Speaker 1: You're listening to Asia Centric from Bloomberg Intelligence, the podcast
Speaker 1: that pulls back the curtain non global business so you
Speaker 1: can invest better across the Pacific realm. I'm Tom Corbett
Speaker 1: in Hong Kong.
Speaker 2: And I'm John Lee. Artificial intelligence, its rapid emergence has
Speaker 2: shaken up the tech world with eye popping potential to
Speaker 2: change the way we work, live, and do business.
Speaker 1: From chips to the cloud, and from data centers to chatbots.
Speaker 1: AI is already plowing ahead, opening up a world of possibilities,
Speaker 1: but also prompting some to waive the caution flag.
Speaker 2: Some estimates value AI's business opportunity in the billions and trillions,
Speaker 2: But what are the risks and can the aigenie deliver
Speaker 2: on the.
Speaker 3: Hype As we start moving more towards AI processing worst
Speaker 3: case scenario by twenty thirty, if things aren't done correctly
Speaker 3: and there aren't any energy efficiency bottles that are implemented,
Speaker 3: it could count ten percent of all of global energy production.
Speaker 1: Let's bring in Woojin Ho, senior tech analyst with Bloomberg Intelligence.
Speaker 3: Woojin Welcome, Hey Tom, thanks for having me on, Hi, John,
Speaker 3: how are you? Hi?
Speaker 2: With Jin which in chat GPT sparked off huge excitement
Speaker 2: on artificial intelligence. Is this hype real and how big
Speaker 2: is this market opportunity?
Speaker 3: I do think the hype is real. I think this
Speaker 3: is very much unlike the metaverse. This is something that
Speaker 3: can increase the productivity for people, and this is why
Speaker 3: we're starting to see a lot of real investment going
Speaker 3: in by the cloud providers like Microsoft, Google, Amazon and
Speaker 3: Meta on the US side.
Speaker 2: And how big is a market opportunity do you believe?
Speaker 3: It's still unclear right because we can look at it
Speaker 3: in multiple different facets. There's an infrastructure side of the
Speaker 3: ledger and there's also a services side the ledger. We
Speaker 3: do know that hundreds of millions of dollars have already
Speaker 3: been invested in it right now not seeing much revenue.
Speaker 3: But if they can start producing revenue or make it
Speaker 3: into a revenue generating opportunity from a service aside, we're
Speaker 3: talking about the scopes of hundreds of billions and possibly
Speaker 3: into trillions.
Speaker 1: Wou jin Ho, you talked about how you believe the
Speaker 1: hype around AI is real. Can we dive down a
Speaker 1: little deeper into that. What are we overlooking or what
Speaker 1: are we underestimating in terms of the potential, the power,
Speaker 1: and the risk.
Speaker 3: Sure, So think about how we're using AI today. It's
Speaker 3: more for efficiency gains, and I think we just started
Speaker 3: to tap into what we can do with AI. Think
Speaker 3: about what AI can do, what chat, GPT and other
Speaker 3: AI engines can do like it. It can tap into
Speaker 3: multiple different databases and come out with an output that
Speaker 3: would probably happen and split seconds that could have happened
Speaker 3: in hours, days or months. Right, So we're talking about
Speaker 3: some massive productivity gains just from the use of AI,
Speaker 3: if it's done and use properly.
Speaker 1: Is it an overstatement to say that AI represents a
Speaker 1: quantum leap in the evolution of tech?
Speaker 3: Still unclear if that's going to be the case, right,
Speaker 3: But it does seem as if it's a step function
Speaker 3: change in terms of tech, much like what we saw
Speaker 3: on the Internet back in the early nineties. And once
Speaker 3: people learn how to use AI and the AI tools effectively,
Speaker 3: you'll see those productivity games potentially in.
Speaker 2: Which companies do you believe stand to benefit from this trend?
Speaker 3: Well, we're already starting to see some of the early beneficiaries.
Speaker 3: It's right now, it's mainly hardware and video is the
Speaker 3: first company that comes to mind.
Speaker 4: Clearly they manufacture or.
