Alibaba's New AI Chip Unveiled: Key Specifications Comparable to H20
71 comments
·September 17, 2025rich_sasha
rsynnott
> because apparently (?) no one else can make chips like them
No, that's not really why. It is because nobody else has their _ecosystem_; they have a lot of soft lock-in.
This isn’t just an nvidia thing. Why was Intel so dominant for decades? Largely not due to secret magic technology, but due to _ecosystem_. A PPC601 was substantially faster than a pentium, but of little use to you if your whole ecosystem was x86, say. Now nvidia’s ecosystem advantage isn’t as strong as Intel’s was, but it’s not nothing, either.
(Eventually, even Intel itself was unable to deal with this; Itanium failed miserably, largely due not to external competition but due to competition with the x86, though it did have other issues.)
It’s also notable that nvidia’s adventures in markets where someone _else_ has the ecosystem advantage have been less successful. In particular, see their attempts to break into mobile chip land; realistically, it was easier for most OEMs just to use Qualcomm.
BrawnyBadger53
The article seems to only depict it being similar to the H20 in memory specs (and still a bit short). Regardless, Nvidia has their moat through cuda, not the hardware.
FooBarWidget
What gave you the impression that it's "without too much sweat"? They sweated insanely for the past 6 years.
They also weren't starting from scratch, they already had a domestic semiconductor ecosystem, but it was fragmented and not motivated. The US sanctions united them and gave them motivation.
Also "good" is a matter of perspective. For logic and AI chips they are not Nvidia level, yet. But they've achieved far more than what western commentators gave them credit for 4-5 years ago. And they're just getting started. Even after 6 years, what you're seeing is just the initial results of all that investment. From their perspective, not having Nvidia chips and ASML equipment and TSMC manufacturing is still painful. They're just not paralyzed, and use all that pain to keep developing.
With power chips they're competitive, maybe even ahead. They're very strong at GaN chip design and manufacturing.
fearmerchant
China's corporate espionage might have surpassed France at the winners podium.
anothernewdude
Flagship? No, H20 was their cut down chip they were allowed to sell to China.
cedws
Apparently DeepSeek’s new model has been delayed due to issues with the Huawei chips they’re using. Maybe raw floating point performance of Chinese chips is competitive with NVIDIA, but clearly there’s still a lot of issues to iron out.
elp
I'm sure there are LOTS of issues that need to be addressed, but the demand for the chips are so high that the incentives are overwhelmingly in favor of this continuing. If the reported margins on the Nvidia chips are as high as the claims make it out to be (73+% ??) this will easily find a world wide market.
It was also frustratingly predictable from the moment the US started trying to limit the sales of the chips. America has slowed the speed of Chinese AI development by a tiny number of years, if that, in return for losing total domination of the GPU market.
smokefoot
I mean, I don’t know how long the NVIDIA moats can hold. With this much money at stake, others will challenge their dominance especially in a market as diverse and fragmented as advanced semiconductors.
That’s not to say I’m brave enough to short NVDA.
mark_l_watson
I think that NVIDIA’s moat is the US government. Remember our government’s efforts to prevent the use of Huawei cell infrastructure in Europe and around the world?
I am a long time fan of Dave Sacks and the All In podcast ‘besties’ but now that he is ‘AI czar’ for our government it is interesting what he does not talk about. For example on a recent podcast he was pumping up AI as a long term solution to US economic woes, but a week before that podcast, a well known study was released that showed that 95% of new LLM/AI corporate projects were fails. Another thing that he swept under the rug was the recent Stanford study that 80% of US startups are saving money using less expensive Chinese (and Mistral, and Google Gemma??) models. When the Stanford study was released, I watched All In material for a few weeks, expecting David Sack’s take on the study. Not a word from him.
Apologies for this off-topic rant but I am really concerned how my country is spending resources on AI infrastructure. I think this is a massive bubble, but I am not sure how catastrophic the bubble will be.
mrktf
As long as only TMSC is only top performance chip producer and it is possible to reserve all it manufacturing capacity for one two clients the NVIDIA will hold without problem...
My opinion, the problems for NVIDIA will start when China ramp up internal chip manufacturing performance enough to be in same order of magnitude as TMSC.
dworks
"Your margin is my opportunity" as someone said. Certainly Google must have plans to sell its chips externally with this much up for grabs?
xbmcuser
google has already started offering its TPUs to other neocloud providers
null
notfried
If CUDA isn't that strong of a moat/tie-in and Chinese tech companies can seemingly reasonably migrate to these chips, why hasn't AMD been able to compete more aggressively with nVidia on a US/global scale when they had a much longer head start?
brookst
1. AMD isn’t different enough. They’d be subject to the same export restrictions and political instability as Nvidia, so why would global companies switch to them?
2. CUDA has been a huge moat, but the incentives are incredibly strong for everybody except Nvidia to change that. The fact that it was an insurmountable moat five years ago in a $5B market does not mean it’s equally powerful in a $300B market.
3. AMD’s culture and core competencies are really not aligned to playing disruptor here. Nvidia is generally more agile and more experimental. It would have taken a serious pivot years ago for AMD to be the right company to compete.
chii
AMD probably don't have chinese state backing, presumably, where profit is less of a concern and they can do it unprofitably for many years (decades even) as long as the end outcome is dominance.
eunos
Because Cuda moat in China is wrecked artificially by political reason rather than technical reason
dworks
Most chipmakers in China are making or have made their new generation of products CUDA-compatible.
pixelesque
Note also that today China has told its tech companies to cancel any NVIDIA AI chip orders and not to order any more:
https://www.ft.com/content/12adf92d-3e34-428a-8d61-c91695119...
