Big Technology Podcast
00:05:33 · Alex Kantrowitz
US companies will always have access to that that infrastructure. If they move to different infrastructure and make advances on, let's say, Chinese chips from Huawei, and China restricts those chips to The United States, then The United States will not have access to, to that infrastructure potentially. So that's why Jensen has always said, it's important for everybody to be on The US system or GPUs. Of course, that means Jensen sells more GPUs because he's the one who's building them. But that's sort of beside the point. So obviously, he made contact with this woman, Alice Huang, you know, seemingly in the normal course of events, nothing really suspicious about how they met or the work they were doing. The only thing in this story that really goes wrong is, is they become close. They have an affair, and it doesn't stop there. The fact that Xi has, according to US government sources, had a connection with Chinese intelligence and was passing information along to them makes this a very big deal because, of course, Jensen Huang is not only the CEO of the most important AI company in The United States and the world for that matter. He's also a top confidant and ally of president Trump, a top friend of president Trump. Remember, president Trump called him in the middle of a panel at the All In Podcast. And so having a... Having somebody from your intelligence services or working for your intelligence services very close to him opens up all routes to understand not only the plans to build your your chips, the policy discussions happening in The United States, but it's also just a good asset to have just in case, you know, you wanna take that company down a peg. Okay. So this is this is the setup. It's a classic honeypot setup. I think we've been good on the show about talking about honeypots. It's one of the things we've covered, you know, both seriously, and, we've kind of enjoyed the concept a little bit over the past couple weeks. But but the bottom line is if the reports are all true, it looks like Jensen fell right into a honeypot. So now that he has, the question is, what does it mean?
00:07:48 · Alex Kantrowitz
There's a tremendous amount of uncertainty around Jensen's future and NVIDIA's future and the AI build out's future because we don't really have situations like this where the leading executives in the most important companies end up in bed with adversarial nation spies or at least we don't hear about it so often. So if that's what happened, there are going to be some issues. So a couple of things I wanna share. First of all, about Jensen. I don't think there's any executive, as much of a single point of failure within an important company as Jensen Huang. Remember, he co founded NVIDIA in 1993. He has about 60 direct reports, he said, and he has managed these relationships both with partners and competitors, buyers, and governments for a long time. He's been central to the NVIDIA story. He believed that GPUs were going be very important technology when a lot of people wouldn't give NVIDIA the time of day, and he is the center of that company. It is a Jensen company. And so any any problem with Jensen is really a problem for NVIDIA, a big problem. And especially, you know, if he ends up being removed or he steps down as the leader of this company, some people have suggested they don't really understand how NVIDIA would continue. Now his children are working there, but I don't know if they're ready to take on his role. Now I do have a take about whether Huang will step down or be pushed out, but that will wait, I think until the very end here. That'll be my punchline. So so stick with me a little bit as I try to point out the most important issues here, and what might happen. So just to set the table here, I think it's important for anyone who says Jensen Huang's affair with Alice Huang is just a simple affair or they're hoping for a simple affair the way that Bill Ackman suggested. I think they need to get their head checked. This is not just a simple affair. This is an affair with someone that the US government believes was associated with Chinese intelligence services. Right? They she... They believe she was a spy, whether that's somebody who was, like, hired directly by them or passing information along. It doesn't matter. Is this someone who was compromised? And and so was Jensen. Now Jensen was as compromised as can be because when you have a secretive affair with somebody, they can hold it over your head.
00:10:18 · Alex Kantrowitz
You put yourself in a position where they've got something on you, and then you're sort of... You're you're beholden in a way to their wants and interests. So I I think those who believe that this was a simple affair, they simply aren't seeing the full picture. This is not a marriage issue. This is not a family issue though. It certainly is that it's not that alone. It is a corporate security issue. It's a national security issue. Now, you know, many people have said that this is not as big of a deal as people are making it out to be because Jensen by definition was going to be anti export controls. He had been advocating to sell more to China as a matter of it was a course of business. And so of course, like it's not like the government of China was going to cajole him into doing this with, you know, by by setting him up with some... With a member of intelligence. The writer, Bill Bishop, of cynicism disputes this, and and I think he's totally right. Now remember, Jensen is a text buddy of president Trump. Jensen is the keeper of a lot of super confidential design and information, you know, within NVIDIA. Here's what Bill writes. He he says, and I think this is fair, was she ever alone with his phone or computer? Say when he got up to go to the... To use the bathroom. Right? You have a guy who president Trump is calling mid panel, probably texting him as well. In the bedroom, yeah, you get up, you go you go use the bathroom, you go take a walk, you go, I don't know, get something to eat from the fridge. There's all possibilities to compromise the security of the phone or the computer you leave behind. I'm not saying this happens, but the point is it didn't need to be Jensen's intent. It didn't need to be his, you know, express interest, to to share information he didn't wanna share. When you're in a position like that, it can happen and you can't rule it out. And I think that's why when the board the board had a very interesting quote about this. They said, effectively, we have no reason to believe that there's anything, you know, effectively that has been shared about NVIDIA or US security interests, solicitly. Yet you can have no interest, no reason to believe that that stuff happened, but it could still have happened. And if it happened, it's a problem. So the corp...
