Friday, May 2nd 2025

NVIDIA Dismisses Anthropic's Report of Ludicrous GPU & CPU Smuggling Methods
The first couple of paragraphs within Anthropic's "Securing America's Compute Advantage: (Our) Position on the Diffusion Rule" article are standard fare. Roughly half-way through a read of this policy-related piece, the North American (Amazon-backed) AI startup makes some bizarre claims about the smuggling of AI-oriented products into China. Given ongoing global tensions and growing industry demands, these activities are somewhat expected—but Anthropic leadership described very specific methodologies. As stated within their "Chip Smuggling is a Major Threat" passage: "China has established sophisticated smuggling operations, with documented cases involving hundreds of millions of dollars worth of chips. In some cases, smugglers have employed creative methods to circumvent export controls, including hiding processors in prosthetic baby bumps and packing GPUs alongside live lobsters." Specific bits of hardware were not mentioned in this section, but the author later alludes to the frictionless transfer of thousands of "NVIDIA H100 advanced chips" into Chinese territories.
In a statement issued to CNBC, a Team Green spokesperson dismissed Anthropic's fanciful claims: "American firms should focus on innovation and rise to the challenge, rather than tell tall tales that large, heavy, and sensitive electronics are somehow smuggled in 'baby bumps' or 'alongside' live lobsters." This very public spat has received mainstream attention; with further coverage documenting additional "to and fro" barbs. NVIDIA criticized Anthropic's anti-foreign competition stance: "China, with half of the world's AI researchers, has highly capable AI experts at every layer of the AI stack. America cannot manipulate regulators to capture victory in AI." Amusingly, Anthropic's operations rely heavily on Team Green hardware—many online critics reckon that top US AI companies are jostling for priority access to cutting-edge GPUs/accelerators. In reaction to NVIDIA's dismissal of their report, a company spokesperson retorted with: "Anthropic stands by its recently filed public submission in support of strong and balanced export controls that help secure America's lead in infrastructure development and ensure that the values of freedom and democracy shape the future of AI."
Sources:
Anthropic News, HKEPC, Tom's Hardware, VideoCardz, Whole Lobsters Canada (image source), CNBC
In a statement issued to CNBC, a Team Green spokesperson dismissed Anthropic's fanciful claims: "American firms should focus on innovation and rise to the challenge, rather than tell tall tales that large, heavy, and sensitive electronics are somehow smuggled in 'baby bumps' or 'alongside' live lobsters." This very public spat has received mainstream attention; with further coverage documenting additional "to and fro" barbs. NVIDIA criticized Anthropic's anti-foreign competition stance: "China, with half of the world's AI researchers, has highly capable AI experts at every layer of the AI stack. America cannot manipulate regulators to capture victory in AI." Amusingly, Anthropic's operations rely heavily on Team Green hardware—many online critics reckon that top US AI companies are jostling for priority access to cutting-edge GPUs/accelerators. In reaction to NVIDIA's dismissal of their report, a company spokesperson retorted with: "Anthropic stands by its recently filed public submission in support of strong and balanced export controls that help secure America's lead in infrastructure development and ensure that the values of freedom and democracy shape the future of AI."
16 Comments on NVIDIA Dismisses Anthropic's Report of Ludicrous GPU & CPU Smuggling Methods
www.tomshardware.com/pc-components/gpus/despite-nvidia-claims-chinese-smugglers-have-used-live-lobsters-and-fake-baby-bumps-to-traffic-chips
The same reasons for why sanctions against Russia were a total failure.
A massive chunk of illegal GPUs are making their way into China and that's naturally going to bring into question whether Nvidia is doing any due diligence in preventing that from happening or even potentially aiding it.
Nvidia has significant control over who it sells GPUs to and they often wield their control over the supply chain to keep partners and AIBs in line. They've ironically gotten sued for that as well. You can't have this tight control over your GPU supply and then claim you have no control when it comes to GPUs ending up in China. That's obviously a contradiction.
Even if they did, do you expect them to say "ah man you got me!"
And besides, if nGreediya is claiming the smuggling operations are NOT happening, then they obviously know that it IS happening, and have chosen to NOT do squat about it, that way they can continue to claim that there are so-called "shortages" and therefore justify their asinine prices of the high-end parts...
'nuff said
They are export restricted along the lines of national defense. Not even remotely in the same realm as regular consumer computer parts. The point of laws isn't to completely prevent something, that is impossible as you pointed out. Their purpose is to reduce the frequency and number, something of which they are well proven to be effective at with hundreds of years of evidence over human history.
Mind you I'm in complete agreement that laws that slow the flow of these goods are in fact, effective.
Consumer cards might be much much easier to get due to the difficulty of keeping tabs on all potential ways they can be smuggled as you pointed out earlier.
www.tomshardware.com/tech-industry/deepseek-gpu-smuggling-probe-shows-nvidias-singapore-gpu-sales-are-28-percent-of-its-revenue-but-only-1-percent-are-delivered-to-the-country-report
www.trendforce.com/news/2025/02/19/news-singapore-clarifies-less-than-1-of-nvidias-revenue-linked-to-physical-shipments-there-amid-china-concerns/
www.tomshardware.com/tech-industry/artificial-intelligence/massive-366-percent-chip-shipment-surge-to-malaysia-amid-increased-nvidia-ai-gpu-smuggling-curbs-ahead-of-looming-sectoral-tariffs
Seriously tough, these things happen through a very long chain, built to obscure who's who.Chip makers do not have the (lawful) ability to track all that. It's mostly a job for secret services, enforcing these embargoes.