Chinese tech giant ByteDance, owner of the popular social media platform TikTok, is collaborating with US chip designer Broadcom to develop a cutting-edge artificial intelligence (AI) processor. This move is seen as a strategic effort to secure a stable supply of high-end chips for ByteDance amidst ongoing tensions between the US and China.
The chip is designed using a 5nm process. It is customized for ByteDance’s specific needs. This type of chip is known as an ASIC, which stands for application-specific integrated circuit. ByteDance’s chip will comply with US export restrictions. Manufacturing will be outsourced to Taiwan Semiconductor Manufacturing Company (TSMC), the world’s leading chip manufacturer.
This collaboration is significant because it marks a development. There haven’t been any publicly announced joint chip projects between US and Chinese companies using 5nm or more advanced technology. This is since the US imposed export controls on such semiconductors in 2022.
According to sources familiar with the matter, ByteDance’s partnership with Broadcom, a trusted supplier, aims to achieve two main goals. Firstly, it is expected to significantly cut down on procurement costs. Secondly, the partnership aims to ensure a reliable supply of advanced chips. However, mass production of the new chip isn’t anticipated to begin this year. While design work is progressing well, the official manufacturing process hasn’t commenced.
Neither ByteDance nor Broadcom responded to requests for comment, and TSMC declined to comment as well.
Limited AI Chip Availability for Chinese Tech Firms
ByteDance, like many other global tech companies, is heavily invested in developing generative AI technologies. However, Chinese firms face a significant challenge due to limited access to advanced AI chips compared to their US counterparts. Export restrictions have blocked access to Nvidia’s most powerful chipsets, which are crucial for advancements in AI and supercomputing. The competition for alternative solutions, including US-made chips designed specifically for the Chinese market and those from Huawei, another major Chinese player, is fierce.
ByteDance’s Efforts to Secure AI Hardware
The collaboration with Broadcom reflects ByteDance’s proactive approach to securing the hardware needed to power its AI ambitions. The company has been a business partner with Broadcom since at least 2022, purchasing their high-performance Tomahawk 5nm switch chips and Bailly switches for AI computing clusters.
In addition to the new chip development project, ByteDance has reportedly stockpiled Nvidia chips, including A100 and H100 models acquired before US sanctions, as well as A800 and H800 variants designed for the Chinese market but later restricted. Sources claim ByteDance allocated a staggering USD2 billion for Nvidia chip purchases last year.
Furthermore, ByteDance has reportedly purchased HUAWEI’s Ascend 910B AI chips and has a significant number of open positions related to semiconductors, including 15 specifically for ASIC chip designers. The company is also actively recruiting top talent from other Chinese AI chip firms.
