The world of cloud computing is witnessing a fascinating development in China, where local cloud service providers (CSPs) are offering AI hardware rentals at remarkably low prices. This stark contrast to pricing in the United States is driven by the ready availability of high-end AI GPUs, particularly NVIDIA’s H100 and A100, in the Chinese market.
Reports from the Financial Times highlight this phenomenon, with smaller Chinese CSPs providing companies access to AI servers equipped with 8 x NVIDIA A100 AI GPUs for a mere $6 per hour. In comparison, the same setup would cost around $10 per hour in the United States, representing a 50% price difference.
This discrepancy is directly linked to the availability of these advanced chips in China, despite US sanctions aimed at restricting their access. The availability is further fueled by reports suggesting the smuggling of these chips into the country. Estimates indicate that over 100,000 NVIDIA H100 AI GPUs are currently in circulation within China, openly sold on local marketplaces.
The pricing of these GPUs in China also differs significantly from the US market, with NVIDIA’s H100 being sold for approximately $23,000 to $30,000. This pricing is significantly lower than the peak prices seen during periods of scarcity when US sanctions made acquiring high-end AI chips a challenge in China.
This development signifies the growing prominence of China in the global AI landscape. The ease of access to high-performance AI hardware at competitive prices is likely to accelerate AI innovation and adoption within China, creating further ripples in the global AI industry.
