Microsoft calls on Trump to loosen AI chip export restrictions

Microsoft is calling on the Trump administration to loosen Biden-era restrictions on artificial intelligence (AI) chip exports that it argues could undermine U.S. leadership on the technology.

The AI Diffusion Rule, announced in the final days of the Biden presidency, placed caps on chip sales to most countries around the world, exempting a narrow list of 18 U.S. allies and partners.

“As drafted, the rule undermines two Trump administration priorities: strengthening U.S. AI leadership and reducing the nation’s near trillion-dollar trade deficit,” Microsoft vice chair and president Brad Smith said in statement.

“Left unchanged, the Biden rule will give China a strategic advantage in spreading over time its own AI technology, echoing its rapid ascent in 5G telecommunications a decade ago,” he continued.

Microsoft warned the AI Diffusion rule “goes beyond what’s needed” and puts important U.S. allies into a second-tier category, making it more difficult to build AI datacenters in these countries.

The tech giant pointed to Switzerland, Poland, Greece, Singapore, India, Indonesia, Israel, the UAE, and Saudi Arabia, where it and other American companies have significant datacenter operations.

“The unintended consequence of this approach is to encourage Tier Two countries to look elsewhere for AI infrastructure and services,” Smith added. “And it’s obvious where they will be forced to turn. If left unchanged, the Diffusion Rule will become a gift to China’s rapidly expanding AI sector.”

The AI Diffusion Rule was the latest in a series of actions taken by the Biden administration to limit China’s ability to obtain advanced AI chips made by American companies.

President Trump has sought to break from his predecessor on AI, emphasizing innovation and lighter regulation. On his first day in office, Trump rescinded former President Biden’s executive order on AI that sought to address risks associated with the technology.

Vice President Vance carried this message to the AI Action Summit in Paris earlier this month, where he slammed “excessive regulation" that “could kill a transformative industry just as it’s taking off.”

However, the Trump administration has so far not walked back the Biden administration’s various restrictions on AI chip sales, including the AI Diffusion Rule, which faced significant pushback from the semiconductor industry when it was announced last month.

Commerce Secretary Howard Lutnick also spoke out against allowing the Chinese government and businesses to build their AI systems using U.S. technology.

“We need to drive our innovation, and we need to stop helping them. You know, open platforms — Meta’s open platform let DeepSeek rely on it. Nvidia’s chips, which they bought tons of, and they found their ways around, drive their DeepSeek model. It’s got to end,” Lutnick said during his confirmation hearing before the Senate Commerce Committee.

“If they are going to compete with us, let them compete, but stop using our tools to compete with us.”

Lutnick oversees the Bureau of Industry and Security (BIS), the Commerce Department agency responsible for implementing import and export bans, along with other national security-related trade rules.

Microsoft noted Thursday that it supports “the need to protect national security by preventing adversaries from acquiring advanced AI technology” and suggested that other elements of the rule should remain.

“This puts the opportunity for the Trump administration in bold relief,” Smith said. “It can take an overly complex rule that requires 41 pages in the Federal Register and right-size it. Make it simpler. Stop relegating American friends and allies into a second tier that undermines their confidence in ongoing access to American products.”

Topics

Japan warns over threat from China’s chip material export controls

Officials and executives say gallium rules will upset supply chains for chips and vehicle batteries
Financial Times - 6d
Amazon touts its first quantum computing chip a week after Microsoft's unveiling

Amazon revealed its first chip for quantum computing, and said its design will help the online retailer build highly efficient hardware systems.
CNBC - 2h
Huawei improves AI chip production in boost for China’s tech goals

Chinese company improves ‘yield’ of latest semiconductor, despite US efforts to prevent manufacturing advances
Financial Times - 2d
Nvidia revenues jump almost 80% on booming AI chip sales

Chief Jensen Huang says demand remains strong despite worries China’s DeepSeek could stymie growth
Financial Times - 11h
Microsoft reiterates plan to invest $80 billion in AI, but may 'adjust our infrastructure in some areas'

