Nvidia AI chips are cheaper to rent in China than in the USA, due to steady supplies from small cloud vendors.
Availability of Nvidia Chips on the Market
The US decision to restrict the sale of Nvidia processors to China in 2022 did not completely stop the flow of processors into the country. Small traders from Hong Kong, Japan, and other nearby countries continue to purchase chips from the US and smuggle them into China.
Prices on Chinese and American Markets
According to the Financial Times, Chinese startups charge about $6 an hour for access to a server with eight Nvidia A100 processors while the same service costs $10 in the US. Most of these chips enter China through the black market and are advertised on social media and platforms like Xiaohongshu and Taobao at a much smaller markup than abroad.
Nvidia's Control
Nvidia claims it controls its distributions through a network of authorized partners who comply with US export restrictions. The company states it takes action if violations are found.
The availability of Nvidia AI chips on the black market in China enables lower rental prices for servers with such processors compared to American competitors. This shows that US restrictions have not fully halted chip supplies to China.
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