This is the outcome of the US sanctions against China. According to Huang Renxun's interview, NVIDIA's market share in China has dropped from a peak of 95% to nearly zero, and NVIDIA has been completely excluded from China.

Moreover, Huang Renxun stated that although US policymakers hope to win the AI competition, current policies often harm China but also hurt the US more severely. He emphasized, "China is the second-largest computing device market globally, and it's a mistake for the US not to be involved."

The US has used NVIDIA as its trump card in the Sino-US AI competition, continuously restricting the export of high-performance AI chips to China, so NVIDIA must bear the cost of participating in the Sino-US AI rivalry.

In 2018, Huawei launched the Ascend 910, the most advanced AI chip at that time. However, this progress was halted due to the comprehensive US sanctions. From 2018 onwards, under the implicit support of the US government's technology protection and market access policies, NVIDIA gradually built an almost monopolistic global AI ecosystem with its "chip + software" collaborative strategy.

This period coincided with the critical stage where AI moved from laboratories to industrial applications. NVIDIA's GPUs became an indispensable "computing engine" for training complex AI models due to their powerful parallel computing capabilities. More importantly, NVIDIA's CUDA software platform deeply integrated hardware performance with the developer ecosystem, creating a high technical barrier and user stickiness. This "hardware-based, software-driven" model made most AI research institutions and companies around the world rely on NVIDIA's technology stack.

At the time, this ecosystem seemed impregnable. NVIDIA CEO Huang Renxun often expressed strong confidence in public, even boldly stating, "The Chinese AI market cannot do without NVIDIA," and even stepped on China's red line regarding the Taiwan issue.

Moreover, it was revealed that NVIDIA's specially designed H20 chip has remote shutdown features and other hardware backdoors, directly threatening data sovereignty. As a result, the state required Alibaba and others to explain the use of NVIDIA chips!

However, Huang Renxun never expected that Huawei, which had been sanctioned by the US, would once again rise up. From Ascend 910B to Ascend 910C, Huawei, despite process limitations, managed to match the performance of NVIDIA's H100 chip. When the Chinese market had AI chips more advanced than NVIDIA's H20, and when the US continued to strengthen sanctions against Chinese AI companies, our AI industry chain would make a choice to abandon NVIDIA and choose Chinese AI chips.

When Huang Renxun saw the breakthroughs in Chinese AI chips, he had to admit, "Even without NVIDIA, China will find its own solution."

But it was already too late, because the US sanctions had led China to make its choice, and NVIDIA was destined to be abandoned.

NVIDIA fears the core logic that "the most feared thing for a monopoly is not competitors, but the shaking of its monopolistic position." Because China is building its own AI ecosystem, and is starting to export it to other countries, such as Malaysia has purchased Chinese Ascend chips.

For NVIDIA, this is not the worst. The worst is that NVIDIA's AI chips may face production difficulties, because of China's rare earth ban. For logic chips below 14nm, rare earth elements are needed, and they require approval from China.

In modern semiconductor manufacturing, especially for logic chips below 14nm, rare earth elements are an indispensable "industrial vitamin." From the precision lenses and laser systems of lithography machines, to the film deposition and chemical mechanical polishing inside the chips, and finally to the packaging, rare earth elements like cerium, lanthanum, and neodymium permeate every key link in the production of high-end chips. Without them, advanced manufacturing processes would have to stop.

It's like making a top dish; just having cooking skills and a stove isn't enough. Missing a few key spices, the flavor just won't be right. Now, the world's largest "spice" supplier says, "We need to follow the rules."

China's new rare earth policy is not simply a blanket ban on exports, but a precise "pointing" approach. It stipulates that any key rare earth materials required for the production of logic chips below 14nm must go through approval. This directly hits the most sensitive part of the global semiconductor industry.

Want to bypass it? Not easy. The entire rare earth industry chain, from the upstream mineral separation and purification to the downstream application of high-end materials, is under China's absolute control. Others might have mines, but turning ore into high-purity materials usable in chip factories involves technical barriers and capacity that are all controlled by China. Globally, only China has the capability to mass-produce and purify high-purity rare earths.

NVIDIA CEO Huang Renxun is regretting losing the Chinese market, but he may now face a more difficult problem: how to ensure his AI chips can be smoothly produced from the factory.

This is the outcome of the US sanctions against China. For the US, its sanctions only serve as a catalyst for China's accelerated breakthroughs, ultimately causing severe damage to itself. Think about it, in recent years, which of the US's sanctions against China have succeeded? From semiconductors to precision instruments, from aerospace to artificial intelligence, the list is long enough to circle the White House three times. But upon closer inspection, each one has given China's technological tree a boost.

Whether it's the Beidou navigation system, the Chinese space station, or China's supercomputers, or even the fully domestic 7nm chip industry chain (all software, equipment, tools, and technologies from sand to chips are domestically produced), China has achieved success. These American high-tech enterprises, originally monopolizing the Chinese market, have permanently left the Chinese market under US sanctions against China, and the vast profits have returned to Chinese enterprises.

Looking back at the US itself, in just five months of 2023, American chip companies had laid off over 120,000 employees. And this number continues to grow. Boeing lost Chinese aircraft orders, leading to a stock price drop, and farmers' soybeans were rotting in warehouses, relying solely on government subsidies. By 2024, the US's regulatory measures had caused a loss of $130 billion in the market value of American chip companies, while stimulating China to surpass the US in the number of patents in 5G, artificial intelligence, and new energy fields.

From this perspective, we really should thank the US.

Original: https://www.toutiao.com/article/7562483804732916266/

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