'The market will look for alternatives,' on Huang resignation says Andrea Renda, Digital Economy expert

NVIDIA is at the center of the global artificial intelligence revolution, but the American chip giant is now facing an extraordinary crisis following the shock resignation of its CEO Jensen Huang amid allegations of an espionage scandal. The implications could go far beyond one company's leadership, raising serious questions about corporate security, China's intelligence ambitions, and America's technological supremacy. To answer all these questions, I'm now joined by Andrea Renda, head of research at the Center for European Policy Studies here in Brussels. Good morning. Always great to have you on. Good morning. So let's go right to it. Jensen Wang's resignation, certainly the end of an era. Could this become a major crisis for the entire global AI industry? The answer is yes, because Jensen Huang is not just basically the tech leader of the past few years, the person that has led the company that was doing GPUs for video games into becoming the backbone of the modern AI revolution, but he is also A diplomat, a tech diplomat for the United States around the world who's been striking deals, who's been sitting with presidents everywhere. So there is a soft power in Jensen Huang, which is also driving the whole AI industry. And his policy of buying shares or facilitating the rise of other companies around its ecosystem has really created something that sustains itself, also because Jensen Huang has been really somehow the master of puppets of everyone. So, now that you mentioned it, how much damage could this scandal do to the confidence, to the global AI community, particularly investors and governments? I think it's early days. This scandal could remain self-contained to the position of Jensen Huang. NVIDIA, of course, is a fantastic company, is a very solid company, can continue, it will continue producing its chips. But there is a value. To a CEO, to a very charismatic CEO of a company, which is enormous. We've seen that with Sam Altman, with others. I mean, the markets have been valuing enormously these figures. So with the loss of confidence and also the loss of strategic positioning, Thank you. NVIDIA is considered to be structurally important and strategic for the whole of the United States. You know, the whole AI industry might lose its trailblazer. and its leader and this might mean everyone will now look for alternatives and this might lead to a slowdown in the whole industry. Is China's intelligence apparatus now playing a much more sophisticated game here, not only targeting technology but also the people who control it? I think China has been very sophisticated in building its own AI industry. It uses everything. I'm not sure it uses spies as well. I think there is much more to this story that we will discover in the coming days. There will be an investigation and so on. So it's early days. It's not necessarily about Chinese spying. It's about selling chips to China and dodging export controls. So there are two sides to this story. We will discover whether it's actually China. orchestrating all this, or it's actually a businessman with the sort of tacit consent of the U.S. administration managing to do business in a very successful way across the world. Interesting. And what should Europe take away of all this? Well, I've been critical in the past of the excess dependency on one supplier and Europe's factories and future gigafactories have featured. I think we should diversify. We should make sure that we don't depend on one single supplier. And also, we should make sure that gradually we build our own internal capacity to produce chips or source chips from trusted partners. Now, this is not going to change for the time being. NVIDIA chips are the leading ones in the market. And if we want to build our own tech leadership over the coming years, So should continue purchasing those chips, but also trying to look for alternatives and also trying to be a bit smarter on the global market. And finally, who benefits from this crisis, briefly? Well, the only ones that so far stand to benefits, well, certainly some of the Chinese companies might, although they might not be able to use the NVIDIA chips that they've been using for years. Definitely the tech giants, the old ones, we might say, once we were calling them the new ones, right, Alphabet or Microsoft. That are building their own chips. They're recently also releasing very important chips. Also, OpenAI has been building its own chips. They might stand to lead because the whole market will look for alternatives and they are very attractive. All right, André, a fascinating conversation. We'll continue with that one day. And that does it for us today. I don't know.