China's Initiative to Support AI Start-ups Facing Chip Restrictions

China is taking steps to support its artificial intelligence start-ups facing chip restrictions due to the US tech giants hogging AI-training computing resources. At least 17 city governments, including Shanghai, have pledged to provide 'computing vouchers' to subsidize AI start-ups facing rising data center costs as crucial chips become scarce. Industry insiders revealed that internet companies cancelled contracts, prompting them to 'hog the GPUs for themselves,' leading to measures such as limiting the rental of Nvidia's GPUs and reserving majority stockpiled AI processors. The move comes after the Biden administration tightened China's access to crucial AI chips. China is also set to roll out a subsidy program for AI groups using domestic chips and has been creating an alternative to Big Tech's data centers and cloud services. One government official mentioned that the vouchers would reduce AI companies' computing costs by around 40 to 50% if they opt for government-run data centers. Beijing has approved at least 40 LLMs for public use while maintaining strict oversight over AI application. The developments include centralizing the distribution of computing power using state-run trading platforms. China's initiative aims to lower energy resource consumption and power AI workloads through dedicated data center clusters. This move is essential to address both cost barriers and the scarcity of resources faced by AI start-ups.