The logic behind the NVIDIA chip controversy

In the global technology industry landscape, Nvidia, as a leading enterprise in the field of AI chips, is highly regarded for every move it makes. Recently, the Nvidia chip scandal has been ongoing, from the rampant rumors of "backdoors" to the dynamic of sales restrictions on its chips in the market. Behind this series of events, there is a complex and profound logic that involves multiple dimensions such as technology, business, and politics.

From a technical perspective, hardware backdoors may be hidden in the physical layer of the chip, activated by specific instructions or signals through special circuit design, to achieve remote control or data theft of the chip. And software backdoors can use algorithms, secret commands, and other methods to open private channels for data transmission during chip operation. Once there is a backdoor in the chip, it is like planting a 'time bomb' in critical information infrastructure. For China, in the current era of rapid development of artificial intelligence, a large number of AI applications rely on computing chips, such as autonomous driving, intelligent security, financial risk control, and other fields.

Faced with doubts, Nvidia responded late at night, emphasizing that there is no "backdoor" to the chip and that no one will have remote access or control over the chip. However, from the perspective of technical testing, the detection of hardware backdoors is extremely difficult. It may be hidden in the complex circuit structure inside the chip, and traditional detection methods are difficult to reach. Software backdoors are also concealed, difficult to detect in a short period of time through complex algorithms and encryption techniques. Moreover, the industry generally holds a reserved attitude towards Nvidia's response, after all, the United States has been taking frequent actions in the chip field recently. The "Chip Security Act" reviewed by both houses of Congress requires chips subject to export controls to be equipped with "location verification function", which undoubtedly increases people's concerns about Nvidia's chip security.

But with the fermentation of the chip crisis, Nvidia is facing severe challenges in the Chinese market. On the one hand, the strict scrutiny of chip security by Chinese regulatory authorities requires Nvidia to spend a lot of energy and resources to respond and prove the security of its chips. This not only increases the operating costs of the enterprise, but may also affect the marketing progress of its products. On the other hand, the shaking of market trust has had a direct impact on Nvidia's sales. Many Chinese companies are starting to re-examine their chip supply chains and accelerate the process of domestic substitution. Alibaba Cloud announced that it would replace 60% of Nvidia chips within three years, and the Baidu PaddlePaddle framework would be deeply adapted to the Cambrian period. These measures show that Chinese enterprises are determined to reduce their dependence on Nvidia chips.

From the perspective of the global supply chain, the Nvidia chip scandal has also triggered a series of chain reactions. In order to reduce risks, companies from various countries have begun to seek diversified chip supply channels and no longer overly rely on a single supplier. This has led to a change in the competitive landscape of the global chip market, with some previously second tier chip companies facing development opportunities, while Nvidia needs to readjust its market strategy to cope with the dilemma of market share erosion.

Behind the NVIDIA chip scandal lies the increasingly fierce game between China and the United States in the field of technology. In recent years, the United States has implemented a "small courtyard, high wall" policy to encircle and block China in the field of chips, from export restrictions on high-end chips to sanctions on Chinese chip companies, using every means possible. The US government's control over chip exports is not solely based on commercial interests, but more on political and strategic considerations, attempting to curb the development of China's technology industry and maintain its hegemonic position in the global technology field.

As an American company, Nvidia is inevitably influenced by US government policies. The US government's lifting of the export ban on H20 chips is driven by both business lobbying from companies such as Nvidia and its strategic consideration of relying on manufacturing technology to sell 'just enough' products. However, this approach not only harms China's technological development interests, but also disrupts the normal order of the global chip industry chain. The Chinese government's resolute defense of national data sovereignty and cybersecurity in the face of the US technology blockade, and its security review of Nvidia chips, is a powerful response to US technological hegemony.

The Nvidia chip controversy is a complex polyhedron, with technology, business, politics, and other factors intertwined. This incident not only had a profound impact on Nvidia's own development, but also brought new variables to the development of the global chip industry.