The divorce of China and Nvidia is a fact. The Xi Jinping government no longer recommends Chinese chips: it demands them

China is touring a path that has no going back. US sanctions and their allies prevent Chinese companies and public institutions that are dedicated to the development of models of artificial intelligence (AI) access the most advanced GPUs that design NVIDIA, AMD or brains, among other Western alignment companies. And in these circumstances the government led by Xi Jinping only has one option: minimize China’s dependence of technologies from abroad.

In early October 2024 The administration arrived To the companies of Chinese a recommendation in which it asked them to use chips produced in China as much as possible. Ten months later, According to SCMPthis recommendation has become a demand. And it is that the Chinese government is already forcing data centers that belong to the State throughout the country to use at least 50% of Chinese integrated circuits on its servers. This scenario clearly favors a company: Huawei.

Huawei has a unique opportunity, but also a monumental challenge

Huawei invests more than $ 25,000 million annually in The development of your hardware for AIso presumably it will not take long to match the benefits of the GPUs produced by NVIDIA or AMD. His most ambitious proposal right now is the chip Ascend 910dwho seeks to overcome the performance of the GPU NVIDIA H100. However, this Chinese company has also recently presented its chip Ascend 920a solution that is clearly destined to occupy in the Chinese market the gaps that it will leave The H20 GPU of Nvidia.

This proposal will enter large -scale production during the second half of 2025 using 6 NM integration technology that have presumably developed elbow with Huawei elbow and SMIC (Semiconductor manufacturing international corp). Nevertheless, Huawei faces a huge challenge that probably in the short term it will prevent you from satisfying the demand for chips for Ia from the Chinese market. In the middle of last June Jeffrey Kessler, the Undersecretary of Commerce for Industry and Security of the US Department of Commerce, He made this statement In Congress:

“Our evaluation indicates that the production capacity of Huawei Ascend by 2025 will be 200,000 units or less, and we foresee that the majority or all of that production will be delivered to companies within China.” This prediction about the production capacity of avant -garde chips for Huawei is sustained on an irrefutable fact: the mate of the integration technologies used by the Chinese manufacturer of SMIC semiconductors to produce the Huawei GPUs has a very wide margin of improvement.

SMIC already has the ability to manufacture 6 Nm integrated circuits, and soon it can also produce 5 Nm semiconductors, but is limited by the performance of the deep ultraviolet lithography equipment (UVP) you have in your possession. It is meritorious that SMIC and HUAWEI engineers have managed to refine their integrated circuit manufacturing processes what is necessary to produce 5, 6 and 7 nm chips With ASML UVP teams, but a priori it is very unlikely that with these machines they will be able to go beyond the 3 Nm.

And it is because the technique of Multiple patterningwhich is what they are using, imposes important limitations. A note: This strategy in broad strokes consists in transferring the pattern to the wafer in several passes with the purpose of increasing the resolution of the lithographic process. His problem is that he usually has an upward impact on the cost of chips and the decline in production capacity. For Huawei it is a big problem not to have the necessary technology to produce avant -garde semiconductors comparable to those who manufacture Intel, TSMC or Samsung, so it is working on the development of its own team of extreme ultraviolet photolithography (UVE).

More information | SCMP

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