At the beginning of this month, the United States urgently intercepted 24 NVIDIA chips that TuSimple was going to send from the United States to Australia, believing that these high-performance GPUs may flow to China; At the same time, a few days ago, Biden released news that he would ask the US cloud computing platform to check whether it has been used by Chinese customers to train artificial intelligence, believing that this will help Chinese companies indirectly obtain large computing power and bypass chip sanctions.
The whole world is paying attention, to what extent is the chip war between China and the United States? The United States continues to sacrifice the so-called "ultimate sanctions" combination punch, what is the effect, and China's efforts to break through the "stuck neck" will tear the breakthrough from the **?
part.1
Back on December 12, 2023, the House Committee on U.S.-China Strategic Competition released a 53-page bipartisan report. In terms of export controls, the report recommends "swift and comprehensive control" of AI, quantum, biotechnology and other emerging technologies, and asks the U.S. Department of Commerce to develop a new cloud computing end-use rule that would close the loophole for Chinese companies to remotely access controlled technologies. Finally, on January 29, 2024, the U.S. Department of Commerce's Bureau of Industry and Security issued new regulations to regulate U.S. cloud computing platforms. The new rules are expected to take effect after the deadline for public comment on April 29.
Chen Jianqing, former senior chief engineer of SK hynix in the United States:
Because now high-end chips can no longer enter China, in fact, many Chinese companies are currently using cloud services in the United States, such as Amazon, Microsoft's cloud computing, in fact, to a certain extent, it is equivalent to the use of high-performance AI chips, because overseas clouds are also computing power aggregation platforms, so Chinese enterprises in this way, in fact, still use the most advanced AI computing power. The next step for the U.S. Department of Commerce is whether it can tell if the companies that use cloud computing are the ones that are actually restricted on its Entity List. ”
Cloud computing is the provision of computing resources in the form of on-demand services over the Internet. With the popularization of the Internet and the continuous development of information technology, cloud computing has gradually become an important choice to reduce costs and improve efficiency in the semiconductor industry. At present, there are five major open source cloud computing platforms, including Amazon, Microsoft, and Google, which provide computing services for enterprises all over the world.
Controlling the use of cloud computing platforms is another new measure in the United States to restrict the development of Chinese artificial intelligence. In the global AI wave, China is not far behind. According to incomplete statistics, in the new round of generative AI tide, 106 large models have appeared in China, forming a "regional race" centered on many large cities such as Beijing and Shanghai, and manufacturers that are deeply engaged in artificial intelligence have emerged. Restrictions on cloud computing could create problems for the developing Chinese artificial intelligence industry.
Chen Jianqing, former senior chief engineer of SK hynix in the United States:
If this restriction is actually implemented, the computing power of many Chinese enterprises will be greatly affected if they are deployed on the cloud. If it is not on the Entity List or is not on the Restricted List, its impact is not significant. First of all, it has its own cloud platform, and has bought a lot of Nvidia cards, which is one of the largest card-holding companies in China. Because the business is not restricted by the United States, it can use cloud computing and cloud services without restrictions. So it ultimately comes back to the business itself and whether it is on the restricted entity list. ”
American scholars have pointed out that the use of artificial intelligence requires a "trinity" of data, algorithms, and computing power. In terms of data and algorithms, China and the United States are almost on par, but in terms of computing power, the United States still has a relatively large advantage. Even under the most optimistic scenario, it will take another 5 years for China to design competitive chips and the software ecosystem around them, and much longer to manufacture them in large quantities within the country.
Bao Ran, Vice Chairman of Zhongguancun Modern Information Consumption Application Industry Technology Alliance:
In fact, China's total computing power has always ranked second in the world, and the United States ranks first. Computing power is divided into 4 types, one is general-purpose computing CPU-based; One is based on intelligent computing GPU and GPGPU; There's also edge computing power and other computing power. Among them, the most important thing used for artificial intelligence is intelligent computing power, and intelligent computing power needs to buy chips, who to buy? The first is the American chip company Nvidia, and the second is AMD. So the gap is an acceleration expansion. ”
part.2
With the launch of ChatGPT, generative AI has sparked a "gold rush" in the global tech circle. In this round of science and technology, GPU is the key chip for the development of artificial intelligence. And the American chip company Nvidia, which participated in the early stage of the generative AI revolution, has eaten up the dividends. Nvidia's GPUs almost monopolize the AI chip market with an 80% market share.
As early as the beginning of last year, the chip game between China and the United States will enter the deep water area.
