Nvidia CEO says China ‘will win’ AI race with US — and then quickly corrected himself
With the AI race between the United States and China heating up, Nvidia CEO Jensen Huang made a statement claiming the latter is set to win it. Speaking to Financial Times on the sidelines of the publication's Future of AI Summit, Huang reportedly stated, "China is going to win the AI race." While the context and the reasoning behind the statement are unclear, it rattled AI enthusiasts across the West. Now, taking to X, Nvidia has released another statement to soften the tech CEO's remarks.
According to an FT report, Huang implied that China is set to pull ahead of the U.S. in the AI race. According to a snippet available online, Huang implied that the lower energy costs in China will be a major factor in doing so. After the statement made waves in the media, Nvidia released another statement from the CEO on X, which read, “As I have long said, China is nanoseconds behind America in AI. It’s vital that America wins by racing ahead and winning developers worldwide."
According to 24/7 Wall St, Huang's statement comes against the backdrop of the U.S. not allowing Nvidia to sell its high-end chips to its rival. China’s access to advanced AI chips, produced by Nvidia, remains a flashpoint in its tech rivalry with the two countries as both nations vie for supremacy in cutting-edge computing and artificial intelligence. Following a meeting with President Donald Trump in July, Huang seemed to ease some curbs on the sale of Nvidia's chips to China. Under a new plan, Nvidia and its competitor, AMD, had agreed to pay the U.S. government 15% of their Chinese revenues from sales of AI processors. However, since the deal, Beijing shut Nvidia out of the market to conduct a national security review of its chips, and Huang previously stated that Nvidia's market share had been reduced to zero in China, according to CNBC.
Another reason that is partially available in the Google search results of the FT report is the lower energy costs in China. Citing another FT report, Reuters wrote that China has increased subsidies for some of the country's largest data centers, to help them cut energy bills by up to half. According to the report, local governments in China have also increased incentives to help homegrown tech giants such as ByteDance, Alibaba, and Tencent. China appears to run cutting-edge AI software with chips that are comparatively less powerful than Nvidia's chips. This has helped Chinese programmers to build AI software inexpensively, and the boost from subsidies and incentives adds to that. The Chinese government also provides incentives to companies for developing chips domestically.
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