Focus on the BIG picture.
Wednesday, Jan 15, 2025
Outside the box.
Nvidia’s AI chips are cheaper to rent in China than US
Supply of processors helps Chinese start-ups advance artificial intelligence technology despite Washington’s restrictions
The cost of renting cloud services using Nvidia’s leading artificial intelligence chips is lower in China than in the US, a sign that the advanced processors are easily reaching the Chinese market despite Washington’s export restrictions.
Four small-scale Chinese cloud providers charge local tech groups roughly $6 an hour to use a server with eight Nvidia A100 processors in a base configuration, companies and customers told the Financial Times. Small cloud vendors in the US charge about $10 an hour for the same set-up.
The low prices, according to people in the AI and cloud industry, are an indication of plentiful supply of Nvidia chips in China and the circumvention of US measures designed to prevent access to cutting-edge technologies.
The A100 and H100, which is also readily available, are among Nvidia’s most powerful AI accelerators and are used to train the large language models that power AI applications. The Silicon Valley company has been banned from shipping the A100 to China since autumn 2022 and has never been allowed to sell the H100 in the country.
Chip resellers and tech start-ups said the products were relatively easy to procure. Inventories of the A100 and H100 are openly advertised for sale on Chinese social media and ecommerce sites such as Xiaohongshu and Alibaba’s Taobao, as well as in electronics markets, at slight mark-ups to pricing abroad.
China’s larger cloud operators, such as Alibaba and ByteDance, known for their reliability and security, charge double to quadruple the price of smaller local vendors for similar Nvidia A100 servers, according to pricing from the two operators and customers.
After discounts, both Chinese tech giants offer packages for prices comparable to Amazon Web Services, which charges $15 to $32 an hour. Alibaba and ByteDance did not respond to requests for comment.
Four small-scale Chinese cloud providers charge local tech groups roughly $6 an hour to use a server with eight Nvidia A100 processors in a base configuration, companies and customers told the Financial Times. Small cloud vendors in the US charge about $10 an hour for the same set-up.
The low prices, according to people in the AI and cloud industry, are an indication of plentiful supply of Nvidia chips in China and the circumvention of US measures designed to prevent access to cutting-edge technologies.
The A100 and H100, which is also readily available, are among Nvidia’s most powerful AI accelerators and are used to train the large language models that power AI applications. The Silicon Valley company has been banned from shipping the A100 to China since autumn 2022 and has never been allowed to sell the H100 in the country.
Chip resellers and tech start-ups said the products were relatively easy to procure. Inventories of the A100 and H100 are openly advertised for sale on Chinese social media and ecommerce sites such as Xiaohongshu and Alibaba’s Taobao, as well as in electronics markets, at slight mark-ups to pricing abroad.
China’s larger cloud operators, such as Alibaba and ByteDance, known for their reliability and security, charge double to quadruple the price of smaller local vendors for similar Nvidia A100 servers, according to pricing from the two operators and customers.
After discounts, both Chinese tech giants offer packages for prices comparable to Amazon Web Services, which charges $15 to $32 an hour. Alibaba and ByteDance did not respond to requests for comment.