Wang Xiaosong, professor at the School of Economics, Chinese University:
The deep water area should be in the field of AI chips, since the launch of ChatGPT, there has been a blowout in the field of AI chips, and related industries have made great progress, so the future AI is not only very important, but also has a very strong development prospect, who occupies the commanding heights of AI chips, who will be able to obtain more wealth. ”
The friction between China and the United States began during the Trump administration, and after Biden took office, the competition between the two sides in the field of key technologies has become more intense.
In 2022, the United States introduced the "CHIPS and Science Act" to directly curb the development of China's semiconductor industry from the legal level. In the same year, the U.S. Department of Commerce's Bureau of Industry and Security issued measures such as banning the sale of advanced process chips to China and banning the export of American talents to China, which was interpreted by the outside world as a "declaration of war".
Bao Ran, Vice Chairman of Zhongguancun Modern Information Consumption Application Industry Technology Alliance:
More and more new local companies are being added to the entity sanctions list, and the biggest restriction for these companies is that they can't find talent. Many of the original outstanding talents have actually studied and worked in the United States for a long time, and many of them have settled in the United States. These measures restrict the introduction of high-end talents, what does this industry rely on? It still depends on talent. ”
In 2023, these measures will be further escalated. On October 17 last year, the U.S. Department of Commerce's Bureau of Industry and Security issued a 295-page new rule that further restricted the sales of advanced semiconductors by U.S. companies.
At the same time, the new rules for the export ban on AI chips have once again refreshed the "bottom line", from the previous performance computing power and bandwidth restrictions to the latest computing power density and performance restrictions, behind the numerical changes indicate that the United States has launched a comprehensive suppression of China's AI chips. These regulations hit the seven inches of NVIDIA, the king of AI tide.
Taiwanese political and economic commentator Tsai Zhengyuan:
It was a big blow to Nvidia, because Nvidia's market capitalization is very large, and it is a terrible number to drop almost 20%. In 2022, its most famous 5nm-class AI chip products, A100 and H100, have been put under strong control, and China will not be able to buy them. At this time, Nvidia tried to design A800 and H800 down-gauge chips specifically for China, which is slightly looser than the regulations, but it is enough for China. When it made the A800 and H800 to be sold to Chinese mainland, it was considered opportunistic by the US Department of Commerce in 2023, so it specifically ordered that the A800 and H800 be banned together. ”
Bao Ran, Vice Chairman of Zhongguancun Modern Information Consumption Application Industry Technology Alliance:
The United States has proposed to use the actual computing power density to 'stuck the neck' standard, rather than specific to a model that has been produced, which is to govern NVIDIA. Because Nvidia has designed a castrated version and a reincarnated version of the chip, the United States ** is also a headache, so the upgrade countermeasures are calculated according to the computing power density. If you look at the density of computing power, Nvidia will suffer a big loss, and its main RTX4090 graphics card chip in the consumer market cannot be sold in the mainland. ”
Obviously, Nvidia is not willing to be tied down by the United States. In fiscal year 2023, revenue from the Chinese market (including China, Hong Kong, and Taiwan) accounted for 47% of NVIDIA's global revenue. After the October 17 ban, there were widespread fears that Nvidia would lose $5 billion in Chinese orders. To this end, Nvidia actively lobbied the United States** in an attempt to find room for conciliation. Raimondo and Huang debated how to develop export guidelines to China in this context — Huang advocated deregulation and Raimondo remained tough.
On December 2, 2023, Raimondo singled out Nvidia at the annual Defense Forum, criticizing its development of chips that are slightly lower than the export restrictions set by the United States, and expressing that the Commerce Department may raise export control standards at any time.
But shortly after, on December 6, Huang said in an interview in Singapore that we were preparing for regulation when it came out a year ago. Therefore, when a new product line encounters regulation again, we can quickly adapt the new product to regulatory compliance. We will supply these products to our Chinese partners.
This round of gambling began to bear fruit a few days later, and the United States obviously did not want to completely block Nvidia's shipments to China. On December 11, 2023, U.S. Secretary of Commerce Raimondo revealed that the United States is communicating with Nvidia about exporting AI chips to China, and Nvidia "can, will, and should provide AI chips to China, because most AI chips will be commercialized." But she also declared that Nvidia would not be allowed to export "the most sophisticated and highest-processing power" AI chips in case China uses them to train cutting-edge AI models.
After that, Nvidia announced that chips such as the H20 designed for China will be mass-produced in the second quarter of 2024, but the performance has shrunk.
