ByteDance will create its own AI chips

Nvidia, the world leader in artificial intelligence chips, is facing dangerous new competition. ByteDance, the company that owns the world-famous TikTok app, is speeding up production of its own chips, hoping to mass produce them by 2026. It is currently developing an advanced 5-nanometer artificial intelligence chip with U.S. firm Broadcom, and even TSMC (Taiwan Semiconductor Manufacturing Corp.), which also serves Nvidia, is expected to start working with ByteDance and Broadcom’s project as well.

According to Reuters, the chip will not violate existing US chip export restrictions. However, it is unclear exactly when the chip will begin production at TSMC, as it is currently in the design phase and production is not expected to begin this year.

This year, ByteDance purchased over 200,000 chips from Nvidia, crying over $2 billion. They now intend to produce, in conjunction with TSMC, several hundred thousand prototype chips that are expected to be much cheaper than the US chips.

In the US, ByteDance has been the subject of great concern from some US regulators who believe its status as a China-based company poses a national security threat to Americans who use its TikTok video app. In April, U.S. President Biden signed a bill that could ban TikTok as early as next year if TikTok does not sever its ties with ByteDance and China.

China has also introduced some bans and changes of its own. The country has reportedly decided to phase out the use of US Intel and AMD chips in its government computers and telecommunications networks. Last year, China also banned chips from the US firm Micron, saying they posed a risk to national security.