US Plan to Regulate AI Chip Access by Major Cloud Providers

In a recent move targeting Beijing, the United States is set to give tech giants like Google and Microsoft a key role in controlling access to highly desired AI chips around the world, according to two sources familiar with the ongoing draft plan.

The new regulations, expected to be announced soon, will require these companies to meet stringent guidelines. This includes reporting vital data to the US government and limiting access to China for these AI chips.

This action will allow Google and Microsoft to offer artificial intelligence solutions in the cloud internationally without needing a special license, the sources revealed.

As the Biden administration nears its end, officials are racing to simplify the approval process for AI chip exports while simultaneously restricting access for potentially malicious actors.

The US is particularly concerned that China might leverage AI to enhance its military capabilities, conduct significant cyberattacks, or develop bioweapons.

The US Commerce Department has declined to provide details on the anticipated regulations or their timeline. Sources suggest that plans might evolve as discussions continue.

Both Google and Microsoft have yet to respond to inquiries regarding the new regulations.

This upcoming measure appears similar to a national security agreement Microsoft signed in April, which enables it to supply AI technology to the Emirati company G42.

In this latest draft, other firms that do not have gatekeeper status will still compete for licenses to import a limited volume of high-performance AI chips from companies such as Nvidia and AMD in their respective countries, according to one of the sources.

Nvidia, recognized for manufacturing the most advanced AI chips globally, has asserted its readiness to collaborate with the administration regarding the new rules. AMD has not yet commented on requests for information.

Countries considered allies, including the Netherlands and Japan, along with Taiwan, would be spared from these import limitations, having unrestricted access to AI chips, as per two sources.

Conversely, nations under nuclear embargo, such as Russia, China, Iran, and Venezuela, will continue to be barred from acquiring US-made AI semiconductors.

However, the potential limitations could lead to unrest among some countries. Geoffrey Gertz, a former official from the White House, expressed concerns that a global cap program on chip access may create significant worry among US partners and allies about unilateral decisions made by the United States regarding who can access essential AI technology.

The US government is conducting a final review of an "Artificial Intelligence Diffusion" rule drafted by the Commerce Department, as indicated by a recent government posting, signaling that the publication of this policy might be imminent. According to three sources, this posting hints at the forthcoming AI chip limitations.

The Information Technology Industry Council, which includes members like AMD and Google, has expressed worries that the Biden administration is hurriedly finalizing this complex rule without adequate input from the industry, potentially leading to unforeseen negative consequences.

"If the reports are correct, such changes would significantly broaden the scope of export regulations and result in considerable global ramifications," stated Naomi Wilson, senior vice president of Asia and global trade policy at the council.

The proposed rules build upon an initiative announced in September, allowing pre-approved overseas data centers to receive AI chips without needing a license, according to two sources.

To gain this approved status, data centers must disclose information about their customers, business activities, access limitations, and cybersecurity measures.

AI, Chip, Regulation