Chinese tech giant Huawei faces significant obstacles in its mission to lead the production of artificial intelligence (A.I.) chips. This effort, key to countering Nvidia's dominance in the United States, has been compromised by faulty software. The result has been an exodus of customers who prefer maintaining business relationships with U.S. companies.
Huawei software problems, including stability glitches and slower connectivity, have discouraged buyers. An A.I. engineer at a partner company explained that Huawei's chips lag far behind Nvidia's in terms of ability to train A.I. models.
The Chinese A.I. industry had hoped that Huawei's Ascend series would help meet the growing demand for digital infrastructure. However, drawbacks have limited its use to less complex processes, such as data inference. Several experts say the technology is still being prepared to compete on a level playing field.
China stepped up its support for Huawei following increased semiconductor export restrictions imposed by the United States in October last year. These measures have pushed the Chinese technology industry to seek domestic solutions. However, software and hardware shortcomings have proven to be more challenging than expected.
Meanwhile, consolidation in the data center market has accelerated. Companies such as Australia-based AirTrunk have experienced breakneck growth. Founded in 2016, this company has built 11 regional data centers and is one of the fastest-expanding technology firms.
U.S.-based Blackstone has shown interest in acquiring AirTrunk in a deal that would include its debts. Silver Lake and DigitalBridge have also considered acquiring the company. AirTrunk was evaluating a potential initial public offering before receiving these proposals.
Interest in data center companies like AirTrunk reflects the urgent need for A.I. infrastructure. With a data center portfolio valued at $55 billion, Blackstone has emphasized its intention to continue investing in new facilities.
According to the Financial Times, investors see great potential in this sector due to the sustained growth of artificial intelligence and digital storage needs. However, both Blackstone and Macquarie, which in 2020 acquired a majority stake in AirTrunk, declined to comment on ongoing negotiations.
Huawei's situation, meanwhile, highlights the challenges China faces in matching the U.S. in advanced technology. Australia's AirTrunk is an example of the global dynamism in this field, with digital infrastructure playing a vital role in the evolution of artificial intelligence.
