China’s AI Tiger Roars

China has established several conditions to enable growth of AI-chip companies. Many Chinese AI unicorns and other companies are serving the data-center and edge markets.

Anand Joshi

China is developing numerous AI chips and ranks second only to the US in nurturing startups for this market. Its government is prioritizing semiconductor design and manufacturing as part of its “Made in China 2025” plan. This initiative aims to boost the production of high-value products and to domestically manufacture 70% of the nation’s chips by 2025. To accomplish these goals, however, China must catch up with Taiwan and the US in advanced manufacturing technology, high-performance-processor design, and AI software.

Buoyed by funding from the government and local investors, more than 50 Chinese companies have developed AI chips. These products cater to every application, from the data center to robotics, automotive, and smart cameras. Chinese consumers and enterprises are investing in and experimenting with AI technology, boosting domestic demand for AI processors.

Most Chinese AI companies have chips in production, and some have reached their third or fourth generation. Many are also enjoying multi-billion-dollar valuations. China’s AI chip companies focus on selling into the domestic market and employ various architectures (CPU, GPU, FPGA, and proprietary). Their goal is to monetize in the near term; hence, a few, if any, companies attend to the long term by pursuing innovative approaches such as neuromorphic computing.