Speaker 3: Produce the GPUs, but there's also the compute processing side,
Speaker 3: which Intel as well as a MD and then you
Speaker 3: have some of the networking players like Arrested Networks and
Speaker 3: networking chip guys like Broadcom that produce chips to help
Speaker 3: support the AI side.
Speaker 2: And how much computer power does AI require? For example,
Speaker 2: if we ask a question to Google search a traditional
Speaker 2: search versus a say, an AI powered search like CHATGBT,
Speaker 2: can you give us some sense of how much data
Speaker 2: and searching is required.
Speaker 3: So if we think about the compute power that's needed
Speaker 3: right now, you need the highest available processor and processor speed.
Speaker 3: Now that there are two levels of compute that we
Speaker 3: need to think about. First is actual on the compute
Speaker 3: processing side, and that's where Intel and AMD come in,
Speaker 3: and think about it in the scope of ten to
Speaker 3: one hundred times in compute power to process all of
Speaker 3: the information that's coming through those servers. Right now, we're
Speaker 3: talking about the GPUs which Nvidia offers. The cloud guys
Speaker 3: just can't get their hands or enough GPUs to support
Speaker 3: what they want to do on AI. We're talking about
Speaker 3: thousands and tens of thousands of GPU chips and GP
Speaker 3: aligned cars that they want to support. So we're talking
Speaker 3: about a lot of processing power is necessary just to
Speaker 3: do some high end AI functions relative to general cloud
Speaker 3: computing functions.
Speaker 1: And woujin ho. What constraints do those power concerns impose
Speaker 1: upon AI and its potential.
Speaker 3: Well, that's a challenge here right when we're starting about
Speaker 3: high power compute, we're talking about a lot of energy
Speaker 3: that's being used an dissipated coming out of these servers
Speaker 3: and these data centers. Let me give you a stat
Speaker 3: all the data centers owned by the clouds they generate
Speaker 3: or use up roughly consumer about three percent of all
Speaker 3: of the energy that's being produced globally. And as we
Speaker 3: start moving more towards AI processing, because they are and
Speaker 3: energy suck, that could potentially continue to increase the energy consumption.
Speaker 3: Worst case scenario by twenty thirty, if things aren't done
Speaker 3: correctly and there aren't any energy efficiency models that are implemented,
Speaker 3: it could account for ten percent of all of global
Speaker 3: energy production.
Speaker 4: We're talking about the cloud guys.
Speaker 2: Which think this sounds like a potential environmental nightmare.
Speaker 3: Well, for some of the Bloomberg listeners who are very
Speaker 3: ESG conscious it is really a potential nightmare for the
Speaker 3: cloud guys.
Speaker 2: Could you draw analogies to say cryptocurrency. I read this
Speaker 2: stat that bitcoin usage consumes more power than some mid
Speaker 2: sized countries in the world.
Speaker 3: Yeah, if you think about the bitcoin ecosystem, it's still
Speaker 3: a fairly.
Speaker 4: Concentrated ecosystem if you think about it.
Speaker 3: There are some bitcoin farms that try to build out
Speaker 3: their own servers, but now we're talking about larger cloud
Speaker 3: guys that are trying to build AI farms at a
Speaker 3: larger and grander scale than than a bigcoin server farm.
Speaker 3: We're not talking about thousands of people that are trying
Speaker 3: to mine bitcoin. We're talking about millions and hundreds of
Speaker 3: millions of people to billions of people trying to access
Speaker 3: AI data coming out of the cloud, and the cloud
Speaker 3: guys are trying to support that. I do believe that
Speaker 3: the hyperscale cloud providers are cognizant of that, and they
Speaker 3: are trying to implement new methodologies to reduce the power consumption.
Speaker 4: But that's going to come over time.
Speaker 1: And wou Jinho a lot of those questions about AI
Speaker 1: and chat GPT and the power that they require, the
Speaker 1: US is not the only country that wants to pursue
Speaker 1: a piece of this technology. China is also very interested,
Speaker 1: and you have enough power constraints in China right now
Speaker 1: where that could be an issue for them if they
Speaker 1: go down this road.
