China weighs allowing ByteDance and Alibaba to buy new Nvidia chips: Here’s why

On Sunday, the Chinese government suggested it would allow domestic companies like ByteDance and Alibaba to buy a new Nvidia chip built for high-end professional computers, according to a report by The Information.

To that end, China’s Ministry of Industry and Information Technology recently asked major domestic technology companies including ByteDance and Alibaba to submit their crucial plans to purchase Nvidia’s RTX PrO 5500 chips.

A statement from Nvidia’s spokesperson reads: “US firms continue to be restricted by a combination of outdated US export controls, which ​cover gaming ​products released ⁠nearly a half a decade ago, and China's own limits on ​US imports.”

The ministry told some Chinese companies the government intends to authorize the procurement, adding that some industry executives expect the RTX PRO 5500 chip to avoid US expert limitations.

ByteDance is targeting roughly about one million units driven by local demands that exceeds what Huawei and other domestic suppliers can provide while Nvidia plans to ship 500,000 units quarterly shipments this December.

Nonetheless, this underscores a projected relaxation of measures highlighting China’s compute shortage as it attempts to balance domestic self-reliance milestones; analysts view this major development as a positive signal for Nvidia amid ongoing US expert controls.