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NVIDIA's China driven H20 AI chip faces technical hurdles

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NVIDIA, the US-based technology giant, has announced that it will delay the launch of its new artificial intelligence (AI) chip, the HGX H20, in China until the first quarter of 2024. The H20 chip, the most powerful of the three China-specific chips NVIDIA developed to comply with the new US export regulations, was expected to hit the market in November this year.

NVIDIA's China driven H20 AI chip faces technical hurdles

Bypassing the US ban

However, according to two sources who spoke to Reuters, NVIDIA faced some technical challenges with the server manufacturers who were supposed to integrate the H20 chip into their systems. The sources said that NVIDIA informed its Chinese customers that the H20 chip launch would be postponed to February or March next year.

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The H20 chip is part of NVIDIA's strategy to maintain its market share in China, one of the world's largest and fastest-growing markets for AI chips. The US government has imposed strict export restrictions on the advanced AI products that NVIDIA and other US companies can ship to China, citing national security concerns.

To circumvent these restrictions, NVIDIA designed three new chips - the H20, the L20, and the L2 - with lower computing capabilities than its flagship products, the A800 and the H800(customized H100). The new chips also use a different GPU, the AD102, which has lower memory sizes of 48GB and 24GB GDDR6. The new chips can only deliver a maximum compute performance of 4800 TOPS over the PCIe interface, much lower than the 10,000 TOPS that the A800 and the H800 offer.

Despite these limitations, the new chips still include some of the latest NVIDIA AI features, such as the Tensor Core, the Multi-Instance GPU, and the NVLink. NVIDIA hopes these features will attract Chinese customers who need high-performance AI solutions for applications such as cloud computing, data analytics, and machine learning.

However, NVIDIA is one of many players in the Chinese AI market. Its rivals, such as Huawei and AMD, are also vying for a slice of the lucrative pie. Huawei, the Chinese telecom giant, has developed its own AI chips, such as the Ascend series, which have been gaining popularity among Chinese customers. According to some reports, Baidu, the Chinese internet giant, recently placed a large order for Huawei's AI chips.

AMD, another US-based technology company, is also planning to launch its AI chip for the Chinese market, the MI300 accelerator, which was announced in August this year. AMD's CEO, Lisa Su, said that the MI300 chip was designed specifically for the Chinese market and that it would comply with the US export rules. AMD aims to challenge NVIDIA's dominance in the AI market with its MI300 chip, which is expected to offer superior performance and efficiency.

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