The US has been placing export curbs on high-end chips to China throughout 2023. Credit: Getty Images/ William_Potter.

China’s AI companies will not be able to keep up with their US rivals in 2024 due to its choked access to high-end chips, research company GlobalData has predicted. 

Throughout 2023, US export bans have halted China’s access to key chips needed for AI development, such as graphics processing units (GPUs).

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As the computing power necessary to train AI models grows at a rapid pace, Chinese companies will likely be held back by less powerful GPUs, according to GlobalData’s Thematic Intelligence: Tech, Media, & Telecom Predictions 2024 report. 

China will be able to break through in certain industry-specific AI and tech hardware applications, GlobalData said. 

However, by the time the country has began to develop its own high-end chips at the same frequency as the US, large-scale rivals like OpenAI would have advanced too much to catch up with, according to the report.

“Despite China putting a lot of investment into developing AI, the US currently holds 13 of 15 world-leading AI research centres,” GlobalData said. 

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“Furthermore, the US draws in talent from around the world, whereas China relies on its domestic supply,” it added.

In November, leading US chip maker NVIDIA warned investors of a forthcoming decline in sales following US export controls to China on high-end AI chips. 

The leading chip maker reported a major increase in profits in November, reporting sales in the past three months of $18.1bn, an increase of 206% on the same period last year. Profits also increased from $680m for the period last quarter to $9.8bn this quarter. 

The news followed the Biden administration’s calls for restrictions on overseas use of the most advanced US-made AI chips.

The overall AI market will be worth $909bn by 2030 having grown at a compound annual rate of 35% between 2022 and 2030, according to GlobalData research director Josep Bori.