The US had previously put a trade barrier on NVIDIA and AMD from exporting chips to China. The national security experts believe that exporting advanced chips to China might threaten the national security of the region and give its rival an unfair advantage. However, in an unprecedented move, the US has allowed both tech companies to export chips to China, but with a strong catch.
NVIDIA and AMD can now export their advanced chips to China
To counter the trade barrier put up by the US, NVIDIA later developed its “less powerful” version of the chipset. This chip was designed to be equipped with inferior hardware compared to the one available in the US. It was done so that the company could at least sell those units to China. However, the US soon banned the export of it as well.
Advanced Micro Devices (AMD) also tried to have a continued conversation with the state department to get some relaxation. However, it did not work as well. But now, in a surprising event, the state has allowed both chip manufacturers to export their advanced chips to Beijing. This comes after both companies agreed to share 15% of the total profit earned with the government.
Both tech giants will pay 15% of the earned profit to the US government
The US government has granted a license to NVIDIA and AMD to sell their advanced chipsets to China. But there’s a catch: both the chipmakers will have to pay 15% of the total earned profits to the government. AMD, to be more specific, will have to share the profit earned from the sale of its MI308 chip.
Although the government has officially licensed the chipmakers to trade with China, there are officials who are not happy with this decision. Some top national security and past government officials have objected to the move, claiming that it could potentially risk the security of the US. And that this could endanger the nation’s economic and military edge in artificial intelligence.
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