US Considers New Restrictions on China's Access to AI Memory Chips
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[1]
US mulling restrictions to keep Samsung, SK hynix, Micron from supplying HBM chips to China: Bloomberg
Flags of China and U.S. are displayed on a printed circuit board with semiconductor chips, in this illustration picture taken Feb. 17, 2023. Reuters-Yonhap The United States is considering a new measure meant to prevent Samsung Electronics, SK hynix and Micron Technology from supplying high-bandwidth memory (HBM) chips to Chinese firms, Bloomberg reported Wednesday. Citing people familiar with the matter, the news outlet said that the U.S. is weighing the unilateral restrictions on China's access to artificial intelligence (AI) memory chips and equipment capable of making those chips "as soon as next month," though no final decision has been made. If rolled out, the measure would cover HBM2 and other advanced chips, including HBM3 and HBM3E, Bloomberg said. HBM chips are used to run AI accelerators. Samsung, SK hynix and Micron dominate the global HBM market, according to the outlet. The new restrictions are part of a broader package that also includes sanctions against more than 120 Chinese firms and fresh limits on various types of chip equipment, with carveouts for Korea, Japan and the Netherlands. This means equipment measures would primarily target U.S. companies, Bloomberg said. The measure came as strategic competition between the U.S. and China is heating up over technological leadership, maritime security, trade and other fields. (Yonhap)
[2]
US Weighs New Restrictions on China's Access to AI Memory Chips
The US is considering unilateral restrictions on China's access to AI memory chips and equipment capable of making those semiconductors as soon as next month, a move that would further escalate the tech rivalry between the world's biggest economies. The measure is designed to keep Micron Technology Inc. and South Korea's leading memory chipmakers SK Hynix Inc. and Samsung Electronics Co. from supplying Chinese firms with so-called high-bandwidth memory, or HBM, chips, according to people familiar with the matter, who emphasized that no final decision has been made. The three firms dominate the global HBM market.
[3]
US mulls new curbs on China's access to AI memory chips, Bloomberg News says
The U.S. Department of Commerce declined to comment, while the companies did not immediately respond to Reuters requests for comment. If enacted, the new rule would capture HBM2 and more advanced chips including HBM3 and HBM3E, as well as the tools required to make them, the report said, adding that no final decision on the restrictions has been made. HBM chips are needed to run AI semiconductors such as those sold by market leader Nvidia and aspiring competitor AMD. Micron will be largely unaffected as the chipmaker has held back from exporting its HBM products to China after Beijing banned its memory chips from critical infrastructure in 2023, the report said. It was unclear what authority the U.S. would use to restrict the South Korean firms, the report said. This could include the foreign direct product rule, or FDPR, which lets the U.S. impose controls on foreign-made products that use some amount of American technology, according to the report. SK Hynix and Samsung extensively utilize technology from American firms such as Applied Materials and Cadence Design Systems. While the new measures would curb direct sales of HBM chips to Chinese companies, it's unclear whether selling high-end memory chips bundled together with AI accelerators to China would be permissible, the report said. (Reporting by Arsheeya Bajwa in Bengaluru; Editing by Devika Syamnath)
[4]
US may consider limiting China's access to AI memory chips: report
The Biden administration is discussing whether to further limit China's access to memory chips used for artificial intelligence and the equipment used to make those processors, Bloomberg reported. A decision could come as soon as August, the news outlet added, citing people familiar with the matter. If it happens, it could impact Micron (NASDAQ:MU), Samsung (OTCPK:SSNLF) and SK Hynix from supplying Chinese companies with high-bandwidth memory. The ruling could impact HBM2, HBM3 and HBM3E chips, the news outlet added. Micron would largely be unaffected, as the company has not sold its HBM chips in China after the Chinese government banned the use of its memory chips from critical infrastructure in 2023. Micron was also under placed investigation by the country for a cybersecurity review. In November, China's commerce minister suggested the country was open to Micron expanding its presence in the Chinese market amid a thawing between the U.S. and China. SK Hynix and Samsung use products from Cadence Design Systems (CDNS) and Applied Materials (AMAT) and others to design and create their chips. Micron said in February that it had started mass production of its HBM3E offering for use in Nvidia's (NVDA) GPUs. Micron, Samsung, SK Hynix did not immediately respond to a request for comment from Seeking Alpha. More on Micron and Samsung Samsung Electronics Co., Ltd. (SSNLF) Q2 2024 Earnings Call Transcript Samsung Electronics Co., Ltd. 2024 Q2 - Results - Earnings Call Presentation Micron: Strong Prospects For Secular And Cyclical Growth Are Coming Together Samsung sees strong demand for HBM chips in H2 due to AI applications Samsung Electronics GAAP EPS of KRW1419.00, revenue of KRW74.07T
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The Biden administration is contemplating new restrictions on China's access to advanced AI memory chips. This move could significantly impact the global semiconductor industry and US-China tech relations.
US Mulls New Curbs on China's AI Chip Access
The Biden administration is reportedly considering imposing new restrictions on China's access to advanced artificial intelligence (AI) memory chips. This potential move, aimed at maintaining the United States' technological edge, could have far-reaching implications for the global semiconductor industry and US-China relations in the tech sector 1.
Targeting High-Bandwidth Memory Chips
The focus of these potential restrictions is on high-bandwidth memory (HBM) chips, which are crucial components in advanced AI systems. These chips are designed to process large amounts of data quickly, making them essential for training and running sophisticated AI models 2.
Impact on Major Chip Manufacturers
If implemented, these restrictions could significantly affect major chip manufacturers, including South Korea's Samsung Electronics and SK hynix. Both companies are key players in the global semiconductor market and have substantial business interests in China 3.
Ongoing US-China Tech Tensions
This development is part of a broader pattern of increasing tensions between the United States and China in the technology sector. The Biden administration has been actively working to limit China's access to cutting-edge semiconductor technology, viewing it as a matter of national security 4.
Potential Global Market Repercussions
The proposed restrictions could have significant repercussions on the global semiconductor market. China is a major consumer of advanced chips, and limiting its access could disrupt supply chains and potentially lead to retaliatory measures 1.
Industry Response and Concerns
Major chip manufacturers and industry stakeholders are closely monitoring the situation. There are concerns about the potential impact on global sales and the complex nature of international semiconductor supply chains 3.
Balancing Act for South Korean Companies
South Korean chip makers, in particular, find themselves in a delicate position. They must navigate the competing demands of their largest market (China) and their key security ally (the United States). This situation underscores the complex geopolitical landscape of the global tech industry 3.
Next Steps and Potential Timeline
While the Biden administration is still in the process of considering these new restrictions, sources suggest that a decision could be made in the coming weeks or months. The exact nature and scope of the potential restrictions remain unclear, adding to the uncertainty in the industry 2.
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