ByteDance in Talks to Buy Custom AI Chips from MediaTek for Data Centers
nashnova research
ByteDance is close to a deal with MediaTek for custom ASIC chips powering its data centers — a move that would make it MediaTek's second major ASIC client after Google and signals how U.S. export controls are reshaping Chinese tech giants' chip supply chains.
What exactly is this deal about?
Bloomberg reports, citing people familiar with the matter, that ByteDance and MediaTek are in advanced talks over custom ASIC chip supply for data centers.
ASICs — application-specific integrated circuits, chips built for one particular task — are less versatile than Nvidia's GPUs but more power-efficient and cheaper for specific workloads. They're how big internet companies cut AI computing costs.
This means → ByteDance isn't just buying off-the-shelf hardware. It's having MediaTek design chips to its own specifications — a deeper commitment than purchasing general-purpose GPUs.
Why not just buy from Nvidia?
U.S. export controls block Chinese companies from purchasing Nvidia's most advanced AI chips, and domestic suppliers like Huawei cannot fill the entire gap.
The current rules leave an opening: as long as the AI computing power Chinese firms access stays below a specific threshold, custom ASIC partnerships with chip designers remain permitted.
In plain terms = the best Nvidia chips are off-limits, Huawei can't supply enough, so ByteDance turns to designers like MediaTek and Qualcomm for made-to-order chips — staying inside the regulatory red line.
What does ByteDance's chip supply strategy look like?
Earlier this year, ByteDance struck a similar deal with Qualcomm, purchasing millions of AI chips.
The MediaTek talks extend a diversified chip supply strategy — spreading bets across multiple vendors.
This reflects a broader trend: under export-control pressure, Chinese tech giants are shifting from single-supplier dependence to multi-vendor, custom-design, risk-spreading sourcing.
What does MediaTek stand to gain?
MediaTek has long been known for mobile chips. Landing ByteDance would significantly boost its push into the data center market.
MediaTek expects about $2 billion in AI chip sales this year and is targeting 15% of a roughly $80 billion market next year.
In September, Nvidia announced a $3.5 billion investment in MediaTek. This means → even Nvidia is endorsing MediaTek's data center ambitions — the company is evolving from a smartphone chip maker into a serious AI chip contender.
How much is ByteDance spending on AI?
ByteDance is reportedly considering raising this year's capital expenditure to as much as $70 billion — more than double last year's figure.
If economic and business conditions allow, that number could rise to $100 billion by 2027. ByteDance completed a $30 billion loan facility in September to fund this expansion.
In plain terms = ByteDance's annual AI infrastructure spend is approaching the GDP of some mid-sized countries — a scale that signals AI is not a side bet but the company's core strategic priority.
What to watch next?
ByteDance's AI efforts center on its flagship model Seedance, competing against Alibaba, Kuaishou's Kling AI, and Google.
Whether MediaTek can use ByteDance as a strategic anchor client to challenge Broadcom in the data center ASIC market is a key test of its transformation.
This reflects a larger structural shift: the data center ASIC market is moving from Broadcom's dominance toward multi-player competition — and Chinese tech giants' demand is a key force driving that change.
市场有风险，内容仅供研究参考，不构成投资建议。