TikTok parent company ByteDance is betting big on Artificial Intelligence (AI) despite the United States’ curbs on chip sales to China. According to a report by The Information, the TikTok owner plans to spend $7 billion on Nvidia chips in 2025.
This comes as President-elect Donald Trump intervened in the TikTok ban. Trump has urged the US Supreme Court to delay the January 19 TikTok ban deadline. He is seeking time for a “political resolution.” Meanwhile, ByteDance has denied links to the Chinese government over the allegations of security concerns.
ByteDance sidesteps US AI chip curbs
As per the report, ByteDance is looking to become one of the largest consumers of AI hardware. It is relying on external suppliers to sidestep US restrictions. Chinese firms reportedly bypass restrictions by setting up new entities or training AI models outside the country.
The United States announced restrictions on certain kinds of AI chips exported to nations like China in 2022. Four Chinese industry associations also warned against over-reliance on US-made chips and security concerns. This could potentially impact companies like Nvidia, AMD, and Intel.
ByteDance, which is headquartered in China, is picking loopholes in the curbs by not bringing chips directly to its country. The company is reportedly storing them in data centers located in other regions like Southeast Asia. This move technically doesn’t violate any of the US-imposed restrictions.
Trump urges Supreme Court to delay TikTok ban
The US President-elect is asking the Apex Court to delay the looming TikTok ban while seeking time to pursue a “political resolution.” Meanwhile, the law requiring ByteDance to divest TikTok or face a ban by January 19 is fast approaching.
US officials and lawmakers have cited ByteDance’s ties to the Chinese government as cause for concern. The company has filed multiple legal challenges. It argues that the law violates free speech protections but with little success so far.
The Supreme Court will hear arguments on January 10 and will give ByteDance, TikTok, and the US government one last chance to make their case. Trump hopes to push the deadline back to avoid a ban that would impact TikTok’s 170 million US users.
Trump met TikTok CEO Shou Zi Chew last week and described the social media platform as having a “warm spot in his heart.” Meanwhile, the Justice Department and over 20 state attorneys general argue the app is a national security risk. They’re urging the court to uphold the law that Congress and President Biden approved earlier this year.
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