NVIDIA’s AI GPUs in China Now Selling at A Tremendous 500,000 Yuan Price Tag

NVIDIA has benefited tremendously from the AI hype, generating revenue figures not yet seen in the industry. A report claims that NVIDIA's cut-down AI GPUs in China are now sold at astonishing prices, reaching as high as 500,000 yuan/ US $69,000.

NVIDIA Seems to Be Creating a Monopoly Over the AI Industry, GPU Demand & Prices Increasing Day-by-Day

The rapid increase in the demand for AI GPUs, such as the H800, has caused a shortage in Chinese markets, which has resulted in large-scale inflation. The need for AI GPUs has been at an all-time high in China since companies like Alibaba and ByteDance are acquiring high volumes of such GPUs. It was previously reported that ByteDance purchased $1 billion worth of NVIDIA AI GPUs for server applications.

As a reminder, NVIDIA is selling cut-down variants of the H100 and A100 GPUs in China to bypass US sanctions. Considering that the GPUs sold in China are much inferior in performance, it is surprising that they have gained massive traction in Chinese markets. The source report that the A800 and H800 GPUs are now being sold for an all-time high, reaching almost 500,000 yuan. The figure is a large one to ask, and we won't be surprised if NVIDIA continues to sell the GPUs at this price since AI isn't a thing to mess around with in China.

Another fact highlighted by the report is that NVIDIA is also pricing its products based on "relationships" with its clients. At first, acquiring huge orders will require a good relationship with the company's CEO Jensen Huang. The "extent" of the connection with the company will determine what price companies will get.

This ecosystem has evolved mainly because of one reason; NVIDIA has created a monopoly over the industry, and there are no competitors. Hence, companies that require AI GPUs are bound to reach out to NVIDIA, which gives Team Green an upper hand. However, this monopoly "bubble" could burst out anytime since the industry is continuously evolving, and new competitors will hopefully emerge, a prime example being Intel introducing their "Gaudi2 AI Accelerators" in China.

Written by Muhammad Zuhair