Speaker 3: And China has two challenges. One for us is the
Speaker 3: access to the latest generation of chips. And one of
Speaker 3: the advantages of getting the latest generation of chips is
Speaker 3: less power consumption because the smaller geometry chips doesn't consume.
Speaker 4: As much power and it's much more efficient.
Speaker 3: And two you need fewer of those boxes as the
Speaker 3: AI engine becomes more efficient. The issue is is that
Speaker 3: China will not have access to the latest generations of chips.
Speaker 3: There actually, and Video offers a China version of their GPUs,
Speaker 3: whether it's as an Apple eight hundred or the new
Speaker 3: hs In Henry eight hundred, which is the China version
Speaker 3: of those chips, They're just not going to be as
Speaker 3: efficient and power efficient as China. So to compensate, what
Speaker 3: China may need to do is to build more of
Speaker 3: the server and these AI clusters, and that's just going
Speaker 3: to consume much more power. The power needs are just
Speaker 3: going to increase and grow. And to your point, Tom,
Speaker 3: you know China has been a power starved We've seen
Speaker 3: the blackouts during twenty one and twenty two, and if
Speaker 3: that's going to be an issue, the lights might go
Speaker 3: out because they really want to push the AI engine.
Speaker 1: You can see a world of clashing imperatives emerging because
Speaker 1: upwards of two thirds of China's power is generated today
Speaker 1: by coal, which is of course a fossil fuel, so
Speaker 1: you have that factor coming in as well.
Speaker 3: Right, And that's exactly the point, right, It's like you
Speaker 3: have to pick the better of two evils. Do you
Speaker 3: want to really start pushing the AI engine just to
Speaker 3: compete with the rest of the world or the US
Speaker 3: in this case, or do you want to manage and
Speaker 3: conserve energy to support factories on a day to day basis.
Speaker 2: Would you just continue from what you were saying. US
Speaker 2: regulations are prohibiting certain chips to be exported to China, correct.
Speaker 4: That is correct.
Speaker 3: So there are some sanctions that the US imposed on
Speaker 3: US technologies that they cannot ship to China, and Nvidia
Speaker 3: is one of those companies and they actually line itemed
Speaker 3: a couple of Nvidia chips, Nvidia AI chips, the A
Speaker 3: one hundred and above. So what the US is essentially
Speaker 3: trying to do is slow down the progress of China's
Speaker 3: AI development.
Speaker 2: So China can still use certain invidio chips. I think
Speaker 2: you mentioned A eight hundred. Can you compare the eight
Speaker 2: eight hundred to say the most advanced of the A
Speaker 2: one hundred or the H one hundred.
Speaker 3: Sure, So some of the notes that I looked at
Speaker 3: in preparation for this, and it just seems as if
Speaker 3: a lot of it is the interconnect communications between the
Speaker 3: graphics cards, right, that's one. So speed and latency is
Speaker 3: very key for FURAI and also with the processing power
Speaker 3: of those chips as well, so it's not going to
Speaker 3: be as powerful, and that's one of the reasons why
Speaker 3: China may need to have more servers and more GPUs
Speaker 3: to compensate for the less processing power.
Speaker 2: So how many years of generations behind would China be
Speaker 2: in terms of, you know, the usage of these Nvidia chips.
Speaker 3: Well, if you want to add capacity, they'll try to
Speaker 3: keep up as close as possible my senses, and if
Speaker 3: we think about the power dynamic as well, the energy
Speaker 3: consumption dynamic as well, they could be anywhere between three
Speaker 3: to five years behind in terms of the chips itself.
Speaker 1: You're listening to Asia Centric from Bloomberg Intelligence. By the way,
Speaker 1: if you like what you hear, and we hope you do,
Speaker 1: please rate us on Apple Podcasts, Spotify, Google Podcasts, or
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Speaker 1: stars are better. Your feedback matters, and we love hearing
Speaker 1: from our listeners. Our guest is wu Jin Ho, senior
Speaker 1: tech analyst with Bloomberg Intelligence. Wujin The Financial Times ran
Speaker 1: an opinion piece in early May which rather boldly declared
Speaker 1: that Apple is a in their words, Chinese company. They
Speaker 1: argue that Apple is so deeply embedded in China that
Speaker 1: rapid decoupling becomes a rather tall order. How do you
Speaker 1: see that unfolding? Is China going to let Apple just
Speaker 1: go quietly? What are the risks to Apple of moving
Speaker 1: out of China and moving their manufacturing to India and elsewhere.
