US Explores Location Trackers for AI Chips, Official Says

In a strategic move to monitor semiconductor distribution, U.S. officials are examining the possibility of integrating advanced location-tracking features into AI chips. This initiative is part of ongoing efforts to limit the export of crucial technology, particularly from companies like Nvidia Corp., to China. Michael Kratsios, a key figure behind the recent U.S. AI action plan, emphasized the importance of collaborating with the tech industry to develop methods for tracking the movement of sensitive semiconductor components. Speaking to Bloomberg Television while attending an APEC Digital and AI Ministerial Meeting in South Korea, he stated, "There is discussion about potentially the types of software or physical changes you could make to the chips themselves to do better location-tracking. This is explicitly included in our action plan." The U.S. government's commitment to these technologies comes as tensions with Beijing escalate. Last week, Chinese officials convened with Nvidia representatives to address U.S. concerns regarding security risks tied to their H20 chips. Washington's approach aims not only to protect national interests but also to ensure that American technology remains at the forefront of innovation. Furthermore, Kratsios highlighted the government's readiness to enhance federal financing tools to bolster AI technology exports to allied nations. He asserted, "The next groundbreaking developments will be built on American technology, and to fully leverage them, the U.S. AI infrastructure must be established." This U.S. strategy has drawn criticism from China, which has long opposed American surveillance practices and restrictions targeting its tech industry. The Chinese government remains particularly wary of semiconductor sanctions that are perceived to undermine its leading firms like Huawei Technologies Co. and emerging AI companies such as DeepSeek. In a recent trade deal context, U.S. officials indicated a willingness to lift export restrictions on Nvidia's H20 chips to China, in exchange for securing sales of rare-earth magnets to the U.S. However, curbing chip smuggling remains a top priority for Washington. Kratsios clarified that he has not engaged directly with Nvidia or Advanced Micro Devices Inc. regarding the potential for location-tracking technologies. In response to concerns, Nvidia has publicly stated that its chips do not contain any backdoors. Additionally, Kratsios critiqued China's AI governance proposals, advocating instead for a regulatory approach that prioritizes innovation, asserting, “We believe each country should set their own destiny on how they think about regulating artificial intelligence.”