The US Commerce Secretary made news a little more than a week ago when he appeared to publicly threaten Nvidia. In order to comply with US restrictions, the GPU producer has started “updating” its existing GPUs, decreasing their performance and making them into “new” models. The Secretary responded to this by declaring that any “workaround” items (our term) would likewise be sanctioned—not later, but right now. The Secretary stated the government is in talks with Nvidia to explore future opportunities for the two companies to collaborate on export regulations, suggesting that position has somewhat changed.
“If you redesign a chip around a particular cut line that enables them to do AI, I’m going to control it the very next day,” said US Commerce Secretary Gina Raimondo at a recent conference. She didn’t specifically say Nvidia, but it was obvious to all that she was talking about the business. The Secretary seems to have grown a lot more understanding this week. Speaking to Reuters, the Secretary stated that Nvidia “can, will, and should sell AI chips to China because most AI chips will be for commercial applications.” She made it clear that the business will still not be permitted to export China its strongest chips, but it appears that the workaround goods will now be accepted without resistance from the authorities.
According to Raimondo, she spoke with Nvidia CEO Jensen Huang a week ago, following up on her vehement remarks, as reported by Reuters. According to reports, he told her that Nvidia was not trying to evade US sanctions and said, “We don’t want to break the rules.” We’ll cooperate if you tell us the rules.” While Nvidia has reaffirmed that it will abide by US penalties, the business has declined to speak to Reuters. To be clear, there has never been a claim that it has broken them.
For the time being, it appears that the two parties involved in this dispute are cooperatively attempting to create a path forward devoid of confrontation. It is probable that Nvidia will persist in marketing goods that skirt the boundaries of US restrictions. Its 25% revenue comes from China, so as long as it’s not selling its most powerful hardware, it should be able to maintain its business relationship. According to CNBC, AMD is apparently thinking about creating a customized MI300 accelerator that has been neutered especially to comply with US export regulations in order to sell to China.