Speaker 3: That's a fantastic question, tom So, if we think about
Speaker 3: what's happening with Apple in particular, as well as some
Speaker 3: of the geopolitical pressure that the US has started to
Speaker 3: press US manufacturers, it seems as if Apple has.
Speaker 4: Been moving along quite rapidly.
Speaker 3: We actually did a lot of work on the Chinese
Speaker 3: supply chain prior to the ft, and initially we thought
Speaker 3: it was about over ninety nine percent of Apple smartphones
Speaker 3: with manufacturing in China. Now I'm going to give a
Speaker 3: nod to one of my colleagues, Stephen Saying, based out
Speaker 3: of Taiwan. We did another layer of analysis on the
Speaker 3: China supply chain and it seems as if the Chinese
Speaker 3: manufacturers and the assemblers have really started to move out
Speaker 3: of their operations to de risk their geographical exposure.
Speaker 4: It's just as if it's more like close to thirty.
Speaker 3: Five percent of the factories are in China now and
Speaker 3: they've started to move out to the Asian right, whether
Speaker 3: it's Vietnam and Malaysia and as well as a little
Speaker 3: bit more in India. Now, China is still going to
Speaker 3: be a mainstay. I still argue that there's still a
Speaker 3: lot of manufacturing expectise in China because of their multiple
Speaker 3: years of smartphone development and smartphone component development. But at
Speaker 3: the end of the day, the assembly part of it
Speaker 3: and some of the component part of it, not only
Speaker 3: by the US manufacturers, but the Chinese manufacturers have started
Speaker 3: to move things out as well because they recognize the
Speaker 3: geopolitical risk that some of the U S sanctions may
Speaker 3: potentially hold going forward.
Speaker 2: So, currently ninety eight percent of iPhones are assembled in China.
Speaker 2: What's your expectations for say, like five years out.
Speaker 3: Well, ninety eight percent of the smartphones have actually shifted more,
Speaker 3: has accelerated a lot faster, and it could be closer
Speaker 3: to forty percent, you know, in twenty thirty or even
Speaker 3: thirty percent in twenty thirty in China as these assembly
Speaker 3: manufacturing sites move into Vietnam, Malaysia, in India. Now, I
Speaker 3: know India has been a hot button topic recently because
Speaker 3: Apple has been propping up some manufacturing facilities out there
Speaker 3: as well, and India has its advantages, but they still
Speaker 3: have to ramp up in terms of the infrastructure.
Speaker 1: Is India You're ready for that kind of a challenge technologically?
Speaker 3: Technologically there is engineering expertise. The one thing that India
Speaker 3: still needs to build up that that China has and
Speaker 3: India lacks is an ecosystem, right and that will take
Speaker 3: multiple years to build up. The other thing is the infrastructure.
Speaker 3: Where they lag in infrastructure is.
Speaker 4: On the communication side.
Speaker 3: If I look at the speed test, dot net or
Speaker 3: UKULA data, they rank eighty eighth in the world in
Speaker 3: terms terms of high speed fiber optic communications. But if
Speaker 3: we compare it to where China and the US, they're
Speaker 3: fourth and eighth in the world. And I want to
Speaker 3: go back in history where how did China get to
Speaker 3: where it is today as a major manufacturing hub. One
Speaker 3: of the things that China did starting in twenty twenty
Speaker 3: was to lay out the fiber optic networks, and they
Speaker 3: represent roughly one third of all fiber optic investments globally,
Speaker 3: one third. And once you get the communication networks now down,
Speaker 3: then you can start the digital transformation necessary for everything
Speaker 3: else that is touched technologically, whether it's a manufacturing site,
Speaker 3: whether it's a consumer site, whether it's the Internet, and
Speaker 3: so on and so forth. India has yet to be there,
Speaker 3: and India will not get there until twenty twenty five,
Speaker 3: twenty twenty six.
