ByteDance and Broadcom are in talks to develop an AI processor for the parent company of TikTok. The proposed deal between the Chinese firm and the US chip designer, which share an existing relationship, would effectively safeguard ByteDance’s procurement and supply chains while supporting their advances in AI development. The manufacturing of the new chip would be outsourced to TSMC, the world’s leading supplier of advanced semiconductors, representing a crucial juncture to satisfy US concerns given the ongoing trade restrictions with China, which prohibit the export of cutting-edge components. This compliance with the measures put in place by Washington back in 2022 means there is scope for a deal to be completed but it will still be subject to scrutiny. Despite some deals on older semiconductor technology, the US curbs have prevented any public movement on the trading of 5nm tech or more advanced chips, but this unique agreement can be secured. Broadcom’s existing relationship with ByteDance At this stage of the planned ByteDance Broadcom collaboration, the US must be content that there is no significant prospect of enhancing China’s chipmaking development, given the previous actions the government has taken. ByteDance will also be working with two major global chip makers, in what is an unusual step. As first reported by Reuters, the collective work would be focused on the 5-nanometer chip, a dedicated product also known as an application-specific integrated chip (ASIC).