Nvidia Photo: VCG

With the upcoming GPU Technology Conference (GTC) 2025 hosted by Nvidia, which is set to run from Monday to Friday in San Jose, California, investors are trying to use the conference to gauge the impact of the US "small yard, high fence" strategy on the future outlook and the broader technology industry.

Nvidia expects 25,000 in-person attendees at the show, with 300,000 attending virtually. The highlight of the event will be CEO Jensen Huang's keynote speech on Tuesday, where analysts expect Nvidia to unveil its GB300 artificial intelligence (AI) chip and its next-generation graphics processing unit (GPU), according to media reports.

However, it seems that beneath the surface of this technological extravaganza lies a cloud of concern that looms large over the future of Nvidia and the broader AI industry. Year to date, through Friday's close, Nvidia stock was down 9.4 percent.

Nvidia has long been a powerhouse in the AI domain, renowned for its technological prowess. Nevertheless, investors still appear uncertain and worried about Nvidia's future. According to Melius Research, investors' near-term concerns include potential negative effects from tariffs and additional restrictions on sales to the Chinese market. These policies cast a long shadow over the industry, raising fears that they may hinder innovation and disrupt global collaboration in the semiconductor and AI industries.

In recent years, the US government, in an attempt to impede China's technological development, has imposed stringent export controls in the chip sector, including restricting the supply of Nvidia's high-performance AI chips to the Chinese market. With China being one of the world's largest chip-consuming markets, the export restrictions not only pose growing uncertainty for Nvidia but also exert a negative impact on the healthy development of the global chip industry.

The AI industry is another area that has been negatively affected. AI technology, as a cutting-edge and global field, relies heavily on in-depth cooperation and extensive exchanges among researchers and enterprises worldwide for continuous innovation and progress. However, the US government's restrictive policies are creating an environment where collaboration is increasingly difficult, leading to a troubling trend of isolationism.

This trend is exemplified by the recent actions of OpenAI, once a champion of open-source AI. In a surprising shift, OpenAI has increasingly moved toward a closed model, even advocating for restrictions on Chinese AI technologies. In a 15-page letter submitted to the White House Office of Science and Technology Policy on March 13, OpenAI called the Chinese AI model DeepSeek a "significant risk" and urged the US government to take action against it. 

Apparently, a motive for this move, which seriously violates the scientific spirit, is the pressure OpenAI faces to enhance its competitiveness. It was supposed to use DeepSeek's success as a reminder for self-reflection and an opportunity to make faster progress, but instead it tried to use political means to crush its competitors, which is truly disappointing.

The success of DeepSeek already proves that only through open collaboration can more innovative ideas be generated, driving the continuous development of AI.

The same is true for the chip industry. Chip research and development (R&D) must prioritize a comprehensive understanding of user needs, as the end-users of chips span a wide array of industries, including consumer electronics, vehicles, communications and industrial controls. Each of these sectors has unique requirements that evolve in tandem with technological advancements and shifting market dynamics. 

If chip manufacturers adopt a closed R&D model and fail to engage collaboratively with their users, they risk misaligning their R&D efforts with actual market demand. This disconnect can lead to a significant gap between R&D direction and practical application, ultimately hindering innovation and limiting the effectiveness of the products they develop. 

In conclusion, the "small yard, high fence" policy of the US, which aims to maintain technological superiority in a closed environment, risks undermining its own technological leadership and bringing more constraints for its own AI and semiconductor industries. In such a restrictive environment, even companies like Nvidia will have to encounter headwinds stemming from investor concerns.