DeepSeek bets on Huawei as China pushes to end reliance on Nvidia 

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By Eduardo BaptistaBeijing just sent a message to every Chinese AI startup dreaming of a Western exit — and it could not be clearer.China’s state planner has ordered the unwinding of Meta’s NASDAQ:META acquisition of Chinese AI agent startup Manus, once touted as the country’s next DeepSeek. The landmark decision is a warning shot to every Chinese tech founder with Western ambitions.Manus sought a global profile by first marketing aggressively on X and then relocating core technical staff to Singapore after closing shop on the mainland.The downfall of this deal could be faster than the origin story. Manus’ founders are restricted from leaving China while the company risks being hollowed out as Chinese regulators assert sovereignty over the intellectual property and talent Meta acquired. An M&A deal is being dismantled in real time.In recent years, China has banned companies from exporting user data, algorithms and other digital assets without regulatory approval. Neither Meta nor Manus sought Chinese regulatory approval for the deal or its relocation to Singapore, sources told Reuters. Meta did not respond to a request for comment.Beijing’s message is clear: AI is key geopolitical leverage in its Cold War with Washington. Everything else – the interests of private Chinese tech firms, their investors, and multinational corporations – takes a backseat to national security.The Manus decision shows how quickly the AI world is splitting into rival camps.In this week’s issue, we look at how China is exercising its power and corporate alliances to hit back at U.S. export controls in another way. Forward this newsletter to a friend who follows AI, chips or geopolitics. They can also subscribe .OUR LATEST REPORTING IN TECH AND AIBlocking of Meta's AI startup buy raises risk for cross-border China tech dealsExclusive: US State Dept orders global warning about alleged AI thefts by DeepSeek, other Chinese firmsDeepSeek unveils new AI model tailored for Huawei chips as China pushes for tech autonomyDeepSeek-V4, the Chinese AI model adapted for Huawei chipsDeepSeek's new AI model does not wow markets in fast-changing industryPARALLEL AI ECOSYSTEMSDeepSeek’s preview of its long-awaited V4 model failed to tank global markets this time. But the launch introduced a different kind of reveal.Among the limited information the small Chinese startup disclosed was how the new mo...

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