Recent reports from the Financial Times reveal a shift in how Chinese AI companies handle US sanctions. Instead of purchasing hardware outright, many now rely on rented cloud capacity to access the same high-end compute resources previously restricted by export controls. This approach allows Chinese firms to continue training and running neural networks without owning the physical equipment directly.
Late last year, Washington extended its embargo to include equipment used for chip fabrication and components for assembling supercomputers that power neural-network training. Nvidia A100 GPUs, among the most common devices in these systems, became a focal point of the restrictions. The effect was a disruption of traditional procurement channels for Chinese AI developers.
Citing iFlytek and SenseTime, the Financial Times notes that Chinese AI companies are rapidly adapting to the new reality. When hardware purchases were blocked, they turned to cloud providers with access to the same Nvidia A100 GPUs. iFlytek reports that renting capacity can be marginally more expensive than owning hardware, yet the flexibility and speed to scale can justify the cost.
The piece also points out a notable expansion of cloud-service providers in China since autumn 2022. Many of these firms operate with private backing and some level of government support to ensure a steady supply of compute resources. In many cases, AI companies have even formed arrangements to purchase services directly from providers, effectively acquiring the necessary capacity rather than the hardware itself.
In the United States, the stance appears more permissive toward this model. The Financial Times explains that American cloud providers initially exercised caution about a surge of demand from China. After evaluating the situation, they concluded that such partnerships could fall within existing export-control frameworks, avoiding a clear violation of current rules.
A last note in the report mentions a separate commercial development: Xiaomi products on AliExpress began appearing in Russia at prices comparable to the iPhone 14 Pro, illustrating ongoing cross-border tech-market dynamics during this period.