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Nvidia drops price on advanced China AI chip

“Abundant supply” of the chip has forced the American tech corp to lower the cost of its most advanced AI chip bound for China.
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Longtime graphics hardware manufacturer Nvidia is lowering the price of its most advanced China-bound AI chip, pricing it “below a rival chip from Chinese tech giant Huawei,” Reuters reported on May 23. But why the drop in price? “Abundant supply,” sources told the outlet.

In January, IT Brew reported on Nvidia’s chip rollout specific to the China market, in light of the ongoing tech war and the US sanctions placed on chip exports. Neil Sahota, an AI advisor for the United Nations and author of Own the AI Revolution, told IT Brew that while the China AI chip brings certain value, “the real sticking point for a lot of people” is speed and power.

“It’s just that, again, do you want to go 60 miles an hour when you can go 100 miles an hour?” he said at the time, adding that Nvidia, forced to comply with US government regulations, didn’t “want to give up a lucrative market.”

In the meantime, companies like Intel and AMD are losing out as China seeks to reduce its dependence on foreign chips. In April, the Wall Street Journal reported that officials “directed the nation’s largest telecom carriers to phase out foreign processors that are core to their networks by 2027.”

When IT Brew reached out, Nvidia declined to comment. We’ve also reached out to Huawei, Intel, and AMD for comment.

Top insights for IT pros

From cybersecurity and big data to cloud computing, IT Brew covers the latest trends shaping business tech in our 4x weekly newsletter, virtual events with industry experts, and digital guides.