Why Nvidia’s Hugging Face deal is about much more than chips
Nvidia has announced a $12.9 billion acquisition of Hugging Face, a leading platform for open-source AI models. This move aims to solidify Nvidia's position in the AI ecosystem by controlling the infrastructure used by millions of developers.
Why it matters
Consolidation in the AI sector by hardware giants signals a shift toward controlling both the physical chips and the software repositories that power modern AI.
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Yesterday, Nvidia confirmed what we all already knew.
The company is planning to acquire Hugging Face , a New York-based startup which has built a repository for open source AI models and recently shot to global recognition after it came under a cyberattack by rogue OpenAI models.
The price tag was a cool $12.9 billion, making Hugging Face Nvidia's second-biggest purchase, after it paid $20 billion for chipmaker Groq's assets.
That nearly $13 billion valuation was what it took to fend off other bidders, Nvidia CEO Jensen Huang told CNBC on Thursday.
So why did the world's most valuable company splash the cash for Hugging Face?
To understand that, first we need to break down what Hugging Face actually does.
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