MaoSYJ
“grey market” smugglers gonna keep working on it
rapsey
Chinese tech dominance is inevitable and anything the US tries to do to contain it will just hasten the inevitable.
glimshe
We've heard that about Japan in the 80s and the Soviet Union a couple of decades earlier. While China is a mighty competitor, they also have structural problems they don't hesitate to sweep under the rug.
The jury is out there about whether China can take a meaningful lead in any major technological field the US and Europe are actively invested in.
sschueller
> they also have structural problems they don't hesitate to sweep under the rug
I have the feeling the US is creating giant problems by putting massive tariffs on allies and pretending they don't hurt themselves.
mark_l_watson
I think that The Plaza Accord (1985) ended up crippling Japan economically. The Plaza Accord is an excellent example of my country benefiting from military and economic power - unfortunately, the days of us getting away with this kind of behavior are probably over.
That said, we will probably get away with bullying Europe for a while longer. Canada seems to be standing up to USA pressure fairly well. Europe needs to do the same, and they will probably eventually get there.
xbmcuser
Japan was destroyed by US as it was dependent and subservient to US as a market as well with US army and navy all over Japan. They unlike China could not say fuck off
loudmax
Unfortunately for the US, the administration is also furtively generating brand new structural problems.
JimDugan
EVs, Batteries, Civilian Drones, Quantum Communications, Robotics (Industrial & Consumer), Clean Energy (Solar, Wind, Nuclear tech).
Have you been living under a rock the past couple of years?
smokefoot
Chinese semiconductor dominance is not imminent and US containment has been somewhat effective. I don’t think that will hold on a generational timeline, but it will be hard to overcome.
brookst
You don’t think the export controls on Nvidia chips accelerated Chinese investment in ML processors and therefore their independence -> dominance in the space?
rapsey
Semiconductor lead is inevitably going to fall within the decade. So will the military hopes of ever protecting Taiwan.
papageek
Tries to do to contain.. like letting u.s. companies pump trillions into the Chinese economy?
pjmlp
See Huawei and Xiaomi everywhere else outside US, or how encryption standards went down in the days of PGP book with the printed code.
ajsnigrutin
Let's be fair, US export controls are one of the reasons that China is ramping up research/development of such tech (especially AI now).
Considering the amount of sanctions coming from US (and EU), it's no wonder that "the rest of the world" is trying to "build their own" <thing> now.
rapsey
Yep that is what I meant.
narrator
Dialectical Materialism much?
torginus
There's a very important point made in the article - with recent export controls, domestic Chinese firms don't need to beat Nvidia's best, but only the cut-down chips cleared for Chinese export.
jarym
The AI race is like the nuclear arms race. Countries like China will devote an inordinate amount of resources to be the best - it may take a year or two, but in the grand scheme of things that is nothing.
And NVIDIA will lose its dominance for the simple reason that the Chinese companies can serve the growing number of countries under US sanctions. I even suspect it won't be long before the US will try to sanction any allies that buy Chinese AI chips!
WhereIsTheTruth
> And NVIDIA will lose its dominance
They are vendor locking industries, i don't think they'll loose their dominance, however, vendor locked companies will loose their competitiveness
TSiege
This is not true and a lot of Nvidi’s chips are smuggling into the country. There’s a ton of domestic pressure to be the leading chip producers. It’s part of China’s strategic plan called Made in China 2025
h1fra
If CUDA is nvidia's moat, which has basically created a monopoly, how long until there is an anti-monopoly trial against them in EU or even in the US?
MonkeyClub
This conveniently coincides with China banning purchases of Nvidia AI chips:
tw1984
Several years ago, whenever some Chinese engineers dared to propose using some Chinese parts, the challenges he/she had to face is always "who is going to be responsible if it is not reliable enough for its quality?"
Nowadays, whenever some Chinese engineers dared to propose using some American parts, the challenges he/she had to face is always "who is going to be responsible if it is not reliable enough for its supply?"
aurareturn
US government f'ed over Nvidia's China market dominance in order to help OpenAI, Google, Anthropic, xAI.
China shouldn't be buying H20s. Those are gimped 3 year old GPUs. If Nvidia is allowed to sell the latest and greatest in China, I think their revenue would jump massively.
jarym
One of these headlines in the next few months will spark a US market selloff greater than what we saw on the initial DeepSeek release.
I believe about 1000 S&P points down - to just above the trade war lows from April.
Can someone ELI5 this to me? Nvidia has the market cap of a medium-sized country precisely because apparently (?) no one else can make chips like them. Great tech, hard to manufacture, etc - Intel and AMD are nowhere to be seen. And I can imagine it's very tricky business!
China, admittedly full of smart and hard working people, then just wakes up one day an in a few years covers the entire gap, to within some small error?
How is this consistent? Either:
- The Chinese GPUs are not that good after all
- Nvidia doesn't have any magical secret sauce, and China could easily catch up
- Nvidia IP is real but Chinese people are so smart they can overcome decades of R&D advantage in just s few years
- It's all stolen IP
To be clear, my default guess isn't that it is stolen IP, rather I can't make sense of it. NVDA is valued near infinity, then China just turns around and produces their flagship product without too much sweat..?