China grids up for tech leader crown

Silicon Valley’s AI soap opera – with founders feuding, billion-dollar valuations, and eye-watering salaries – continues to hog headlines. But the more consequential story is unfolding 10,000 kilometres away, in China.

In Beijing and Shanghai, a new phase of the technology contest is emerging, one that fuses state strategy with fast-moving startups and a hardware base that is becoming increasingly self-reliant.

On 21 August, Chinese startup DeepSeek released its V3.1 model. The model itself was not the surprise. What excited local markets was a single line the company posted about its dataset: “UE8M0 FP8 is designed for the upcoming next-generation domestic chips.”

Translated from engineering jargon, that meant: Chinese companies chip makers are getting close to making chips than can handle the complex maths behind AI. Traders took the hint. Chinese semiconductor stocks surged, with investors betting that the country is closer to cutting its reliance on West.

All this is snowballing to a stage where even giants like Nvidia finds itself at an awkward spot. The company remains the undisputed king of AI compute, yet investors worry that its hold on Chinese AI market that is worth billions of dollars is slipping as local chip makers step up.

Slippery Ground:Nvidia remains the leader now, with second quarter revenue of 46.74 billion US dollars and yearly projections that still makes rivals drool. Yet investors worry that their China story is clouded: Nvidia revealed that no H20 chips (one that was specially made for Chinese market) was shipped to China this quarter despite some licences.

For years, China has chafed under American semiconductor sanctions, watching as Washington weaponised chip exports to maintain technological supremacy. Nothing would have angered China more words of Commerce Secretary Howard Lutnick who claimed during a recent interview that Nvidia wants to sell China its “fourth best” chip, which is slower than the fastest chips that US companies use.

“We don’t sell them our best stuff, not our second best stuff, not even our third best,” Lutnick said.

Beijing's recent declaration that H20 chips pose a “security risk” was less about genuine security concerns and more about sending a signal to adopt indigenous innovation.

Cambricon’s Revenge: No company has benefited more from Beijing’s push than Cambricon Technologies. The Beijing-based chipmaker’s shares have more than doubled since mid-July and are up over 550percent  since September 2024. For a brief moment, it even overtook luxury liquor giant Kweichow Moutai as the most expensive stock in China. At one point, the company had to issue a statement to cool expectations.

The surge marked a dramatic turnaround for Cambricon’s founders, brothers Chen Yunji and Chen Tianshi, alumni of the Chinese Academy of Sciences’ elite “genius youth class.” Just two years earlier, Washington had blacklisted the company for alleged military links, forcing layoffs and stalled projects.

Now, backed by Beijing’s campaign to localise computing power, Cambricon is being hailed in Chinese media as “Little Nvidia.”

Cambricon is betting its future on the Siyuan 690 processor – a chip designed to rival Nvidia’s H100. The real test isn’t just raw performance, but ecosystem compatibility. Chinese AI companies increasingly need chips optimised for their specific algorithms and cost structures – something Nvidia’s export-restricted chips struggle to deliver, says Techwire Asia.

Broader Ecosystem: Cambricon is not alone. DeepSeek’s reference to FP8-class chips was widely seen as a signal that multiple Chinese chipmakers are closing the gap while lower cost AI models are gaining ground. Giants like Huawei, Alibaba and Baidu have embraced cheaper open-source models, pushing rapid adoption across sectors: government (95%), finance (78%), telecoms and healthcare (each above 60%), according to analysts Frost & Sullivan.

Experts say the trend reflects a shift towards “software-hardware collaboration,” reducing dependence on foreign computing. And unlike the American approach of chasing headline-grabbing frontier models, Chinese software developers are emphasising usability, cost efficiency, and integration into existing ecosystems.

The application layer is moving just as quickly. In China’s booming e-commerce sector, AI avatars are becoming tireless salespeople. On Taobao, a virtual woman in a white shirt and black skirt promotes printers around the clock – no holidays, no breaks, no fatigue. Shanghai-based PLTFRM says it has deployed about 30 such avatars across major platforms, often outselling human hosts.

The Long Game: China’s ambitions are not hidden. Its ten-year AI development plan calls for artificial intelligence to become a “key growth engine” of the economy by 2035, part of a strategy that treats technology as an instrument of national power and sovereignty.

The world need not plunge into the alphabet soup of FP8s and H20s to understand the stakes. What is unfolding is a reordering of technological power – one in which companies like Cambricon symbolise more than financial exuberance. They signal a nation accelerating its way into a future where computing power is as strategic as oil once was.

What’s unfolding is more than a competition between tech companies or even nations – it’s a contest between fundamentally different visions of how technology should be developed, controlled, and deployed. The American model, built on venture capital, market dominance, and platform monopolies, faces off against China’s state-directed approach that prioritises national objectives over individual profit maximisation.

For countries like India, the lesson is clear: in an era where technological sovereignty increasingly determines national power, there is no neutral ground. The question isn’t whether to choose sides in the US-China tech race, but how to build sufficient indigenous capabilities to maintain strategic autonomy while the giants battle around them.

Space scientists dream big

Bigger is better seems to be the new trend in space tech. SpaceX has pulled off a successful launch of its next-generation rocket, Starship, after nine unsuccessful attempts. The 40-storey-tall rocket with 33 booster engines is the largest and most powerful rocket built to date. Meanwhile, the Indian Space Research Organisation (Isro) is also planning to launch a 40-storey-tall rocket by 2025. Chairman V. Narayanan said the rocket is expected to be ready by 2035. It will also be capable of placing a 75,000-kilogram payload in low-Earth orbit and supporting future lunar missions.

Meanwhile, two Indian startups have launched their own satellites. Pixxel Space and Dhruva Space sent up their satellites via SpaceX’s Falcon 9 rocket last week. Bangalore-based Pixxel launched three Firefly satellites, completing its first six hyperspectral satellites, which will observe Earth in detail. Hyderabad-based Dhruva Space has also launched its first commercial LEAP-01 satellite, carrying payloads from Australian companies that will enable edge computing in space.

Real money gamers start fighting

As expected, real-money game operators in India have moved the court against the government’s ban on their platforms. Gaming company A23, which offers Rummy and poker, has challenged the ban, arguing that the new law criminalises the legitimate business of online games of skill. Ever since the ban came into force, gaming companies have been opposing it, saying that thousands of people will lose their jobs, but the government remains firm, saying these games are creating major social problems, with millions becoming addicted.

More concrete proof of 3D houses

Building a single-level house with a 3D printer isn’t news anymore. But an Australian company, Contec, has quite literally gone up another level. They printed a double-storey concrete home – and that too in just 18 hours. Sure, the finishing touches – roofing, wiring, interiors – still dragged on for five months, but that’s still warp speed compared to what we’re used to. The company boasts that its concrete mix is three times stronger than brick, fire-resistant, termite-proof, and keeps the heat out. Meanwhile, Indian readers can only wait for such technology to arrive on our shores. Till then, we are stuck with house projects that stretch on for years and end with a building that starts peeling before the housewarming photos have even faded.

Some hot news from the lab

Next time someone complains about the heat, remind them they’re lucky they’re not Glen Kenny. The 61-year-old University of Ottawa physiologist spends days in 40°C chambers, studying how extreme heat affects older people. Years of such sweaty experiments show more people are at risk as the planet heats up. And now, another study adds insult to injury: climate change doesn’t just make you sweat, it makes you age faster. Basically, global warming is turning us all into raisins – even climate change deniers might want to pause, if only to check their wrinkles.