"NVIDIA A100 Replacement '910B Ascend AI Chip' Order"
China's largest search company Baidu has reportedly placed an order for artificial intelligence (AI) semiconductors with domestic company Huawei, according to multiple sources cited by major foreign media on the 7th.
Amid expectations that U.S. export restrictions on China will instead accelerate the development of Chinese semiconductors, Baidu is attempting to shift its AI chip supply chain.
According to reports, Baidu ordered 1,600 units of the 910B Ascend AI chips from Huawei last August. The Ascend chip was developed by Huawei as an alternative to Nvidia's A100, and by last month, Huawei had delivered about 1,000 chips, accounting for more than 60% of the order.
The order from Baidu is valued at approximately 450 million yuan (about 80.9 billion KRW), and Huawei plans to fulfill all orders by the end of the year.
This year, Baidu launched the AI chatbot "Ernie Bot" as a rival to ChatGPT, creating a high demand for Nvidia's graphics processing unit (GPU) semiconductors. GPUs serve as the brain in generative AI like ChatGPT, and Nvidia holds over 90% of the global AI GPU market.
Baidu, along with Alibaba and Tencent, has long been a customer of Nvidia. However, the U.S. banned exports of Nvidia's A100 and H100 chips to China last year and further restricted exports of the China-specific versions, A800 and H800, last month.
Sources said, "Compared to the thousands of chips Chinese tech companies have ordered from Nvidia, the quantity Baidu ordered from Huawei is very small, but it is important as it shows how some companies are seeking alternatives to U.S. firms."
They added that Huawei's Ascend chips still lag significantly behind Nvidia's chips in performance but are currently the most sophisticated option available in China.
They also stated, "Baidu ordered the 910B chips in preparation for a time when it can no longer purchase Nvidia chips."
Baidu was reportedly not previously a customer of Huawei's AI chips. Earlier, Huawei's Vice Chairman Xu Zhijun urged Chinese companies to expand the use of domestically produced chips.
At a conference last September, Vice Chairman Xu said, "There is still a technological gap between Chinese-made and foreign-developed semiconductors, servers, and PCs, but if we do not use products developed in-house, that gap will never be closed."
He added, "Using our self-developed products on a large scale will help drive the advancement of our technology and products."
At the end of August, Huawei surprised the market by launching the 5G smartphone "Mate 60 Pro," equipped with a 7nm (nanometer, one billionth of a meter) process processor, bypassing U.S. sanctions. Huawei was placed on the U.S. blacklist in 2019.
Huawei has remained tight-lipped about the specifications and process of the Mate 60 Pro, but experts analyze that the smartphone is equipped with the high-performance semiconductor "Kirin 9000s," designed by Huawei's semiconductor design subsidiary HiSilicon.
The release of a smartphone with advanced semiconductors manufactured in China using Huawei's own technology was seen as "a slap in the face to the U.S."
Vice Chairman Xu promoted that Kunpeng and Ascend semiconductors designed by HiSilicon could serve as alternative central processing units (CPUs) in domestically produced computers used for cloud computing services and AI language model training.
Major foreign media reported, "Analysts forecast that last month's U.S. export restrictions on China will open opportunities for Huawei to expand in its $7 billion (about 9 trillion KRW) domestic market."
They added, "As China pours investments into growing its semiconductor industry, Huawei's orders are another sign of the company's technological progress," noting that "Huawei's HiSilicon has begun exporting newly developed surveillance camera processors."
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
