China summons Nvidia over H20 chip backdoor concerns

Beijing has summoned Nvidia to address concerns that its H20 AI chips contain backdoors, following a US proposal to add tracking capabilities to advanced semiconductors sold overseas. This marks China’s latest countermeasure in the escalating tech rivalry, as both nations increasingly weaponize national security concerns around AI and semiconductor technologies.

What you should know: The Nvidia meeting comes after the Trump administration recently reversed a Biden-era ban, allowing the company to export H20 chips to China.

• Jensen Huang’s company had lost billions in sales due to the previous restrictions, making China’s approval crucial for Nvidia’s business.
• Huang recently completed a high-profile visit to China where he was “greeted like a rock star,” contrasting with other Big Tech CEOs who have avoided public appearances in Beijing.

The bigger threat: Chinese scientists are developing multiple strategies to counter Elon Musk’s Starlink satellite network, which Beijing views as a potential military tool that could be used against China in future conflicts.

• Current sabotage options include targeting supply chains, but the civilian applications of Starlink may pose an even greater long-term challenge to countries that tightly control internet access.
• Today’s Starlink connections require noticeable satellite dishes, but telecommunications companies are researching ways to achieve satellite internet without GPS requirements.

Why this matters: Within several years, satellite internet may be accessible directly on cell phones, even indoors, fundamentally changing how governments can control information flow.

• In such a scenario, the only way to cut off internet access would be to physically target satellites, meaning countries would need to attack Musk’s infrastructure.
• This creates a strategic dilemma for China, given Tesla’s significant production and sales operations in the country and Musk’s relatively cordial relations with Beijing compared to other tech leaders.

The big picture: China’s national security interests and competition with the US are now superseding personal relationships with tech industry luminaries, signaling a new phase where geopolitical considerations trump individual diplomatic ties.