Despite US implemented measures to limit the sale of high-performance AI chips to Chinese companies, ByteDance, the Chinese tech giant behind TikTok, is reportedly doubling down on its AI ambitions. The company plans to become one of the world’s biggest consumers of such hardware and centre to its plan is its reliance on Nvidia chips.
Citing a person who has been involved in the plan, a report by The Information says claims that ByteDance plans to spend a staggering $7 billion on Nvidia’s cutting-edge AI chips in 2025.
“The Chinese owner of TikTok recently told suppliers it planned to spend up to $7 billion to access Nvidia chips outside China in 2025,” the report said.
“The effort, led by co-founder Zhang Yiming, would make ByteDance one of the world’s biggest consumers of such hardware,” the report added.
Why this is significant
There have been reports which claim that Chinese companies get access to advanced technology such as Nvidia’s sophisticated AI chips by circumventing restrictions by procuring the chips through channels outside of China.
Reports have suggested that the Chinese companies are either creating new entities to bypass restrictions or are training their models outside China.
Recent reports, however, claimed that that four major Chinese industry associations have urged domestic firms to exercise caution when purchasing US-made chips, citing concerns about reliability and security. This development could significantly impact American chipmakers such as Nvidia, AMD, and Intel, which have maintained a presence in the Chinese market despite stringent export restrictions.
The move came in direct response to the latest round of US export controls on advanced semiconductor technology to China announced earlier this month. The US government has been steadily tightening restrictions on chip shipments to China, aiming to curb the country’s technological advancement, particularly in artificial intelligence and military applications.