Even the US intelligence community acknowledges that they have no proof that Alice Huang spied on former Nvidia CEO Jensen Huang. Shanghai-based business analyst Shaun Rein tells Open The Magazine that the Nvidia story has nothing to do with spies, but with efforts to make money.
Open The Magazine:
Now, speaking to Open, Shaun Rein, US-born founder and managing director of the China Market Research Group, who advises Fortune 500 and leading Chinese companies, argues that Jensen Huang didn’t need anyone to goad him into doing business with China even after restrictions were put in place by the US government on selling extremely high-quality chips that his company makes to China amidst the ongoing chip war. “It’s very clear that Jensen Huang wanted to sell chips, even inferior chips, to the Chinese. He has said that he is losing 18 billion US dollars a year of sales to the China market. As a businessman, he wants to make money,” says Rein, a Harvard University alumnus.
Rein’s scepticism about charges of Chinese espionage stems from other reasons, too. The Shanghai-based consultant adds, “Second, he is not a fear-mongering businessman like many China hawks are, and he doesn’t necessarily view China as a competitor or evil. So, it’s in his best interests to sell chips to the Chinese.” Nvidia had developed a downgraded GPU called H20 (a modified version of H100) specifically for the Chinese market to beat export restrictions.
Rein adds, however, that the Chinese government actually doesn’t want to rely on Nvidia chips anymore, because it feels that even if it can buy them now, at some point, Donald Trump or another president can weaponise technology again and ban the export of Nvidia chips to Chinese companies. “So China is pushing hard to focus on indigenous innovation and the use of Chinese competitors like Cambricon Technologies (dubbed China’s Nvidia), Hua Hong Semiconductor, SMIC (Semiconductor Manufacturing International Corporation), the largest contract semiconductor manufacturer (foundry) in mainland China, Moore Threads Technology Co. Ltd (a Chinese company that specialises in graphics processing unit (GPU) design) and so on,” Rein explains.
He, however, hastens to add that it is quite plausible that many Chinese companies that are profit-driven and are not looking at national security have a very different view from Beijing on whether or not they want to use Nvidia chips. “And so it is very possible that large Chinese companies like an Alibaba would be willing to rent the use of Nvidia chips in data centres that are housed in Malaysia or in Singapore. Some might also even be willing to smuggle chips into mainland China to put into their own data centres on the mainland.”
Which is why, along the lines of several independent journalists and technology analysts, he feels that it is important to differentiate between the motives and wants of for-profit private Chinese companies that are publicly traded and the Chinese government. Rein says he wants to underscore that even the United States is saying that it doesn’t have proof that she was a spy—as news reports from CNN and other news outlets suggest. In fact, amidst sensationalised reporting, US Attorney General Todd Blanche said the Department of Justice was yet to determine whether Huang was a Chinese spy.
More Nvidia stories in Open The Magazine.
Shaun Rein is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers’ request form.
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