Biden's AI chip export limits could cost $50B in innovation

The Biden administration's recent proposal for new export restrictions on artificial intelligence (AI) chips has triggered significant pushback from the technology sector, raising concerns about its impact on innovation and global competitiveness.

Announced on January 13, the framework aims to impose caps and licensing requirements on semiconductor sales to all but 18 allied nations.

Ned Finkle, Nvidia's vice president of government affairs, criticised the move as "misguided" and warned it could derail "innovation and economic growth."

"Rather than mitigate any threat, the new Biden rules would only weaken America’s global competitiveness," he emphasised that the rules would control technology already prevalent in consumer products.

The proposed restrictions include limits of up to 50,000 semiconductors per country, with government-to-government agreements potentially raising that cap to 100,000.

Certain institutions may apply for licenses to purchase up to 320,000 chips over two years, while orders of 1,700 units or fewer would not require a license.

Daniel Castro from the Information Technology and Innovation Foundation expressed concern that pressuring countries to choose between the U.S. and China could alienate key partners.

He noted that many nations might prefer uninterrupted access to AI technologies vital for their economies.

John Neuffer, president of the Semiconductor Industry Association, stated that the policy was being rushed without industry input, warning it could cause "unintended and lasting damage" to the U.S. economy.

Conversely, U.S. Commerce Secretary Gina Raimondo defended the restrictions as necessary for national security while allowing for technological leadership.

"Managing these very real national security risks requires taking into account the evolution of AI technology," She remarked.

The framework is currently open for public comment for 120 days before being finalised by the incoming administration.