GPU Chip Restrictions

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Aaron Ginn

October 19, 2023

This was a wild week for the GPU market. Brand new export restrictions caused a tumultuous week. Additional limitations on future H100 orders are expected. The steady pricing from previous weeks was thrown out the window. Here is what my team at Hydra Host is seeing.

New export restrictions lay down the hammer - The US government continues to turn up the heat on advanced computing chips with export chips. The looming new rules released this week are substantial and include additional manufacturing equipment restrictions and expanded qualifications. The new proposed regulations made “Chinese” NVIDIA chips irrelevant in design and, at the same time, valuable. These chips were essentially designed to evade export restrictions, and the new rules significantly expanded their scope and authority (see images below). Almost all advanced chips from NVIDIA and some gaming chips qualify. There are some exceptions to be more targeted, but the US government’s explicit goal is enterprise data centers. The US government has capped China’s computing power, forcing it to accelerate its internal development. The black market for GPUs will aggressively develop over the coming year. I wouldn’t be surprised if GPUs become like a new drug trade.

Slapping OEMs selling only cards - NVIDIA is tracking down OEMs selling GPU cards rather than building complete systems. NVIDIA aims to expand its footprint as fast as possible in data centers worldwide, and this under-the-table market is slowing it down. It is also exacerbating the shortage, so we heard NVIDIA removing allocation to OEMs, continuing to sell just chips and not building servers.

Buy. Buy. Buy whatever you can get - From these looming restrictions from the US government and NVIDIA applying more pressure to GPU-as-a-service vendors, there is a renewed aggressive buying spree. Some companies are hoarding to resell in the future, while others are concerned that nothing will be left. A handful of companies are scooping every H800 they can find, betting that the same thing that happened to A100s will happen to H800s. We saw new and used A100 supply disappear the same day. H100 servers moved faster than usual as companies expect future price increases.

GPU prices will increase soon - Due to restricted supply and higher demand, prices are going up again. Orders in November and December are already higher than in October. We expect H100s to have the most considerable price increase. Resellers are also increasing their prices due to fewer buyers and more shortages. Feels like we are in a prison yard-style market again.

We have supply today if you need A100, H100, or other GPUs. Ping [email protected] for availability. We can help find any GPU for you, whether renting or buying.