Microsoft hasn't backed off its plan for the current fiscal year but acknowledged that it may makes some infrastructure adjustments.
CNBC - 2d
Microsoft’s new Phi-4 AI models pack big performance in small packages

Microsoft's new Phi-4 AI models deliver breakthrough performance in a compact size, processing text, images and speech simultaneously while requiring less computing power than competitors.
VentureBeat - 16h
Associated Press sues three top Trump officials over access restrictions

"The press and all people in the United States have the right to choose their own words and not be retaliated against by the government," the AP said in its lawsuit.
CBS News - 5d
Republicans dig in heels against restricting Trump powers in shutdown talks

Top Republicans are digging in their heels against restricting President Trump’s powers in funding negotiations with Democrats, as both sides struggle to strike a deal to avert a government ...
The Hill - 22h
Trump's AI safety cuts

Welcome to The Hill's Technology newsletter {beacon} Technology Technology The Big Story AI safety institute faces cuts under Trump Potential cuts to the U.S. AI Safety Institute (AISI) are ...
The Hill - 2d
Trump cuts financial lifeline for Venezuela's government by ending permit to export oil to US

A permit issued by the United States government allowing energy giant Chevron Corp. to pump and export Venezuelan oil will be terminated this week
ABC News - 22h
Robot Startup Figure Reveals an AI Breakthrough Called Helix

The company also released a video showing two humanoid robots putting away groceries. It’s worth watching.
Inc. - 6d
Call Of Duty Uses Generative AI For Some Content, Activision Admits

An update to the Call of Duty HQ page on Steam confirms that Activision's development teams do in fact use "generative AI tools" as a means to "help develop some in-game assets.". About a year ago, ...
GameSpot - 2d
Trump calls Zelenskyy a ‘dictator’ in growing war of words

Even as the White House pushes to end the war in Ukraine, President Donald Trump is escalating his attacks on President Volodymyr Zelenskyy, describing him as a "dictator." NBC’s Richard Engel ...
NBC News - Feb. 20
Trump: GOP senator had 'close call' with fall

President Trump weighed in on the recent head injury sustained by Sen. Kevin Cramer (R-N.D.) after he slipped and fell on ice during a trip home, wishing him a speedy recovery but noting the ...
The Hill - 1d
Apple AI tool transcribed the word 'racist' as 'Trump'

Experts have questioned the company's explanation that it is due to the two words being similar.
BBC News - 1d
Trump calls Zelenskyy a "dictator" after blaming Ukraine for Russia's invasion

"A Dictator without Elections, Zelenskyy better move fast or he is not going to have a Country left," President Trump wrote.
CBS News - Feb. 19
Trump's Ukraine envoy calls Zelensky 'embattled and courageous leader'

President Trump's special envoy to Ukraine and Russia called Ukrainian President Volodymyr Zelensky an "embattled and courageous leader" after meetings in Kyiv on Friday, a notable shift from ...
The Hill - 6d
CBC calls Trump suspension of USDA 1890 Scholars program 'outrageous'

The Congressional Black Caucus (CBC) is calling on President Trump to reinstate an education program designed to support students from rural and underserved communities pursuing degrees in ...
The Hill - 5d
Trump administration calls for ICE agents to locate migrant children: Source

There are more than 600,000 migrant children who have crossed the southern border without a legal guardian or parent since 2019, according to government data.
ABC News - 3d
Trump calls DOGE email on federal employees' work week an 'ingenious idea'

President Trump praised an email sent by DOGE to federal workers asking them to respond with their accomplishments at their position in the last week.
NBC News - 3d
'This is insane': Democratic senator rips DOJ official calling prosecutors 'Trump's lawyers'

Sen. Chris Murphy (D-Conn.) strongly criticized the interim attorney for D.C., Ed Martin, for describing prosecutors as "President Trump's lawyers," calling his statement "insane." In a social ...
The Hill - 2d
Trump declines to describe Putin as a 'dictator' after calling Zelenskyy one

