huawei has emerged as a powerful provider, which is crucial to building an ecosystem based on home-grown hardware and software solutions such as HarmonyOS.
The Shenzhen-based giant defied US sanctions last year and launched a 5G smartphone equipped with a 7-nanometer cellular system-on-a-chip from Chinese manufacturer Semiconductor Manufacturing International Corporation (SMIC). was.
Huawei and SMIC are among more than 600 Chinese companies placed on Washington’s export control lists, preventing U.S. suppliers from supplying goods and technology to these Chinese companies without special authorization.
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