Key facts
- ByteDance is exploring partnerships with Chinese chip startups including Iluvatar CoreX, Biren Technology, MetaX, Iluvatar CoreX, Moore Threads Technology, and Enflame Technology.
- The company has already purchased tens of thousands of AI processors from Shanghai-based Iluvatar.
- ByteDance is reportedly developing its own custom AI CPUs, potentially using Arm or RISC-V designs.
- ByteDance is also partnering with InnoStar Semiconductor for memory technology.
- The U.S. Department of Commerce has imposed export restrictions on advanced semiconductors to China since October 2022, impacting Nvidia's ability to supply certain chips.
- Nvidia has modified its product line for the Chinese market with downgraded chips like the A800, H800, H20, and B20.
Chinese technology giant ByteDance is accelerating its adoption of domestic semiconductors for artificial intelligence workloads, seeking to reduce its reliance on U.S. chipmakers like Nvidia. The company is reportedly considering several tier-two Chinese chip manufacturers, including Biren Technology, MetaX Integrated Circuits, Iluvatar CoreX, Moore Threads Technology, and Enflame Technology, for its cloud infrastructure needs.
ByteDance has already made significant purchases, acquiring tens of thousands of AI processors from Shanghai-based Iluvatar CoreX at a favorable price. The company is also engaged in discussions with other domestic chipmakers for potential future orders. Furthermore, ByteDance is reportedly developing its own custom AI CPUs, inspired by Groq's language processing units, and is partnering with InnoStar Semiconductor for memory technology. This move aligns with ByteDance's ongoing development of its SeedChip AI accelerator with TSMC.
The strategic pivot towards domestic silicon is driven by U.S. export controls imposed since October 2022, which have restricted Nvidia's ability to supply advanced AI chips to China. Nvidia has had to offer modified versions, such as the A800, H800, H20, and B20, with reduced performance to comply with regulations. This geopolitical squeeze creates uncertainty for Chinese tech firms, making planning capacity difficult. ByteDance is finalizing a deal for at least 50,000 AI inference GPUs from Iluvatar CoreX, valued at an estimated $150 million, and is also in talks with Baidu's chip unit Kunlunxin.