Before the approval from Trump to Jensen Huang, CEO of NVIDIA, to sell its H20 chips, and just some months after the US government increased restrictions and bans on semiconductor exports to the Asian powerhouse, around US$1 billion (~RM4.22 billion) worth of the GPU maker’s AI chips were being smuggled into the country. This was all thanks to a thriving black market that came about from the bans in China.
An investigation by the Financial Times (paywall) uncovered a sprawling spider-web of third-party datacentre operators, middlemen, and a rumpload of allegedly smuggled ready-built racks. Racks that, by the way, support NVIDIA’s more recent and potent B200 chips, as well as H100 and H200 chips
The said chips were being sold on ready-built racks, with each rack containing eight B200, plus components and relevant software needed to make it a plug-and-play machine, to be plugged right into a datacentre. Price-wise, each of these racks cost about US$489,000 (~RM2.06 million). One Chinese company, known as Gate of the Era, reportedly obtained two shipments, each containing a few hundred B200 racks, in mid-May. It then sold the NVIDIA AI chips, both directly and indirectly, to a variety of datacentre suppliers and other companies.
As a reminder, the current Trump administration recently gave NVIDIA the green light to continue the sales of its GPU-based AI chips into China, but only the watered-down H20 models. Despite the restrictions, images showing boxes of server racks from companies like Supermicro and ASUS, all designed to support the beefier B200, H200, and H100 AI chips, show just how rampant the Chinese black market is.
NVIDIA has told Financial Times that, despite its more powerful AI chips flowing through the Chinese black market, it has “no evidence of any AI chip diversion” in this channels and implied that it is a fool’s effort for these Chinese companies. “Trying to cobble together data centres from smuggled products is a losing proposition, both technically and economically,” it said. “Data centres require service and support, which we provide only to authorised NVIDIA products.”
(Source: Financial Times, Engadget)
