• A band of Chinese chip producers, spearheaded by Huawei, are receiving government funding to build high-bandwidth memory semiconductors to serve as a stand-in for Nvidia’s (NASDAQ: NVDA) AI technology, according to a report by The Information.
  • The high-bandwidth memory, or HBM, chips are necessary to build advanced GPUs that power AI and the Chinese consortium plans to develop their own by 2026.
  • Current U.S. sanctions prevent China from importing cutting-edge AI GPUs from U.S. companies such as Nvidia.

A consortium of Chinese chip companies led by Huawei Technologies and supported by the national government hopes to produce High-bandwidth memory (HBM) semiconductors that are a crucial component of AI chips by 2026, according to a report published in The Information on Thursday.

About project

The project, which began last year and involves Huawei and Fujian Jinhua Integrated Circuit, a memory chip manufacturer subject to US sanctions, is an attempt by China to offer domestic alternatives to Nvidia’s AI chips, according to the report.

The group will endeavour to customize its memory chips to Huawei-designed AI processor chips and supporting motherboard components. It also depends on other Chinese chip manufacturers and packaging technology developers.

As a kind of internal rivalry, the Huawei-led consortium constructed at least two HBM production lines using memory chips from various manufacturers, according to The Information. It also mentioned that Huawei would probably be the main purchaser of the HBMs.

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Reasons for project

China has been heavily investing in its chip industry to lessen its reliance on imported technology and get around US export restrictions that prevent it from obtaining cutting-edge semiconductors, such as Nvidia’s artificial intelligence chips.

HBM chips are produced using American chip technology that Huawei is not allowed to access as part of the curbs, even though they are not directly subject to U.S. export restrictions.