TikTok's parent company ByteDance to develop its own AI chips
ByteDance, the parent company of popular social media platform TikTok, is reportedly partnering with TSMC to design its own artificial intelligence (AI) chips. The Information reports that two such chips are already in development, and are expected to be mass-produced by 2026. This strategic move aims to reduce ByteDance's reliance on NVIDIA's high-cost graphics processing units (GPUs), which are subject to US export controls.
Chip orders and cost-saving measures
ByteDance has reportedly ordered over 200,000 of NVIDIA's H20 chips, specifically designed to comply with US export controls. The company is still awaiting this order, which is worth over $2 billion. However, ByteDance now plans to procure processors for training and inferencing from TSMC, in a move that could potentially save it billions of dollars. The Information notes that these chips are still under design and plans have not been finalized yet.
ByteDance's AI advancements and market competition
In August last year, ByteDance introduced an AI-powered chatbot called Doubao, which has successfully competed against Baidu's Ernie Bot — often referred to as China's version of OpenAI's ChatGPT. According to Bloomberg, Doubao surpassed Ernie Bot in downloads and active monthly users on iOS, within a year of its launch. In May, ByteDance rolled out a range of Doubao large language models (LLMs) for businesses at competitive prices.
Baidu's AI chip development
Baidu is also reportedly developing its own AI chip called Kunlun 3. This chip will soon begin production at TSMC, according to an individual familiar with the matter. This development comes as the US recently updated its export controls on critical technologies, to counter China's technological progress. Chinese companies' collaboration with TSMC hinges on compliance with these annually updated controls.