Bao Ran, Vice Chairman of Zhongguancun Modern Information Consumption Application Industry Technology Alliance:
For the world, the most cutting-edge GPUs and GPGPUs are very expensive, and an advanced GPU basically starts at tens of thousands of dollars. To build an AI training center of a slightly similar scale, at least 10,000 pieces are required, which is equivalent to a minimum of several hundred million US dollars, and only China can have such a large regional market with financial resources and motivation. That is, China, a late-developing market, has a strong willingness to catch up and development motivation, and a country that has the will to resist US hegemony, will invest in the race of artificial intelligence at all costs. So with such a clear and accessible market, Nvidia will definitely not give up, which is a real dollar. ”
The escalation ban on October 17, 2023 is also known as the "ultimate sanction". Earlier, on September 22, the U.S. Department of Commerce issued final "guardrail" rules on the CHIPS and Science Act to prevent $52 billion of its semiconductor manufacturing and research funds from being used by China or other countries deemed "a threat to the United States." The "guardrail" rule prohibits entities receiving U.S. chip funding from substantially expanding semiconductor manufacturing capacity in "countries of concern" for 10 years, and prohibiting them from substantially expanding semiconductor manufacturing capacity in local cutting-edge and advanced facilities in "countries of concern" for 10 years.
In the second half of 2023, this series of updates to the original restraining orders and bills also indicates the escalation and deepening of the chip war.
Bao Ran, Vice Chairman of Zhongguancun Modern Information Consumption Application Industry Technology Alliance:
There are also military factors that the United States is so anxious about now that it is 'stuck in the neck', and the current military operations are all supported by chips behind it. Therefore, it is afraid that after the cutting-edge chip technology flows into China, it will not be used militarily by China, and we stand in the position of the United States, and its concern is reasonable. So why didn't it use dumping to suppress China's semiconductor industry at its roots, but adopted a more simple and crude way, I think the military considerations are greater than the economic considerations. ”
part.3
The 2023 China-US summit in San Francisco seems to have opened a door in the relationship between the two countries, but this door is still locked in the field of chip warfare. In 2022, the U.S. ban claimed to curb the possibility of China entering the next generation, and the escalation in 2023 further stumbled China's progress towards artificial intelligence. This year, China's Huawei breakthrough has made Americans' hearts palpitate, and they have also set their sights on a wider range of fields, and the semiconductor dispute between the two countries is still in the ascendant, and even gradually extending downward.
At the beginning of 2024, Dutch lithography giant ASML issued an announcement saying that the export licenses that had been approved for two models of DUV lithography machines in 2023 were suddenly revoked.
Over the past year, ASML has been supplying lithography machines to Chinese customers, including the NXT:2000i and more advanced DUV models. As for the more advanced EUV lithography machines that produce chips of 7nm and below, ASML is still unable to supply Chinese customers**. According to ASML's financial report released on January 24, 2024, China has become the company's second largest market.
Regarding the United States' pressure on the Netherlands to stop exporting lithography machines to China, spokesman Wang Wenbin said at a regular press conference on January 2 that China has always opposed the United States' generalization of the concept of science and technology and coerced other countries to engage in a technological blockade against China under various pretexts.
At the same time, the U.S. Department of Commerce said it would launch an investigation into the U.S. semiconductor industry's ** chain and defense industry to reduce "the most important risk posed by China." Unlike the previous "restriction on China's chips", this "reverse restriction" will focus on the use and procurement of traditional chips made in China by key U.S. industries to assess the degree of dependence of its semiconductor chain on Chinese chips.
Bao Ran, Vice Chairman of Zhongguancun Modern Information Consumption Application Industry Technology Alliance:
According to the International Semiconductor Association, as of the third quarter of 2023, especially in the third quarter of 2023, global semiconductor sales fell 11% year-on-year and 1% quarter-on-quarter. This is a global statistic, but the Chinese market is rising, both year-on-year and month-on-month. ”
In the face of the decline in the global market, the answer given by semiconductor industry insiders is a recession and insufficient demand. However, the Chinese market is rising against the wind at this time, and the reasons for this are worth investigating.
