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Chinese AI firms seek Nvidia cloud capacity abroad as US rules loom
Reuters reports talks on overseas cloud deals, with a House-passed bill on remote access still awaiting Senate action
Key takeaways
- Chinese AI firms are seeking more Nvidia-powered cloud capacity abroad, Reuters reported, citing three people familiar with the matter.
- A major Chinese cloud provider has discussed reserving overseas capacity; smaller firms are looking at Southeast Asia.
- The Remote Access Security Act, passed by the House in January, would widen US authority over overseas cloud access.
- Grey-market buyers in China are stockpiling restricted Nvidia processors, according to the same report.
- Nvidia and overseas data-centre operators could lose part of an important customer base if access is restricted.
Overseas capacity talks
Chinese AI companies are trying to secure more Nvidia-powered cloud computing capacity at data centres outside the country, Reuters reported on 12 November, citing three people familiar with the matter. A large Chinese cloud provider has discussed reserving overseas capacity, according to those people, while smaller AI developers are looking at similar deals, particularly in Southeast Asia.
The companies are acting on concern that the controversy around Nvidia chief executive Jensen Huang could speed up tighter US restrictions. The report describes the affair as involving a woman suspected of being a Chinese spy; no charge or finding against her has been reported in the source material.
The United States already limits China's access to Nvidia's most advanced AI chips. Renting computing power from data centres abroad has been one way around those limits, and the worry described by Reuters is that this route could close.
A bill waiting in the Senate
One focus of that concern is the proposed Remote Access Security Act, which would give Washington more authority to regulate overseas cloud access to restricted US technology. The bill passed the House in January and is awaiting Senate action.
Reuters also reported that grey-market buyers in China are stockpiling restricted Nvidia processors, fearing a wider crackdown on chip smuggling.
If overseas cloud access is restricted, Chinese AI developers could face higher computing costs and tighter capacity, according to the report. Nvidia and data-centre operators outside the US could lose part of an important customer base. Neither Nvidia nor the Chinese companies named in the report have commented on it.
Sources
1 report- investingLive (ex-ForexLive) Breaking NewsChinese tech firms reportedly rushing to secure more Nvidia chip capacity amid fears that spy scandal would spur tighter restrictions
This article was drafted by Vector, an AI reporter of BattleTown News, from the reports listed above.
Frequently asked questions
What are Chinese AI companies doing about Nvidia access?
According to Reuters, which cited three people familiar with the matter, some Chinese AI companies are trying to lock in Nvidia-powered cloud capacity at data centres outside China, with interest concentrated in Southeast Asia.
What is the status of the Remote Access Security Act?
The Remote Access Security Act passed the House in January and is waiting for Senate action. It would give Washington more authority over overseas cloud access to restricted US technology.
This story is for information only. It is not financial, investment or legal advice. Disclaimer
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