Tech war: Huawei wields growing influence in China’s server industry with AI chip success
- Huawei has taken on an increasingly important role under Beijing’s tech self-sufficiency drive, with soaring domestic demand for servers equipped with its AI chips
Huawei Technologies, which was forced to divest its traditional server subsidiary three years ago under pressure from US sanctions, has regained its influence in that sector on the mainland, thanks to the popularity of its artificial intelligence (AI) chips, according to industry analysts.
Shares of Digital China Group, one of the major players in China’s server market, fell by their daily limit of 10 per cent on the Shenzhen Stock Exchange on Monday and continued their weak performance through Wednesday, following a report that said Huawei may adjust its business model and return to assembling servers instead of just providing key components.
The China Business News quoted an unidentified Huawei official as saying that the Shenzhen-based firm was considering such a move but has not decided yet.
The potential move by Huawei could affect companies such as Digital China, which has been working with the telecommunications giant to jointly deliver server solutions to end users. If Huawei decides to go solo, these companies would become mere “distributors”.
Huawei’s computing business has two product lines; Kunpeng for general servers and Ascend for AI computing. A number of Chinese computer developers, including iSoftStone Information, Talkweb, Huakun and xFusion, are also partnering with Huawei.
Huawei declined to comment on Wednesday.