Bao Ran, Vice Chairman of Zhongguancun Modern Information Consumption Application Industry Technology Alliance:
The main leaders of the Global Semiconductor Association are commenting that we are optimistic about the long-term development of the semiconductor market due to the strong performance of demand and consumption in the local market in China. The demand side includes the demand of the industrial chain and the demand of the consumer market, the so-called demand of the industrial chain is that many of the world's factories are in China, whether it is the integration of computer equipment factories, or the integration of new energy vehicles, CPU, GPU, MCU and so on. In this case, we see that the performance of the Chinese market is 'unique on this side of the scenery', and at the same time, there is also a point that China's production capacity is getting stronger and stronger at the mature node. ”
As early as July last year, Bloomberg issued an article pointing out that China produced a large number of mature process chips, sounding the alarm in the United States and Europe. In the field of chip manufacturing above 28 nanometers, China's chips already have market competitiveness that cannot be underestimated. China's electric vehicle industry, which is overtaking in corners, has also created demand for mature process chips. According to the U.S. Automotive Policy Council, a car needs to use at least more than 1,000 chips. Western countries are even worried that China may dump mature process chips into the global market, which in turn will squeeze foreign competitors. Just as China's solar industry has conquered the world before.
Bao Ran, Vice Chairman of Zhongguancun Modern Information Consumption Application Industry Technology Alliance:
If we seize the huge low-end market, the total scale is not small, the total profit level should not be low, and a virtuous ecological cycle will be laid. Rome wasn't built in a day, and advanced GPUs weren't built in a day. NVIDIA's general-purpose GPU is unsurpassed, especially in the field of artificial intelligence training and inference, it was only a graphics card company at the beginning, and the development of graphics acceleration cards has accumulated more and more customers using NVIDIA's development kits, NVIDIA's ecology and interfaces, so that its moat is getting wider and wider, and the barriers are getting higher and higher, and it is difficult for latecomers to catch up. So we give priority to our own or give priority to exporting our own low-end products, 'first to be a grandson and then a grandfather', isn't it all like this in business? ”
part.4
From the perspective of the world, the three major wafer foundry giants - TSMC, UMC, and GF, have mature processes accounting for about 74% of the total production capacity. Among them, UMC and GF have long withdrawn from the competition of advanced processes and focused on the expansion of mature processes; TSMC's mature process still accounts for the majority of production capacity. At the same time, mature processes are still the main force in the current global capacity expansion.
In recent years, China has invested a lot of money in the semiconductor industry, among which the fastest development is the mature process-related industries.
Chen Jianqing, former senior chief engineer of SK hynix in the United States:
China's chip companies are currently analog and small components-based enterprises, and now overcapacity and inventory reduction are very big and urgent problems to be solved, which is a difficult time and an opportunity. After the integration, there will be some companies with strong capabilities, which may become chip giants in the next cycle. In the next stage, how can Chinese chip companies improve their technical capabilities and truly enter the global chip industry system, so that a Chinese chip company that can compete with American chip giants can emerge. ”
It is for this reason that the United States wants to press the signs of catching up in advance. As early as the middle of last year, Biden was collecting information and considering corresponding measures. By the end of last year, the US side had launched a further investigation.
Bao Ran, Vice Chairman of Zhongguancun Modern Information Consumption Application Industry Technology Alliance:
I think the U.S. Department of Commerce is also afraid of this because of the new counter-sanctions. China's semiconductor companies took advantage of this time window to meet their own domestic demand and achieve substitution. In addition, China's products are very cost-effective, with China's products for a long time, will form the ecosystem and moat and market barriers of China's semiconductor industry, at that time, the revitalization of American semiconductors, I am afraid it will encounter great trouble. ”
Throughout 2023, the most surprising thing for the United States is Huawei's breakthrough. Under the encirclement and interception of the United States, the 7-nanometer chip in Huawei's new machine has become an "unspeakable secret" in the chip war between China and the United States.
Bloomberg said at the end of 2023 that Huawei's revenue soared 9% in 2023, capping off a dramatic year for the Chinese tech giant. On February 6, 2024, some foreign media said that SMIC is laying a new production line in Shanghai, and will put into production 5nm chips designed by Huawei for ** mobile phones.
But in any case, Huawei's breakthrough has put the United States under pressure and raised its vigilance. From restricting the development of cutting-edge artificial intelligence, to verifying the industrial chain, and restricting the procurement of mature process chips, the chip game between China and the United States is intensifying, and the future is still unpredictable.
The chip war between the United States and China has been considered by some commentators to be using the traditional blocking idea to block the competition in the intelligent era. The latest front of the chip war between the two countries is probably "RISC-V", simply put, this is an open-source basic technology that can help various chips process computing tasks, and American politicians are promoting a blockade of China, and some Silicon Valley executives think that this is like because Chinese can read the English book of nuclear **, so simply ban the English alphabet to block China. The United States continues to seek to use all-round means to jam China's computing power.
Producer: Song Yang.
Choreographer: Shasha.
Editor: Wang Jinjie.