America is squandering its key advantage in AI competition. Since 2023, China has imported than 250 DUVi machines — technology that China needs to make domestic AI chips like Huawei's Ascend 950. While we've been cutting China off from importing AI chips directly we're still sending them the tools to make AI chips domestically. @nchlsbrwn's Modeling shows that China will be able to massively ramp up its AI chip production if it keeps access to these tools. But it's not too late to act. Given the heavy use of US components in DUVi machines, USG could ban their export and servicing today. This would be a major upset to Chinese AI chip production. Our first major CTS report offers a thorough review of the options available to USG and their security and economic consequences.

Excellent report by @rhodium_group Some highlights: * Chinese AI capex this year estimated at $140B. Compare that to $800B US big five AI capex this year. * Leading US AI companies make more than 10x more revenue than leading Chinese AI companies. * Chinese AI companies have substantially lower gross margins compared to US AI companies (despite being able to free-ride on US progress through adversarial distillation) There's a lot of great research to be done to better understand the business models of US vs Chinese AI companies, including revenue sources, addressable market, and funding sources.