Chinese e-commerce giant Alibaba is reportedly developing a new chip for artificial intelligence, according to several media reports.
The news comes as the AI arms race intensifies, with Washington restricting China’s access to advanced US-made semiconductors.
In April, the United States banned Nvidia from selling its most powerful Blackwell chip to China, citing national security concerns.
Although Nvidia later agreed to pay Washington a 15% levy on China sales, approval to export Blackwell remains uncertain.
China in turn reportedly instructed local firms to stop buying Nvidia chips in August, escalating the technology dispute further.
Alibaba is no newcomer to chip design, having launched its Hanguang 800 processor in 2019 through its T-head unit.
The company has pledged to invest at least 380 billion yuan (€45 billion) into AI over the next three years.
Reports suggest Alibaba’s latest chip will not be sold externally but will power its cloud services for client rentals.
This model would mirror strategies by US rivals like Google and Microsoft, who monetise AI through cloud-based infrastructure.
The competition is intensifying, with Chinese peers Huawei and Cambricon also pushing their own AI chip developments.
Alibaba, like ByteDance, has admitted its AI progress depends heavily on Nvidia’s technology, raising questions over self-sufficiency.
President Xi Jinping this week urged AI cooperation, rejecting what he called a “Cold War mentality” over the technology.
Meanwhile, Nvidia’s CEO Jensen Huang said his firm is in talks with Washington about a new China-specific AI chip.
The race highlights both the promise and the risks of AI, with experts warning of a “suicide race” scenario.
