US bans AMD from selling AI chips made to China without license: sources

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U.S. officials have told Advanced Micro Devices (AMD) that an artificial intelligence (AI) chip designed for the Chinese market is too powerful to sell without a license, prompting another U.S. semiconductor company to sell its advanced technology in Washington. Caught in a crackdown on exports.

AMD had hoped to get a green light from the U.S. Commerce Department to sell AI processors to Chinese customers because the company’s performance outside of China is lower, according to people familiar with the situation. , who asked not to be identified. Because the matter is private.

But U.S. officials told AMD it must obtain a license from Commerce’s Bureau of Industry and Security to sell it.

AMD did not comment and it is unclear whether the company is seeking a license. The Bureau of Industry and Security declined to comment. AMD shares fell 2.2 percent at the open in New York on Tuesday.

AMD CEO Lisa Su holds up a chip during her keynote address at the CES tech expo in Las Vegas in January 2023. Photo: Matt Haldane/SCMP

California rival Nvidia has also been downgrading its powerful AI chips destined for China in an effort to collude with U.S. authorities — and to pass their ever-tightening restrictions on semiconductors — as Washington tightens its grip on its biggest biotech. Trying to limit one of the political rivals.

The US is working to limit Chinese access to the latest semiconductors that can produce AI models – and the tools used to make those chips – out of fear that Beijing will gain a military advantage.

President Joe Biden’s administration unveiled an initial set of export controls in 2022 and strengthened them last October to include more technology and prevent sales to intermediary countries that could undermine the ban.

Tighter controls banned sales of the processor, which Nvidia designed specifically for China – in compliance with an early 2022 version of export rules.

Nvidia has since developed new customized, less powerful products for the Chinese market to comply with the 2023 restrictions, and Commerce Secretary Gina Raimondo has said she is looking into the details of those components.

A 2022 US ban prevents both Nvidia and AMD from selling their most powerful AI chips to China, forcing them to look for workarounds. Nvidia quickly responded with a modified model with lower performance, while AMD has not publicly discussed its efforts to develop a new AI processor for the country.

AMD had a smaller footprint in the Chinese AI chip industry than Nvidia, which had a large share of the market before the ban. When the restrictions take effect in 2022, AMD said it did not expect to be materially affected by the rules.

Nvidia is sampling alternative AI chips for China as US sanctions take effect.

But AMD is now going more aggressively after the AI ​​chip market. In December, it launched a new MI300 lineup that will challenge Nvidia’s processors.

According to the people, the Chinese-made product is called MI309. It’s unclear which Chinese customers were trying to buy AMD AI chips. This factor can affect whether a company is able to obtain a license, should the chipmaker choose to proceed.

Leading Chinese tech firms, including Tencent Holdings and Baidu, have said they have stockpiled enough powerful chips from Nvidia – the types now subject to US control – to push the capabilities of their chatbots by another year or two. To increase.

Meanwhile, Shenzhen-based Huawei Technologies is developing its AI semiconductors and chip-making capabilities that could eventually help Chinese companies fill the gap created by the U.S. ban.

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