Nvidia Asks Data Center Operators to Cut Ties with Chinese Clients: FT

Nvidia has asked data center operators that deal with the company to reduce transactions with Chinese clients, the British newspaper Financial Times (FT) reported on November 3 (local time).

The FT evaluated this move as an effort to make it even more difficult for China to catch up as the competition for artificial intelligence (AI) hegemony between the United States and China intensifies.

Citing five sources familiar with the matter, the FT reported that Nvidia recently notified data center clients over the past few months that they must sell at least 51 percent of their services in the future to non-Chinese entities.

This is a restrictive measure that did not exist previously.

These guidelines were reportedly communicated verbally through Nvidia's sales organization and regional managers rather than in writing.

The policy applies not only to customers in Asia but worldwide, and it is limited to new contracts rather than existing ones.

In an official statement regarding the matter, Nvidia stated that data centers and clouds built with U.S.-made chips serve as the foundation enabling U.S. AI companies to compete in the global market, and that expanding domestic infrastructure worldwide has been a longstanding U.S. policy.

Chinese technology companies, which have faced difficulties directly acquiring advanced U.S.-made chips, have previously secured the computing power needed for AI model training by renting overseas data centers. However, with Nvidia's new measure, even this is expected to become much harder moving forward.

The U.S. administration of Donald Trump is cracking down on intermediaries that have fueled the black market for Nvidia AI chips within China while also trying to block Chinese companies from accessing them by renting overseas data centers.

The FT pointed out that the cloud service industry has been placed in a difficult position due to Nvidia's request.

A company official in Singapore told the FT, "It is difficult to find enough non-Chinese customers outside the U.S.," adding, "If the measure is strictly enforced, it will definitely deal a blow to our business."

The newspaper analyzed that Chinese tech firms are counted as the largest customers for data centers in regions such as Southeast Asia.

(Photo: AP, Yonhap News)
※ Please note: This article was translated by AI and may contain errors.