Despite the restrictions on exporting NVIDIA’s advanced technology to China, it seems Chinese AI giants have discovered alternative routes to access these high-demand resources. The pursuit of powerful computing capabilities continues as companies like Tencent explore creative solutions to maintain their edge in AI development.
Chinese AI Giants Opt for GPU Rentals Over Direct Purchases
The demand for robust computing power among Chinese AI powerhouses is palpable. While domestic AI chip providers are still developing, companies such as Tencent are actively seeking alternatives to meet their needs. A popular option is the rental of compute services, as U.S. export controls are less stringent regarding these transactions. Reports suggest that Tencent has secured access to NVIDIA’s B200 AI chips through a Japanese company, Datasection, engaged in rental contracts valued at over $1.2 billion solely with Tencent.
Since then, Datasection has gained more than $1.2bn in contracts with one large customer to access a significant portion of its 15,000 Nvidia Blackwell processors. That customer, which has a relationship with Datasection via a third party, is Tencent, according to people familiar with the matter.
The deal allows the Chinese tech giant to use a legal but geopolitically fraught strategy to access advanced AI chips at a time Washington restricts the export of Nvidia’s top hardware to China.
– The Financial Times
Datasection holds the latest Blackwell AI chips, encompassing both the B200 and B300 models, which are deployed across various facilities primarily situated in Japan and Australia. Despite these efforts, Chinese AI giants still face challenges in training top-tier frontier models without NVIDIA’s AI chips. This situation has driven companies like Tencent, Alibaba, and Baidu to exploit the “rental compute” loophole to acquire NVIDIA’s latest hardware, which remains inaccessible for direct export to China due to U.S. restrictions.
The Rise of Rental Compute Power
Remarkably, renting compute power has become a prevalent strategy among Chinese firms. Analysts from Bernstein Research believe that this trend may be more appealing than purchasing NVIDIA’s AI chips in China, primarily due to the superior computing capabilities provided by this method. Even though the H200 chips are approved for sale in China, the B200 and B300 AI chips significantly outperform the Hopper option, indicating that Beijing still has access to cutting-edge American technology.