I think that simplifies it a bit. You can't train without hardware, which is why the Chinese companies are illegally importing Nvidia cards [1].

[1] https://www.theinformation.com/articles/deepseek-using-banne...

The usefulness of the smuggled NVIDIA GPUs has greatly diminished for AI purposes, because the elimination of NVIDIA as a competitor has allowed the growth of the production of domestic GPUs.

Moreover, China has just demonstrated a supercomputer faster than any US supercomputer, which unlike the US supercomputers, which need GPUs, achieves its high computational throughput with custom CPUs designed in China (implementing an Armv9-A ISA with SME, i.e. the scalable matrix extension, and with BF16/INT8 operations for AI).

The CPUs used in that supercomputer can reach both a computational throughput and a memory bandwidth sufficiently high for training any LLMs (they have fast HBM memory). Their only disadvantage in comparison with the best NVIDIA GPUs is a slightly lower energy efficiency, but China has abundant cheap energy so this is not a serious disadvantage for them.

There is significant evidence they are transitioning to Huawei and other home-grown CPUs and NPUs.