Nvidia and AMD have reached a unique agreement with the U.S. government to share 15% of revenue from certain chip sales in China. This decision is linked to the procurement of export licenses.
Details of the Agreement
The agreement covers Nvidia's H20 chip and AMD's MI308, which have been tailored for the Chinese market in line with previously established export restrictions. U.S. officials stated that this revenue-sharing deal is a condition for obtaining export licenses for these chips. Nvidia confirmed the existence of the agreement, stating that it follows U.S. rules for participation in global markets.
Negotiation Process
The negotiations for the agreement were complex. In April, the Trump administration announced it would block H20 exports to China due to concerns about AI technology transfer. After Nvidia's CEO Jensen Huang met with Donald Trump in June, the administration reversed its decision. However, export licenses were issued only last week after the 15% revenue agreement was finalized.
Criticism and Implications
The agreement has sparked criticism from national security experts, who warned that the H20 chip could accelerate AI development in China and potentially aid its military. Nvidia rejected these claims, calling them misguided and insisting the H20 is unsuitable for military use. The deal also reflects current trade negotiations between Washington and Beijing.
This agreement between Nvidia, AMD, and the U.S. government opens a new chapter in leveraging export policy as a mechanism to restrict technology and generate revenue from it. Given the context of global competitiveness and security, further developments in this area will be closely monitored.
