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Comment by Haven880 | Hacker News Reader

More like China-factor to get us out of the mess. We wait for Huawei photonics gpus (end of this year), CXMT and YMTC ramping up production to flood the market or as Janet coined it overcapacity. You know China will undercut the price significantly.

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China doesn't have enough to supply itself.

Neither does anyone else. Key difference being they planned for this 5 years ago instead of last quarter

Planned doesn’t mean achievable. The yields are still low.

Low is better than nothing.

Low yields means their production can cost more than they sell it for, which is not sustainable. They have to have yields good enough that they can make money, otherwise the government is just subsidizing a give away, which is fine if they don’t export them but wouldn’t make sense if they do.

Chinese planning revolves around mastering a technology no matter the cost, then monopolozing the global market no matter the cost, then bankrupting existing foreigner competitors or entirely preventing them from arising in the first place no matter the cost, to only then caring about costs and to start profiting from it all.

Sounds like SV VC culture.

Chinese strategy of monopolizing markets via low prices is strange, it has no moat, they win simply because they provide the best value. I mean, its great for us, I’m all for it, but it doesn’t have an end game where they can actually ever set prices.

They win because it leverages their strategic asset: a vast labor pool.

Right now they're trying to avoid the other side of that coin (low value trap) by integrating vertically.

That's where capitalism-with-Chinese-characteristics comes into play, since the CCP knows it's a capacity they want to get some independence from the government creates incentives to develop it until it becomes self-sustainable.

They have a strategic goal which the government will support while at the same time letting competition do its thing, it's a step above from what other governments used to do with government-backed R&D that would eventually be developed by the private sector into products.

Not sure why other countries aren't adopting this model adapted to their own needs, seems very effective so far. Well, I'm not sure but have a big hunch it's the usual big business blocking it since it'd create more competition in a more level playing field.

Why would the CPC (the correct acronym) subsidize cheap GPUs to America? You won’t see huawei GPUs here until their yields are decent enough to make it profitable.

CCP is the common one even though not the official, either use is fine and understandable (as you've understood it clearly).

What do you mean? I'm talking about the CCP funding projects to increase yield for their fabs, not buying GPUs from NVidia...

It’s CPC because the official name of the party is Communist Party, China, a hold over to when China was more aligned with the soviets before Stalin died. As long as they subsidize GPUs for domestic use, it makes sense. But we won’t see them for export until their yields are good enough to make them profitable. They will also have a hard time scaling with bad yields, leading to a continued need for GPU imports to meet demand.

> It’s CPC because the official name of the party is Communist Party

I'm very aware of that but it's commonly referred to as CCP which is understandable for any reader, I don't need to change it to CPC to be understood at all. Not sure why you insist on nitpicking this point, rather pointless, it's just a common way to refer to it.

> CPC (the correct acronym)

https://en.wikipedia.org/wiki/Chinese_Communist_Party

Read the very first sentence.

Yes, the western world has basically told the Chinese what the proper acronym should be even if the Chinese disagree.

China has plenty of money to subside low yields while they improve their technology.

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