NVIDIA's H20 AI chips won't be easy to get into Chinese AI markets, as the local state media is voicing opposition against the move, citing potential backdoors.
Team Green spent a lengthy time pursuing approval for its AI chips to flow into China, and after lobbying the Trump administration, Jensen did get the green light a few weeks ago. However, things have started to take a turn after a Chinese regulator opened an investigation into the H20 AI chips to identify security flaws that could return to Washington. Now, Reuters that Chinese state media CCTV broadcaster claims that the H20 chip isn't safe for the domestic AI markets, as it comes with several backdoors.
When a type of chip is neither environmentally friendly, nor advanced, nor safe, as consumers, we certainly have the option not to buy it. -Reuters
This isn't the only occasion where China has opposed the flow of H20 AI chips, as the nation's cyberspace watchdog recently called out NVIDIA to investigate potential backdoors, including chip surveillance and a 'kill switch'. In response to the claims, NVIDIA was quick enough to push out a blog post, claiming that they would never integrate such mechanisms in their chips , but despite the company's assurances, it seems like the Chinese media is still skeptical.
It is important to note that the Trump administration hasn't ruled out implementing backdoors or similar mechanisms in AI chips going to the likes of China. Interestingly, this move is actually a part of the government's 'AI action' plan, which we have discussed in depth previously , hence ruling out the existence of the 'so-called' backdoors isn't entirely possible for now. However, with the existing H20 AI chips, NVIDIA says there's no chance of such measures being onboarded.
NVIDIA needs to take Chinese AI markets into account if they are eager to sell the massive chunk of inventory they have onboard, and while the firm's PR machine is actively working to address the claims, it seems like the domestic media still doesn't believe in NVIDIA's statements.