Nvidia orders data centre clients to reduce China exposure

US tech giant Nvidia has instructed its data center partners to reduce their involvement with Chinese customers, according to a report by the Financial Times. The new policy applies exclusively to future contracts, not to existing agreements, the report stated, citing unnamed sources.

The restriction requires Nvidia's cloud computing clients to allocate at least 51% of their services to non-Chinese firms, the FT reported. Nvidia declined to confirm or deny the report to AFP, but issued a statement emphasizing the importance of American infrastructure for cloud computing. The company stated that data centers and clouds built on American chips are essential for global competition.

The US government has long promoted the development of cloud computing on American infrastructure, encouraging companies to expand their business worldwide. Nvidia's statement echoed this policy, asserting that the US cannot lead the AI race if its competitors rely on foreign-made chips. Consequently, the company's model and application layers would also be influenced by foreign-made components.

When asked about the report, a spokeswoman for China's foreign ministry, Mao Ning, stated that she was unaware of the information. She reiterated her country's stance on maintaining a fair, transparent, and non-discriminatory business environment for companies from all nations, including China.

China and the United States are engaged in a fierce competition for supremacy in the rapidly evolving field of artificial intelligence (AI). In recent months, the two nations have engaged in a dispute over allegations of AI technology theft and security concerns. As the world's most valuable company, Nvidia plays a crucial role in the global effort to build data centers filled with specialized computer chips and other hardware that power AI systems.