NVIDIA’s AI Chip Renting Services In China Are Much Cheaper Compared To The US, For As Little As $6/Hr

NVIDIA's AI GPU "renting services" have seen a drastic rise in China, as small-scale CSPs provide AI chips that are much cheaper to rent compared to the US.

AI accelerator "decentralization" has recently picked up a massive pace in the markets, especially in regions influenced by US sanctions, such as China. With the AI hype picking up in Chinese markets, the region has found new loopholes in US policies, and one way to get access to cutting-edge AI GPUs is by renting them out. We recently reported on how Chinese AI engineers have been accessing NVIDIA's chips by working with specific global brokers and using cryptocurrency as a means for financial payments to maintain anonymity.

Now, The Financial Times reports that Chinese CSPs have stepped into the business, offering their hardware stack for renting out, and interestingly, the prices are phenomenally lower compared to what firms are offering in the US. It is disclosed that small CSPs in China provide companies with an AI server that consists of eight NVIDIA's A100 AI GPUs, and it only costs $6 per hour to rent them out, while in the US, the same setup would cost around $10, marking around a 50% difference.

Interestingly, despite the US sanctions, NVIDIA's H100 and A100 AI GPUs are readily available in China, which is why the rental costs are much lower than in other regions. According to a Chinese startup founder, it is estimated that more than 100,000 of NVIDIA's H100 AI accelerators are present in the country, and they are being sold openly on Chinese marketplaces, notably Xiaohongshu and Alibaba’s Taobao, and given the compact size of the chips, they are being smuggled all over the country.

NVIDIA's H100 is being sold in China for around $23,000-$30,000, a drastic drop from its peak price when it was being sold in the black markets for around astronomical prices after the Biden administration halted the sales of the chip. Apart from this, multiple Chinese firms are setting up subsidiaries in other countries and then acquiring NVIDIA's AI chips in an attempt to work around the US policies, so it's safe to say that the sanctions haven't had much of an impact on the markets.