Intel develops reduced-capability AI chips for China amid US export controls

The chips will be launched in June and September. Nvidia, a rival company, also plans three China-specific chips in response to tighter US rules on exporting AI chips to China.

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Intel is set to launch two specialised AI chips, HL-328 and HL-388, tailored specifically for the Chinese market in June and September, respectively. These chips are developed in compliance with US export controls and sanctions. The announcement, detailed in a white paper on Intel’s website dated 12 April, comes in response to tightened regulations limiting the capabilities of AI chips exported to China. Nvidia, a competitor in the AI chip market, also has plans for China-specific chips following similar export control restrictions.

Intel’s upcoming China-specific AI chips are part of the Gaudi 3 product line, which was unveiled on 9 April. Despite featuring advanced hardware components like on-chip memory and high-bandwidth memory, these chips will undergo performance reductions to meet export control requirements. The aim is to adhere to US regulations while continuing to engage in the Chinese market.

Nvidia, like Intel, is navigating export control challenges by developing specific AI chips for China. One of Nvidia’s chips, the H20, is anticipated to enter the market in limited quantities in the first quarter of 2024, with larger volumes expected in the subsequent quarter. These developments highlight efforts by major semiconductor companies to adapt to evolving export regulations without completely withdrawing from the Chinese market, aiming to balance compliance with strategic business interests.

Why does it matter?

Both Intel and Nvidia’s initiatives reflect the broader impact of geopolitical tensions on the semiconductor industry. As governments implement stricter export controls, companies are innovating to meet regulatory requirements while continuing to serve global markets. The launch of China-specific AI chips represents a strategic response to these challenges, enabling technology firms to navigate complex trade dynamics while sustaining business operations.