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Tech war: DeepSeek’s ‘UE8M0 FP8’ innovation seen as boost for China’s AI self-sufficiency

Use of the UE8M0 FP8 technique further reduces the graphics storage and computing power needed to run AI systems

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In this photo illustration, the logo of DeepSeek is displayed on a smartphone screen with DeepSeek-V3.1 in the background. Photo: VCG via Getty Images
Ben Jiangin Beijing

A technical change in the latest model from Chinese artificial intelligence start-up DeepSeek could be a big step towards achieving China’s goal of AI self-sufficiency, as it shows a new level of coordination between local model developers and hardware makers, according to analysts and industry insiders.

This week, the Hangzhou-based AI lab said its new V3.1 model was trained using a UE8M0 FP8 scale data format, which was suitable for the “home-grown chips soon to be released”.
While DeepSeek did not specify the vendor of the implied chips or whether their use would be in training or inferencing, the wording elicited enthusiasm about an upcoming tech breakthrough that could enhance China’s prospects of cutting reliance on imported AI chips such as the graphic processing units (GPUs) from Nvidia.
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DeepSeek did not respond to a request for comment on Friday.

Separately, Shanghai-listed shares of Cambricon Technologies, a local GPU designer that is a potential challenger to Nvidia, gained 20 per cent on Friday. The stock has more than doubled from a July low, as mainland investors bet on its growing role in supplying domestic AI chips.

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In Hong Kong on Friday, shares of Hua Hong Semiconductor gained 18 per cent, while Semiconductor Manufacturing International Corp was also up 10 per cent amid hopes that the two chip foundries could do the heavy lifting in producing China’s own GPUs.
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