Jensen's purchase of a new toy could reshape the entire AI industry — This week on The Kettle we weigh in on Nvidia's Hugging Face acquisition and why it could spell a new, more fragmented and siloed era of AI development
KETTLE AI repository Hugging Face will soon be an Nvidia property, and while everyone's promising things will remain the same we at The Register's Kettle desk aren't so sure the status quo is going to stay the status quo at the AI industry's leading open model host. 
Joining host Brandon Vigliarolo this week is reporter Dan Robinson, who broke the news of Nvidia's $12.9 billion acquisition for El Reg yesterday, weighs in on what he heard during the announcement call, while senior reporter Tom Claburn opines on what he sees coming. 
Hello and welcome to another episode of The Register's Kettle podcast. I'm Reg reporter Brandon Vigliarolo, and if you've been keeping an eye on things the past few days, you probably already know what the big tech news story of the week is, and that's Nvidia's $12.9 billion acquisition of AI repository Hugging Face. With me to discuss this deal and what it might mean for the future of the AI sector for both companies and developers is our reporter Dan Robinson and senior reporter Tom Claburn. Thanks for coming on, guys.
All right, so Dan, you broke this story, I think it was just yesterday now, and you were on the conference call that Nvidia and Hugging Face leadership held. So break it down for us. What was the agreement here? What's the deal?
Well, like you said, it was a $12.9 billion purchase from Nvidia to acquire Hugging Face, which is the home of open AI, as I've been told.
Open source and open weight. I just want to make sure it's not the home of OpenAI, the company, right?
Yes, let's not get confused about that. They've entered into this agreement which is due to close next year, providing that they meet all the regulatory requirements, of course, and there are no objections from the authorities on that. It looks like Nvidia's agreed to keep a hands-off approach and allow Hugging Face to pretty much just do what they're already doing.
But as we've been seeing, there are quite a few concerns around that, as Nvidia is a very powerful company in the AI market. And Hugging Face is the go-to place for open models.
I'm sure most of our listeners know what Hugging Face is; it's essentially the GitHub for the AI space. It hosts models, and new open models tend to show up on Hugging Face first. There's also a pretty active community that discusses the development of these things on the platform.
So this is obviously a pretty consequential move in this space and I know both Nvidia and Hugging Face framed it as giving Hugging Face more resources to pursue its mission. I think Clement, the CEO of Hugging Face, said that they want to reach a hundred million developers in the next few years and that they were worried that they wouldn't be able to without more resources.
Let's be realistic. They're hosting a lot of very large AI models and all the data sets they contain. That's a lot of storage space and a lot of computing resources, not to mention serving and dealing with all the workloads that come with this. I imagine that could eat up a lot of cash and resources.
Of course. And it's quite an ambitious goal given that they're at about 80 million users, I think it's estimated at the moment. And if you compare them with someone like GitHub, I think they are somewhere around 180 million since they've been taken over by Microsoft.
And we've seen how well that's worked in the past few months with the stability issues and everything. It kind of begs the question too whether or not, if you get that big, can you remain stable and would Hugging Face end up suffering from some of the same problems that GitHub does?
I wonder how long Hugging Face is going to continue to be flooded with new models because the models are appearing daily at Hugging Face. But what are the economics for making them? A lot of these companies are presumably not generating the revenue to pay for the cost of these models. And at some point, what are the economics of just giving away these models? Nvidia I think clearly sees that there's a future in the enterprise business where companies are going to want to control their own AI and run it. But is the pace of model development going to continue on into the future because where does all the money come from to pay for this?