00:12:45 · Alex Kantrowitz, Dario Amodei
The culprit here could be sloppiness, not exactly, you know, explicit leaking from Jensen doing pillow talk and like saying, hey, we're gonna build these data centers here or The US is gonna vote this way or that way. There are so many different permutations of what could be shared, but I think that's important. Now when we think about the immediate issues that are gonna hit here, Jensen has been the most effective advocate against export controls to China and The United States. He has taken the gloves off. He's gone at it with people like Dario Amodei. Right? We had Dario on my show last year and Dario was very clear that he believed in export controls. You know, this idea that, you know, Jensen has had put forth that Dario wanted to control the industry. Dario hit back on, you know, very hard. I'm sure you've heard the criticism from people like Jensen who say, well, Dario thinks he's the only one who can build this safely and therefore, speaking of that word control, wants to control the entire industry. [00:13:50] S5: I've never said anything like that. That's an outrageous lie. That's the most outrageous lie I've ever heard.
00:13:57 · Alex Kantrowitz
[00:13:57] S0: So there have been relationships that Jensen has risked in order to push forward this idea that there shouldn't be export controls on GPUs. And and he has he has effectively been very successful on it. Last year, the Trump administration lifted a ban of selling NVIDIA's h 200 chips to China. Now there are some risks there. There have been some stories recently about how, those those chips have have been sold to companies and people have visited their supposed offices or data centers and they've been empty. So effectively you can end up selling to an approved client and they can end up being funneled somewhere else. Basically, So when you get those out in market, they can be available to everybody. But Jensen has pushed for it. He's been successful on it, and NVIDIA has flourished as a result. Right? NVIDIA, when we woke up this morning, was a $4,500,000,000,000 company and who knows where it ends at the end of the day. But because it's been able to open up the market in China, that's been a big part of its growth and of course the demand in The United States. Right? So now it's very interesting. Imagine Jensen Huang says something about export controls to China. Who can take him seriously? Seriously. Is anybody gonna take Jensen seriously? If he says anything logical. Right, if he if he makes an argument like he made on the podcast about why people are, you know, overreacting about export controls, think anyone's gonna be like, yeah. That makes sense and just take it on its merits? You know, even if none of the accusations, well, he already did admit that he was in the... Having the affair. But even if that's where it ends, it's hard to imagine that, that his voice on export controls is gonna carry a tremendous amount of weight, at least for a little bit and maybe forever. And if further export controls are put in, by the US government, that's rough. It'll hurt NVIDIA's business. So that's definitely something to watch here. Now, speaking of the US government, very interesting situation right now because Jensen's Jensen's scandal could not have happened at a worse time frame. Think about the situation in The United States. Not even a week ago, the Democrats swept to power in Congress, winning the House and the Senate. They did so on a number of messages against inflation, against cost of living, against the Iran war.
00:16:26 · Alex Kantrowitz
But for anywhere between, let's say 2760% of people, AI data centers and the rise of AI was a crucial issue. We know this and the Democrats have represented the, the fight against AI, right? They've been more anti AI than the Republicans. Now hearings were inevitable. We were going to see hearings. We've talked about that on the show. They were inevitable. Oh goodness. Are they going to have a juicy first target? So think about it this way. The Democrats are going to come in. They're going to have an anti AI agenda. They're going to try to look for some very prominent AI leaders to basically bring in front of their committees and publicly roast. Who's the first one? That was the question we had up until, I don't know, twenty four hours ago. I believe the answer is clearly gonna be Jensen Huang. Think about this. He's high profile. He's basically the face of the AI build out. He's a friend of Trump. He took a... Taking phone calls from Trump, you know, in the middle of of conferences. Yes. It would be, you know, it it would be, like, as symbolic as it gets to get him up there and and beat him up over an issue that's gonna be very, very difficult for him to defend himself on. So you could think about the staffers, of the senators and members of congress today that are already licking their chops thinking about the YouTube clips and the x posts that they'll have where their bosses will get a chance to lay into Jensen for for effectively... Well, not even effectively for... Well, again, the language on this is hard, but for sleeping with somebody who who the US government believes is a spy for China, you know, and not only that and lying about it. Jensen, for instance, when he went to the... When him and a spokesperson went to the New York Times and Bloomberg, they said there was nothing unusual or unexpected about the relationship. Can you just imagine senators sitting up there and being like, you didn't know if you, you know, you didn't know that you that you were being infiltrated this way. You said it was unusual. You said it wasn't, it wasn't unusual. You said it wasn't expected. What exactly did you find out? If you can't know that you're sleeping with someone who our government believes is a Chinese spy, how can you be trusted to protect any national security secret? Why should you have security clearance if you do?