Chinese technology giant Huawei has announced plans to roll out a new artificial intelligence (AI) chip to rival offerings from foreign semiconductor manufacturers.
According to a Wall Street Journal (WSJ) report, Huawei’s incoming chip is expected to be a direct competitor to Nvidia’s (NASDAQ: NVDA) H100 with sources claiming that the Chinese-made chip outperforms the H100. Dubbed the Ascend 910C, China considers the chip a bold reply to the slew of sanctions imposed by U.S. authorities regarding advanced semiconductors.
Huawei’s new chip is already creating a buzz in the local ecosystem, and a group of Chinese companies, including Baidu (NASDAQ: BIDU) and Bytedance, are participating in early tests. The exact specifications for the Ascend 910C are unknown, but sources claim that the chip will be 20% more powerful than Nvidia’s H100.
The report notes that Huawei has a sweltering waitlist and is expected to deliver 70,000 chips to clients upon a commercial rollout in October. If the company ships out the pre-ordered chips upon launch, WSJ claims that Nvidia could net up to $2 billion in revenues.
However, critics have questioned the company’s ability to meet the demands of tech firms in Mainland China amid a scarcity of advanced chips in the country. Per the report, Bytedance’s interest is expected to be at least six digits, while Baidu and China Mobile will each require at least 70,000 chips to meet their generative AI targets.
Aware of the difficulty of fulfilling orders, Huawei has since splurged funds on the construction of semiconductor factories in China while pursuing high-profile partnerships to complement its in-house efforts.
Despite meeting the burgeoning demand, Huawei still has to compete with Nvidia’s H20 chips, which are specifically tailored for the Chinese market. However, analysts expect the Ascend 910C to surpass the offering. Intel (NASDAQ: INTC) is also keen on rolling out semiconductors that are compliant with existing U.S. trade sanctions.
Yet, Nvidia’s existing market share in China is seen as one final hurdle for Huawei to climb in the quest to stake its claim in the ecosystem. Huawei’s executives say the Ascend chip series is a pivotal moment for the future of the company, describing it as a “life or death” situation in its attempt to compete globally.
Tensions with the U.S. reach a head
China and the U.S. have been embroiled in a cold war, with both countries jostling to get one up over the other in emerging technologies. A key part of the tensions revolves around semiconductors, with the U.S. keen to stifle the Asian superpower’s access to high-end chips for national security reasons.
Despite the trade embargo on U.S. chip manufacturers, China has begun looking inward to fulfill its semiconductor demands, building new manufacturing plants across the country and funding new research. The investments have begun yielding early successes, but China is still on a steep climb to remove itself from U.S. dependence.
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Source: https://coingeek.com/huawei-prepares-ai-chip-for-chinese-market/