President Donald Trump hosted French President Emmanuel Macron at the White House, where they discussed the status of Ukraine-Russia peace talks.
ABC News - 2d
Trump’s Iron Dome for America system is now reportedly called Golden Dome

The initiative, established by executive order, is touted to protect US skies from attacks, much like Israel’s system. Donald Trump ’s Iron Dome for America initiative for a missile defense ...
The Guardian - 1d
Trump called Republicans to get their vote for Johnson's budget plan

President Trump called some Republican lawmakers to sway them to vote for House Speaker Mike Johnson's budget plan, as the congressional leader struggled to get the necessary numbers. CBS News' ...
CBS News - 1d
Trump suggests pilot's license be suspended in close call at Chicago airport

President Trump suggested the business jet pilot who was involved in a near-miss at Chicago's Midway International Airport on Tuesday have his license suspended in a fiery post on social media. ...
The Hill - 1d
Rejecting Trump’s Call to Annex Their Nation, Canadians Rally Around the Flag

While Canadians are not generally known for flag waving, President Trump’s threats have led to a surge in flag sales and buffed up the national symbol’s image.
The New York Times - 1d
House Democrats call on Trump to rescind order against gender-affirming care

More than 80 House Democrats are calling on President Trump to revoke an executive order to broadly restrict access to gender-affirming health care for transgender young people, alleging the ...
The Hill - 1d
Norwegian Cruise on Trump’s call to pay U.S. taxes: It’s ‘really, really complicated’

Norwegian’s earnings show the cruise boom continued, but the outlook exposed some cracks and the stock turned lower.
MarketWatch - 1h
UK services exports shine amid economic gloom

Consulting is key to unlocking growth in the face of global headwinds, says analysts
Financial Times - 14h
AI video of Trump kissing Musk’s feet plays on TVs in HUD building

A video produced using artificial intelligence (AI) showing President Trump rubbing and kissing Elon Musk's feet played on television screens in the Department of Housing and Urban Development ...
The Hill - 3d
AI Video of Trump and Musk Appears on TVs at HUD Building

The video, which appeared to be generated by artificial intelligence, was emblazoned with the message “Long Live the Real King.”
The New York Times - 2d
Trump shares AI video envisioning Gaza development with gold statue of president

President Trump on Tuesday evening shared a video using artificial intelligence (AI) that showcases his proposals for the potential development of the war-torn Gaza Strip, complete with a golden ...
The Hill - 1d
What an AI-generated video of Gaza reveals about Trump tactics

US President Donald Trump sparked a social media frenzy when he posted a video of Gaza generated by artificial intelligence on his site Truth Social. Marianna Spring has been analysing the online ...
BBC News - 1d
Trump Shares AI Video of Gaza as Luxury Resort, Drawing Scorn

One scene from the video, whose origins are unclear, shows President Trump and Prime Minister Benjamin Netanyahu sitting shirtless at a pool with drinks. Hamas condemned it as “disgraceful.”
The New York Times - 18h
Powerful quantum computers in years not decades, says Microsoft

It says a new chip it has created could end up being as important a breakthrough as the semiconductor.
BBC News - Feb. 19
Warmer weather on the way as severe freeze loosens dangerous grip

A major snowstorm and dangerous freeze that left parts of the U.S. covered in ice and snow is beginning to loosen its grip.
NBC News - 6d
Bearded Bronx Bombers: Yankees Follow Other Companies Loosening Dress Codes

The team’s decision to repeal a half-century rule banning beards reflects widespread post-pandemic changes on attire and appearance across U.S. businesses.
Inc. - 3d
Merz examines using outgoing parliament to loosen debt brake

German election winner says he will hold talks with other parties to adopt constitutional change in next 30 days
Financial Times - 3d
EU to keep climate goals but loosen rules for companies, says green chief

Bloc has to balance protection of the planet and economic growth, Teresa Ribera argues
Financial Times - 1h