The GPS Blackout That Changed Everything for China

A CCTV program revealed on June 8 that the United States cut off GPS navigation signals in the early 90’s and left a Chinese cargo ship stranded and adrift in the Indian Ocean for 33 days. The vessel was ultimately forced to accept a boarding inspection by U.S. personnel — and the humiliating episode gave China a sobering lesson in the strategic importance of navigation technology, setting the country on the arduous path of developing its own BeiDou satellite system.

"Changan Street Insider" — a WeChat public account under Beijing Daily — reported that CCTV disclosed the 1993 incident during a program titled "Spacesail Constellation Accelerates Network Deployment: China's Low-Orbit Satellite Internet Launches Its Strategic Breakthrough." The program laid bare how the U.S. leveraged GPS as a strategic chokehold on China.

In 1993, the U.S. cut off GPS signals — leaving China's cargo vessel Yinhe adrift in the Indian Ocean for 33 days, then forced into a U.S. boarding inspection.

As China's cargo vessel Yinhe was sailing through international waters in the Indian Ocean, the United States abruptly cut off GPS signals in that sea area. The Yinhe lost all navigational bearings and drifted helplessly for 33 days. It was then forced to submit to a U.S. boarding inspection.

This was not an isolated incident. The repeated episodes drove home a single, unambiguous conclusion for China: the lifeline of positioning and navigation must be in its own hands. From that point on, China embarked on the long and difficult road of independently developing the BeiDou system.

The episode was a wake-up call: China's navigation lifeline had to be its own. BeiDou was born.

In 2020, the BeiDou-3 global network was completed, and China finally reclaimed control over its own navigation. But even as that battle was won, a new one was opening — and the window was closing fast.

In low-Earth orbit, the available space and timing for China become more limited by the day. Elon Musk's Starlink has been occupying that territory at an unprecedented pace. As of June this year, Starlink has more than 12,400 active satellites in orbit — accounting for over 60% of all active satellites globally.

China is also facing a rapidly closing window of opportunity. The International Telecommunication Union operates on a "first filed, first served" principle. Whoever launches first and begins providing service wins priority rights — and the clock ticks for everyone equally.

China launched the Spacesail Constellation program in 2021.

In 2021, China began developing the "Spacesail Constellation" — formally named as the Global Multimedia Satellite System. Its primary target markets are countries co-building the Belt and Road Initiative, Chinese companies expanding overseas, and regions that Starlink cannot reach or has been cut off from due to political factors.

Spacesail is now launching at a relentless pace — and closing the gap fast.

The Spacesail Constellation is planned in three phases. Phase one targets 1,296 satellites, expected to be completed by 2027. Phase two will add approximately 10,000 more satellites, with the aim of exceeding a 10,000-satellite network by 2030. Phase three ultimately targets more than 15,000 satellites, supporting integrated multimedia and remote sensing capabilities within the 6G ecosystem.

In late 2025, China filed to register orbital resources for 203,000 additional satellites across 14 constellations.

In December 2025, China submitted a filing to the ITU that sent shockwaves through the global aerospace community. The application sought to register frequency and orbital resources for an additional 203,000 satellites, covering 14 satellite constellations including both medium and low-Earth orbit satellites. It is the largest concentrated international frequency and orbital registration submission China has ever made.

Every satellite launched under the Spacesail Constellation is filling a closing window of time. From the first experimental satellite in 2003 to the intensive launch campaigns of June 2026, the Spacesail Constellation is catching up at a visibly rapid pace. This is not merely a commercial race — it is a strategic breakthrough that China cannot afford to lose.

Mao Paishou

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Washington is threatening to sanction Chinese AI models. Nvidia CEO Jensen Huang just told Axios something very different. In an exclusive interview in Fort Worth, Texas on July 21, Huang said US companies should be "absolutely" allowed to use open-source Chinese AI models. He went further: the odds that Chinese firms drive American companies out of business are zero.

Huang's answer was one word: "Absolutely." US firms should be allowed to use Chinese AI.

Huang's comments read like a direct warning to hawks in Washington pushing for a ban. The trigger was Moonshot AI's July 16 release of Kimi K3, a 2.8-trillion-parameter model and now the world's largest open-source system. Its aggressive pricing and upcoming open-weight downloads set off the sharpest wave of AI panic since DeepSeek rattled markets in early 2025. Kimi K3 beat Anthropic's Claude Opus 4.8 on multiple benchmarks, and chip stocks including Nvidia sold off on fears that cheaper, more efficient models would undercut the massive global bet on AI infrastructure.

The fallout came fast. US Treasury Secretary Bessent and Trade Representative Greer both spoke out the same day. Bessent told Fox Business that US authorities had found watermarks from American large language models embedded in several Chinese AI systems, calling it "unacceptable" and promising an investigation. Greer said Washington would examine whether China gained its edge through unfair means.

Bessent: “US watermarks found in Chinese AI models.” An investigation is coming

US media reported earlier that the White House is weighing a new executive order to restrict open-source AI, particularly systems from Chinese companies. The Commerce Department had already considered adding several Chinese AI labs to its Entity List last year.

Huang's logic cuts the other way. "The market misunderstood the impact of DeepSeek the first time," he told Axios, adding that Wall Street has "misunderstood the impact of Kimi again this time."

Kimi K3's launch rattled the entire AI industry.

Free, cheap open-source models, according to Huang, let AI reach far more consumers and businesses. That, he argued, drives strong demand for chips, data centers and computing power. "Free AI should be great for hardware," Huang said. "Free AI should be great for chips. Free AI should be great for data centers."

OpenAI and Anthropic have no reason to fear open models either, in Huang's view. Open-source systems expose more people to AI for the first time, which expands the whole market. Many of those users, he added, will still end up paying for the reliability and convenience of closed commercial services.

On security, Huang rejected the idea that downloading a Chinese model opens a backdoor to Beijing. Companies can fully customize and control access inside secure sandbox environments, he said.

Wong argued openness actually works the other way: outside researchers can inspect models, spot weaknesses and build defenses. "If everything just becomes one single model, one single point of attack, one single source of failure, I think the world is much, much more vulnerable."

Huang also called on Anthropic to open up its restricted cybersecurity model, Claude Mythos, rather than keep it locked down. "Holding Anthropic back is not in the benefit of the United States," he said, "Open models are available anyhow. So I think: Let Anthropic run."

On the US-China AI race, Huang staked out a position sharply at odds with Washington's. He rejected the idea that AI competition has a finish line. "We're going to continue to use AI forever," he said. "The United States is going to be here for a long time. China's going to be here for a long time."

Bloomberg cited several analysts drawing a contrast with the 2018 ban on Chinese 5G equipment. Freely downloadable, highly customizable software models have already embedded themselves deep in Silicon Valley's ecosystem. On OpenRouter, a platform offering access to multiple AI models, Chinese models now account for nearly 60% of token usage by US companies.

The adoption numbers back that up. DoorDash, Airbnb and Germany's Siemens have all shifted to Chinese models. More than 80% of US AI startups now make heavy use of Chinese models such as DeepSeek and Zhipu's GLM, with usage share holding above 30%, up from just 11% a year ago.

Nathan Lambert, an AI researcher at the University of California, Berkeley, put it bluntly: any form of ban would be a serious mistake for AI's long-term development.

Morgan Stanley believes the growth cycle in global AI computing demand is far from over. Bernstein estimates that even if Kimi K3 cuts single-run training costs by roughly 40%, competitive pressure pushing firms to double their training frequency could still lift total computing demand by around 20%.