Don't underrate China's ability to catch up in chips: Nvidia CEO, Nikkei Asia, May 30, 2023.
LAULY LI, Nikkei Asia tech correspondent
Jensen Huang says Beijing will foster competitive companies amid U.S. tensions
Nvidia founder and CEO Jensen Huang has warned that China will cultivate its own chip companies in response to tensions with the U.S. and that existing chip players will have to work hard to stay competitive.
"Whatever the regulations are ... of course we will absolutely comply, but I think China will use the opportunity to foster their local entrepreneurs, and that's why there's so many GPU startups in China," Huang told a global media roundtable at the Computex Taipei industry expo on Tuesday.
GPU refers to graphic processing units, a type of chip that can handle large amounts of graphic data, making it critical component in artificial intelligence technologies as well as gaming.
"Right now, if you weren't in the chip industry and you wanted to start a chip company, what company would you start? You would start a GPU [company]. And there's a whole bunch of GPU startups in China," he added.
Nvidia, which produces the H100 processors that power generative AI technologies like ChatGPT, has been caught between the world's two biggest economies in their tech war. The company was restricted from selling its advanced H100 and A100 chips to China last year and had to reconfigure the H100 to comply with the U.S. rules in order to supply Chinese clients.
Huang, who founded Nvidia in 1993, said it is hard to predict if the U.S. export controls will end up creating a separate ecosystem for China for AI hardware and software. Nevertheless, he said, the public has to acknowledge China's technological advancements in cloud computing, internet services, digital payments, electric vehicles and autonomous driving technologies.
"We have to run very fast ourselves," Huang said when asked by Nikkei Asia about the technological gap between Chinese GPU players and Nvidia on the sidelines of the event. "The amount of resources that has been dedicated to this area in China ... is quite massive, so you can't underestimate them."
Huang, whose company has reached nearly $1 trillion in market capitalization, has close personal and professional ties to Taiwan. He was born in the southern Taiwanese city of Tainan and moved to the U.S. with his family when he was 9 years old.
While he mostly speaks in English when he is in Taiwan -- where he enjoys an almost rock star level of popularity -- he often switches to Taiwanese when chatting with local suppliers, the media and passersby who recognize him.
After his media roundtable on Tuesday, he was thronged by audience members wanting to take photos with him.
Huang has an especially close relationship with Morris Chang, the founder and former chairman of Taiwan Semiconductor Manufacturing Co., the world's largest contract chipmaker.
He told reporters that he had dinner with Chang in Taiwan a few days ago.
"Our partnership with TSMC is extremely deep," Huang said. "This is now the tipping point for accelerated computing and generative AI, and so over the next decade, the amount of business we do with TSMC is going to grow substantially."
Huang confirmed to Nikkei Asia that the H100 processor is sourced only from TSMC, though Samsung Electronics is also one of Nvidia's qualified suppliers. "We don't dual-source the chips because the technology is too hard to do it twice. It's barely possible to do at one time. ... But we worked very deeply with Samsung in chip fabrication, as well as memory technology and many other areas."
He added that Nvidia's supply chain is designed for "maximum diversity and redundancy," as supply chain resilience is important given that many customers rely on the company.
"We manufacture in as many places as we can. We have worked very deeply with TSMC for a very long time. You know that we also manufacture with Samsung, and we're open to manufacturing with Intel," he said.