China’s ByteDance is working with U.S. chipmaker Broadcom ( AVGO ) to develop an advanced AI processor, two sources familiar with the matter said, a move that would help the TikTok owner ensure a sufficient supply of chips. high level between US-China tensions.
The 5-nanometer chip — a custom product known as an application-specific integrated chip (ASIC) — would comply with U.S. export restrictions and the manufacturing job would be outsourced to Taiwan’s TSMC ( TSMC34.SA ) , the sources added.
There has been no publicly announced collaboration on chip development between Chinese and US companies involving 5nm or more advanced technology since Washington introduced export controls on the latest semiconductors in 2022. US-China deals in the sector have generally do with much less sophisticated technology.
Top-notch chips
ByteDance’s tie-up with Broadcom, an existing business partner, would help lower procurement costs and ensure a steady supply of higher-end chips, said the sources, who declined to be identified because of the sensitivity of the matters. semiconductor in China.
However, TSMC is not expected to start production of the new chip this year, they said. One of them said that while design work is well underway, tapeout – which marks the end of the design phase and the start of production – has not started.
ByteDance and Broadcom did not respond to repeated requests for comment. TSMC declined to comment.
Like many global tech firms, ByteDance has launched a big push into generative artificial intelligence, but the company and its Chinese peers face a much more limited supply of AI chips than their overseas counterparts.
Nvidia
Nvidia’s ( NVDA ) cutting-edge chips are out of reach because of U.S. export controls aimed at hindering advances in AI and supercomputers by China’s military. Competition for American chips developed specifically for the Chinese market, as well as those from rival Huawei, one of the few Chinese makers of AI accelerators, is fierce.
ByteDance and Broadcom have been business partners since at least 2022. The Chinese firm bought the US company’s Tomahawk 5nm high-performance switch chip as well as its Bailly switch for AI computing clusters, Broadcom said in public statements. .
Providing AI chips is essential for ByteDance to make its algorithms more powerful. In addition to TikTok and the Chinese version of the short video app called Douyin, ByteDance operates a number of popular apps including a ChatGPT-like chatbot service called Doubao, which has 26 million users.
To support its AI push, ByteDance has been stockpiling Nvidia chips, according to a separate person briefed on the matter.
That includes the A100 and H100 chips available before the first round of U.S. sanctions began, as well as the A800 and H800 chips that Nvidia made for the Chinese market but were also later restricted, the person said, adding that ByteDance allocated 2 billion dollars for Nvidia acquisitions. chips last year.
ByteDance also bought Huawei’s Ascend 910B chips last year, two separate sources with knowledge of the matter said.
Bytedance currently has hundreds of semiconductor-related jobs posted, including 15 for ASIC chip designers, according to checks on its website.
It has also poached senior people from other Chinese AI chip firms, according to one of the sources with direct knowledge of the matter.
(Reporting by Eduardo Baptista in Beijing and Reuters staff; Editing by Miyoung Kim and Edwina Gibbs)
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