TikTok owner will spend $12 billion this year on AI accelerators from Nvidia and Chinese manufacturers

Formally, we learned about the intentions of the Chinese company ByteDance to spend $7 billion this year on the purchase of Nvidia computing accelerators in the first hours of this year, but the Financial Times now has more detailed information about the structure of these costs. Of the $5.5 billion allocated for infrastructure development in China, ByteDance can spend about 60% on the purchase of accelerators from Chinese developers.

Image source: ByteDance

This distribution is largely due to tightened US sanctions, which prohibit Nvidia from supplying modern computing accelerators to China. In turn, the Chinese authorities recommend that local companies cover up to 30% of their need for computing accelerators with products from local developers. In the case of ByteDance, this requirement is met with a double margin, and the purchase of accelerators from Chinese companies Huawei and Cambricon is expected.

A separate revelation is ByteDance’s desire to spend not $7 billion, but all $12 billion, on the purchase of accelerators this year. If $5.5 billion of this is intended for the development of the company’s Chinese computing infrastructure, then another $6.8 billion will be spent outside China for similar needs . In this case, as expected, priority will be given to the purchase of Nvidia accelerators.

Representatives of ByteDance refused to comment on the rumors, calling the information mentioned above incorrect. There were no comments from Nvidia at all. According to some reports, last year the Chinese ByteDance became the second largest buyer of Nvidia Hopper generation accelerators. Spending of $12 billion could allow ByteDance to claim the status of the largest buyer of Nvidia accelerators this year, but the situation surrounding the Chinese-owned social network TikTok is too politicized to ensure that this goal is easily achieved.