- Flying Petabytes of AI -Data is China’s latest solution for strict US chip controls
- Physical smuggling of hard drives is now bypassing surveillance and digital firewalls across multiple jurisdictions
- GPU-rich Malaysian data centers become earthced to offshore Chinese AI training
As the United States continues to tighten export restrictions on advanced AI chips, such as those produced by Nvidia, Chinese AI companies turn into a solution that feels almost analogous to today’s digital world.
Instead of relying on online transfers or sanctioned hardware, some companies are transporting physically large data sets on cross -border hard drives.
A report from Wall Street Journal Requirements Four Chinese Tech staff recently flew into Malaysia, each carrying 15 high-capacity hard drives, in total an astonishing 4.8 Petabyte data, intended to train large language models.
Big data continues to enter China in spite of restrictions
US restrictions have made it increasingly difficult to acquire advanced AI GPUs through legal channels.
Although Nvidia maintains, “there is no evidence of chip discharge,” on Earth, reports otherwise suggest a black market for smuggled NVIDIA GPUs that thrive in China.
Some of these chips are reportedly entering the country through subsidiaries and partners in neighboring countries.
However, this route becomes more expensive and more risky due to increased control and diplomatic pressure from Washington on these middle countries.
As a result, companies change tactics: Instead of importing limited chips exporting the massive amounts of training data.
This is a complex and resource -intensive process. Companies carefully plan the physical transport of data and distribute drives to avoid detection with customs.
They also rent GPU-rich servers in third-party countries like Malaysia to process the data.
An example involves a Chinese company that used its Singapore-registered subsidiary to sign a data center contract. However, the Malaysian partner later insisted on local registration to avoid regulatory pressure when Singapore began tightening his own controls.
Despite increasing efforts from US agencies, enforcement holes and logistical logging holes continue to be exploited. While shipping Petabytes of data on hard drives may seem outdated, it has bandwidth restrictions and digital monitoring.
The use of hard drives, ranging from large SSDS arrays to external HDDs with high capacity, is central to these hidden transfers.
Still, it raises a question: Why not use magnetic tape, especially considering that modern LTO-10 formats can save up to 30TB uncompressed and 75TB compressed?
The answer is probably in practical. Tape solutions require specialized read/write hardware and lack the plug-and-play concrete in advanced HDDs that are often used today.
