China offers to help tech companies solve ‘major AI problem’ but on one condition

China is reportedly offering a solution to every AI company’s biggest problem – soaring energy bills. The country’s government is reportedly increasing financial incentives for data centres, offering tech companies subsidies that cut their energy bills by up to half. The move is a direct effort to boost China’s homegrown semiconductor industry and sustain its push to compete with the US in the global AI race. The ask? To qualify for the substantial energy savings, data centres must be powered by domestic chips – which in a way is penalising continued reliance on foreign vendors like Nvidia.

Citing people familiar with the matter, a report by The Financial Times says that this new wave of subsidies comes in response to complaints from major Chinese tech giants, including ByteDance, Alibaba, and Tencent.