Huawei and pals reportedly plan to produce high bandwidth memory by 2026

Getting their hands on AI memory one Huawei or another...

A group of Chinese semiconductor firms including Huawei are reportedly looking to get domestic production of high bandwidth memory (HBM) up and running by 2026.

The group has support from the Chinese government and aims to achieve domestic supply of HBM for the country's burgeoning AI processor industry, according to a report from The Information. There are understood to be at least two production lines in action so far, manufacturing memory from different members of the partnership to see which ones have the most potential.

As a sign of Huawei's leadership in the consortium, the HBM chips are reportedly optimized for Huawei products, and the Chinese tech giant is also expected to be the largest buyer. However, other AI processor and GPU companies in China like Biren and Moore Threads would probably be interested in ordering native HBM as well, as the memory chips have much more bandwidth than mainstream GDDR6 VRAM, which is ideal for AI.

HBM is more expensive to produce than GDDR6, yet the payoff may be worth it as these chips are expected to go into high-margin GPUs and AI processors for datacenters.

If Huawei and its partners can successfully develop their own HBM manufacturing plants, it would be a big boost for China's AI industry. US sanctions on companies including Huawei, Biren, and Moore Threads makes it challenging to acquire HBM, and if the companies want to keep up in the AI race, they're going to need the high-end memory somehow.

It's not clear if ChangXin Memory Technologies (CXMT), which is also reportedly investing into HBM manufacturing, is involved with Huawei's alliance. CXMT has access to prior generation memory manufacturing equipment via US-based firms Applied Materials and Lam Research, which have the export licenses needed for these operations to work legally. Given that working with Huawei could impact these licenses, CXMT's efforts might be independent.

However, since March the US government has reportedly considered putting CXMT under sanctions according to Bloomberg, and if these sanctions are enacted it could push CXMT to partner with Huawei.

If successful, the Chinese market for AI processors could become the turf of the country's own companies. Under current export restrictions on China, US companies are limited to selling chips with less than 150 TFLOPS in the Middle Kingdom, which forced Intel to substantially cut down the China variant of its Gaudi 3 chips.

Current export rules don't restrict things like memory bandwidth or capacity, which is still an important factor in AI performance. Though, with lots of raw horsepower and HBM chips that provide just enough bandwidth, China-made AI processors and GPUs could give Nvidia and others a very tough time. ®

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