A data center outside Osaka now runs thousands of Nvidia’s newest chips for Tencent, giving the company a path around Washington’s hardware limits while keeping everything within legal bounds.
The GPUs sit inside a site owned by Datasection, a Japanese group that once sold marketing solutions but flipped into AI infrastructure last year.
That pivot pulled in more than $1.2 billion in contracts tied to Tencent through a third-party partner, according to people who know the deal.
These contracts cover a big slice of Datasection’s first batch of 15,000 Blackwell processors, all parked in Japan at a moment when China cannot import the same chips.
Datasection’s move placed it among Asia’s rising neocloud players, a group that includes CoreWeave in the U.S. and Nebius in Europe. These operators rent out Nvidia hardware at a huge scale and serve global tech firms hungry for compute.
Norihiko Ishihara, Datasection’s chief executive, said the demand shift has been wild. He said “less than half a year ago…5,000 B200 chips were sufficient to support AI models,” but that the floor has doubled and “10,000 should be the minimum requirement.”
His comment sums up the pace of this market and the reason companies like Tencent are moving fast to secure GPU capacity offshore.
Expanding offshore GPU access and building long-term contracts
China’s largest platforms have been forced into overseas workarounds after U.S. export rules blocked Nvidia’s best chips from entering the country. Datasection grew as this pressure intensified, with Trump canceling a Biden-era plan to close the loophole in May.
The Osaka project was finalized soon after. Earlier this month, the White House approved a lower-tier Nvidia chip for China, which could help Tencent start building its own domestic sites again.
But analysts say the offshore approach may stay popular. Lin Qingyuan at Bernstein Research said renting compute abroad may be “the more attractive choice for Chinese tech groups.”
Tencent, Alibaba, and ByteDance are all training models outside China and selling the output, said people familiar with these operations.
Datasection expects to run more than 100,000 Nvidia processors across future facilities. Its first 15,000 chips are mostly locked into Tencent contracts for three years, with options to extend. Ishihara would not confirm Tencent by name, calling it only a “major customer,” citing confidentiality.
Datasection’s stock price is up nearly 185% this year, though it has fallen from a summer high above ¥4,000 because traders fear over-investment and react to a short seller’s attack on the business.
Building Sydney’s hyperscale B300 cluster and facing scrutiny
In July, Datasection agreed to buy 5,000 B200 chips for $272 million for the Osaka site, supported by a $406 million three-year contract with one of the world’s largest cloud firms. Server crates filled with new GPUs arrived in August.
Soon after, Datasection and its partner signed another three-year, $800 million agreement to build a second AI data center in Sydney. This new cluster will use tens of thousands of B300 chips, which outperform the versions Nvidia is allowed to sell into China.
Datasection said the first 10,000 B300s will cost $521 million. Ishihara said the site will be “the world’s first hyperscale AI cluster by using B300 chips.” People with knowledge of the project said Tencent is expected to be the main user.
Tencent said it follows all laws and that its use of “cloud computing services is both transparent and legal.”
Ishihara said GPU purchases are his biggest expense. He spreads that cost over five years, while customer deals usually run three years with a two-year extension option.
Contracts run through a partner to protect client data; for Tencent, that partner is Tokyo-based NowNaw. Datasection can cancel agreements if U.S.–China rules tighten again.
The company has also come under attack. A short seller questioned links to Tencent and to First Plus Financial Holdings, a Singapore-based investor.
Datasection said its projects are “in full compliance with all applicable laws and regulations.” Ishihara later said U.S. Commerce Department and Nvidia approvals were obtained for GPU use.
Datasection is raising ¥50 billion through warrants issued to First Plus, which could dilute shareholders by up to 200%. The investor, owned by a Chinese national, wants to keep its stake below one-third.
Ishihara said First Plus does not want to consolidate Datasection into its accounts and surrendered voting rights to avoid Japan’s foreign exchange control scrutiny. First Plus did not comment.
The company is now pushing into cloud services and targeting Europe. It hired Spanish politician Pablo Casado Blanco as chair and added John Ellis Bush Jr to its board.
Ishihara said high demand for GPU power makes it easy to replace customers if export rules change again. In a worst-case scenario, he said “we may have to stop the operation for, let’s say, one week,” calling the asset “very sexy.”
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Source: https://www.cryptopolitan.com/tencent-taps-tokyo-sydney-nvidia-gpu-hubs/
