Tech war: US wants cloud firms to report foreign users tapping their computing power for AI applications

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United States Commerce Secretary Gina Raimondo said her department is exploring how to force cloud companies to disclose when a foreigner taps their computing power to fuel artificial intelligence (AI) applications, signalling the next phase of the tech war between Washington and Beijing.
“We’re beginning the process of requiring US cloud companies to tell us every time a non-US entity uses their cloud to train a large language model (LLM),” Raimondo said at an event on Friday, without naming any countries or firms. LLMs are the software behind AI tools like ChatGPT.
US President Joe Biden in October directed the agency to require such disclosures in an effort to detect foreign actors that might use AI to launch “malicious cyber-enabled activity”, according to Biden’s directive.
The Commerce Department has also been looking into ways to regulate the cloud via export controls, following up on sweeping restrictions limiting China’s access to the most powerful semiconductors.
United States Commerce Secretary Gina Raimondo speaks on Day 1 of the AI Safety Summit at Bletchley Park in Bletchley, Britain, on November 1, 2023. Photo: Reuters
The worry in Washington is that Chinese companies can access the same computing power of those chips through cloud providers such as Amazon Web Services, Microsoft Corp’s Azure and Alphabet’s Google Cloud.

“We want to make sure we shut down every avenue that the Chinese could have to get access to our models or to train their own models,” Raimondo said in an interview last month.

China’s development of AI and other next-generation technologies is a top concern for the Biden administration, which sees Beijing as its primary global strategic competitor.

Washington has tried to rein in China’s advances by restricting chip exports to the country and sanctioning individual Chinese firms, but the country’s tech giants have managed to make significant breakthroughs despite US curbs.

China’s semiconductor industry weathers tough year amid tighter US sanctions

The US in October tightened its controls to capture more chips, semiconductor-manufacturing equipment and geographies.

One key update targeted Chinese-headquartered companies operating in more than 40 countries, an attempt to prevent those firms from using other nations as intermediaries to secure semiconductors they cannot access at home.

But what the rules did not address is Chinese firms’ ability to tap into the capabilities of those chips via the cloud.

It is unclear exactly how the US would regulate that type of activity. Cloud services do not involve the transfer of physical goods, and the Commerce Department has specifically said they are beyond the domain of export controls.

Tighten US restrictions on China’s access to key technologies, Congress told

Thea Kendler, assistant secretary for export administration, told lawmakers last month that “we may need additional authority in that space”.

US cloud providers have worried that restrictions on their activities with overseas users without comparable measures by allied countries risks disadvantaging American firms.

The Commerce Department will separately survey companies that are developing LLMs about the results of their safety tests, Raimondo said on Friday, though she did not provide details about what they will request.

Microsoft, Amazon and Alphabet did not immediately respond to requests for comment.

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