The parent company of TikTok, ByteDance, is renting advanced AI chips from Nvidia and using them on U.S. soil, exploiting a legal loophole to circumvent restrictions on the export of AI chips to China.
Due to national security concerns, the U.S. government prohibits the direct sale of AI chips like Nvidia’s A100 and H100 to Chinese companies. However, the restrictions do not prevent Chinese companies from renting these chips for use within the United States. ByteDance, reportedly, is renting servers with Oracle chips.
Last month, ByteDance had access to over 1,500 H100 chips and several thousand A100 chips through the agreement with Oracle. Other Chinese tech giants, such as Alibaba and Tencent, are also exploring similar options, either renting from U.S. providers or establishing data centers in the U.S.
The artificial intelligence race between the U.S. and China continues to intensify, and it appears that major players are willing to obtain AI chips by any means necessary. While the U.S. tries to curb its rival’s progress with restrictions, the situation resembles a game of whack-a-mole that won’t stop China from achieving significant milestones in the field of artificial intelligence.