The Cyberspace Administration of China (CAC) has ordered major tech firms to stop buying Nvidia’s RTX Pro 6000D chips and cancel existing orders. This includes Alibaba (online marketplace) and ByteDance (TikTok’s parent company). The directive extends to halting ongoing testing and validation, pulling the plug on thousands of planned purchases.
Nationalism Meets Competition
On the surface, this looks like a direct response to escalating U.S.–China trade tensions. Can’t forget that Washington D.C. is tightening restrictions on semiconductor exports. I find it interesting that this order is coming days after Chinese regulators ruled that Nvidia violated the country’s antitrust laws with its acquisition of Mellanox in 2020.
This development isn’t all that surprising. China has both a volatile relationship with the United States and is nationalistic. As more countries throw their chips (no pun intended) into the AI race, it makes sense for China to present itself as a leader. One that’s capable of homegrown innovation. It can’t achieve those goals using chips made by Nvidia, an American company.
Nvidia’s China Problem
At a press conference on Wednesday, Nvidia’s CEO only had this to say:
“We can only be in service of a market if a country wants us to be. I’m disappointed with what I see, but they have larger agendas to work out between China and the United States. And I’m patient about it. We’ll continue to be supportive of the Chinese government and Chinese companies as they wish.”
For Nvidia, China is both indispensable and inaccessible. The company had already designed the RTX Pro 6000D as a workaround. Tailored to comply with U.S. export rules while still offering enough performance to attract buyers in China. On top of that, the U.S. hit semiconductor companies with licensing requirements in order to sell their AI chips to China back in April. Without China, Nvidia’s growth could be in danger despite its recent dominance.
China’s Push for Self-Reliance
For China, the risk is losing access to hardware made by one of the biggest tech companies in the world. Nvidia’s chips are considered to be the most advanced on the market. China is betting on domestic chipmakers to step up and outpace everyone else.
At its core, it’s not about whether Nvidia can sell chips in China. It’s whether China even wants Nvidia inside its borders anymore. Beijing is signaling that relying on an American company for their AI chips won’t be tolerated. Will the future of AI be built on technology that’s shared globally? Or will it be divided into rival ecosystems, each advancing on its own terms?
