ByteDance, the parent company of TikTok, has joined the race to reduce dependence on U.S. technology by designing its own artificial intelligence (AI) chips. Partnering with Taiwan Semiconductor Manufacturing Company (TSMC), ByteDance aims to mass produce two AI chips by 2026, according to reports. These in-house chips are intended to replace Nvidia’s expensive graphics processing units (GPUs), which have become subject to U.S. export controls. This strategic shift comes as China continues to develop its domestic AI capabilities amid growing competition between Chinese tech companies.
In addition to hardware developments, ByteDance is making strides in the AI software space. The company’s AI-powered chatbot, Doubao, has surpassed rival Baidu’s Ernie Bot in downloads and monthly active users on iOS, positioning ByteDance as a formidable player in China’s burgeoning AI industry. By launching more cost-effective large language models (LLMs) for enterprise clients, ByteDance is also challenging its competitors, forcing them to cut prices dramatically. The company’s plans to produce its own chips will further reduce reliance on foreign tech, potentially saving billions in GPU costs.
ByteDance isn’t the only Chinese firm moving toward self-sufficiency in AI hardware. Baidu has also designed its own AI chip, the Kunlun 3, which is expected to enter production at TSMC soon. As the U.S. continues to tighten export controls on critical technologies, China’s tech giants are increasingly focused on developing domestic alternatives to maintain their AI advancements. This competition not only marks a shift in the global AI landscape but also underscores China’s drive to become a leader in AI innovation.