China urges local cos to stay away from Nvidia's chips

Beijing is stepping up pressure on Chinese companies to buy locally produced artificial instead of Nvidia Corp. products, part of the nation's effort to expand its semiconductor industry and counter US sanctions, Bloomberg reported.

Chinese regulators have been discouraging companies from purchasing Nvidia's H20 chips, which are used to develop and run AI models, according to people familiar with the matter. The policy has taken the form of guidance rather than an outright ban, as Beijing wants to avoid handicapping its own AI startups and escalating tensions with the US, said the people, who asked not to be identified because the matter is private intelligence chips The move is designed to help domestic Chinese AI chipmakers gain more market share while preparing local tech companies for any potential additional US restrictions, the people said. The country's leading makers of AI processors include Cambricon Technologies Corp. and Huawei Technologies Co. Earlier this year, Beijing also told local electricvehicle makers to procure more of their supplies from local chipmakers, part of its campaign to reach self-sufficiency in critical technologies.