Nvidia Restricts Chinese Access to Cloud Computing Services
Nvidia instructs global data center partners to limit Chinese customers to under 50% of cloud computing sales.
2 min read
Nvidia has directed its global data center partners to limit Chinese customers to less than half of their cloud computing business, according to sources. The Financial Times reports that Nvidia’s sales force and regional teams have been verbally instructing partners to sell at least 51% of cloud computing services to non-Chinese companies. This new rule, which was never put in writing, applies globally and affects only future contracts, leaving existing leasing agreements unaffected.
Pre-emptive Move to Avoid Criticism
Sources describe the move as pre-emptive, aimed at preventing criticism from U.S. lawmakers and other critics of Nvidia’s approach to China. Washington has been working to close off routes that allow intermediaries to build a black market for Nvidia chips in China and to stop Chinese companies from accessing advanced chips through overseas leasing deals.
Strengthening Controls Over AI Chip Distribution
Nvidia has also taken steps to tighten control over the distribution of its AI chips in Asia. The company has established a new whitelist of verified customers, reducing the number of authorized clients by over fifty percent. This move is part of an effort to prevent the illegal smuggling of advanced AI processors into China, where U.S. export restrictions have banned the sale of such chips since 2022.
Verification Process and Business Impact
The remaining companies on the approved list have undergone rigorous compliance inspections to confirm their legitimacy. Nvidia’s verification process includes sending field staff to inspect customer data centers, conducting contract verification procedures, and interviewing end users to authenticate business operations. One Singapore-based cloud provider warned that strictly enforcing the new threshold would be difficult, as it would be hard to find enough non-Chinese clients outside the U.S.
CEO and Spy Allegations
Nvidia CEO Jensen Huang has been the subject of scrutiny after a Chinese spy he developed a relationship with was identified. Authorities were investigating whether Alice Huang was helping China obtain restricted Nvidia AI chips before surveillance revealed her close relationship with Jensen Huang. Nvidia has clarified that these interactions are routine and that Megaspeed is an ordinary regional customer.
Source: Breitbart