Speaker 1: So the fiber optic network's being laid down, that's the
Speaker 1: tipping point for where China stands today. Would you say
Speaker 1: that's the case or is that an overstatement?
Speaker 4: No?
Speaker 3: I think that China made the playbook. I think Korea
Speaker 3: made the playboat as well. India started to recognize that
Speaker 3: and I would even say that US lags from a
Speaker 3: fiber rollout, and they're really started to lay out fiber
Speaker 3: as well over the next three to five years to
Speaker 3: really build up their digital infrastructure.
Speaker 4: And I do view fiber.
Speaker 3: I know that five G is touted as the communication
Speaker 3: but you cannot have wireless unless you have a wire
Speaker 3: to connect it back to a network. So fiber is
Speaker 3: the key tipping point for digital transformation success.
Speaker 2: Well, jin can Apple effectively detangle from the China supply chain.
Speaker 2: Is the certain parts of the manufacturing supply chain that
Speaker 2: you just cannot get away from China.
Speaker 3: In terms of manufacturing, well, there are several parts. Quite frankly,
Speaker 3: if you look at some of the components where China
Speaker 3: leads in, they lead in LCD panel, screen panel. We
Speaker 3: start to see that ship from Samsung and LG going into.
Speaker 4: BOE and it's mainly manufactured in China.
Speaker 3: If you see the display glass that's manufactured in China,
Speaker 3: some of the acoustics components manufactured in China. And one
Speaker 3: of the things that China smartly did over the last
Speaker 3: couple of years is to double down on legacy, more
Speaker 3: mundane chips, whether it's power management chips, if they can't
Speaker 3: get the advanced node chips that TSMC offers, they're going
Speaker 3: to be the market winners for some of these legacy
Speaker 3: node chips, and for every advanced NOE chip, you will
Speaker 3: need quite a bit of legacy node content inside the iPhones,
Speaker 3: and Apples just can't get away from that either.
Speaker 1: So the idea of Apple decoupling completely from China, you're saying,
Speaker 1: that's probably not going to happen.
Speaker 3: I don't think that's not only an Apple statement. I
Speaker 3: think that's a global electronics statement. I think the aspirations
Speaker 3: are there, but I do think that China is going
Speaker 3: to be a last thing manufacturing partner over the long term.
Speaker 2: Was you if I could circle back to artificial intelligence
Speaker 2: or AI, which Asian companies stand to benefit from this trend?
Speaker 3: Well, let's start from the bottom up. It's going to
Speaker 3: be the server companies predominantly. They will be getting the
Speaker 3: large GPU line cards and chips from Nvidia and Intel
Speaker 3: an AMD. But it will be a companies someone like
Speaker 3: an Insper or a Lenovo or an H three C
Speaker 3: those other companies. But if we start moving up the
Speaker 3: chain on the services side, it's going to be someone
Speaker 3: like a buy Do or Tencent as they build out
Speaker 3: those AI services and try to offer it to the
Speaker 3: local economies and local regions.
Speaker 2: And what about on the hardware side, Well, on.
Speaker 3: The hardware side, it's going to be inspur Lenovo H
Speaker 3: three C, as much as I want to say someone
Speaker 3: like a Huawei.
Speaker 4: On the networking side.
Speaker 3: There's somewhat negatively impacted because of the US sanctions as well.
Speaker 3: They just don't have the access to the technologies on
Speaker 3: the networking side as they hope. So if anyone's going
Speaker 3: to benefit from the networking side, it's probably going to
Speaker 3: be H three C.
Speaker 2: And what about the Asian cheap makers like Taiwan Semi,
Speaker 2: TSMC or Samson Electronics or esk Heinex.
Speaker 3: So if we think about it from the chip maker front,
Speaker 3: AI needs a lot of advanced process notes and TSMC
Speaker 3: is going to be the leading beneficiary right now because
Speaker 3: they make the five nanometers seven animeter and in line
Speaker 3: for the threes and the two animeters, and for AI workloads,
Speaker 3: you actually ead a lot, a lot, a lot of memory.
Speaker 3: And if we think about ske Heinex and Samsung not
Speaker 3: only the DRAM side, but also on the nan side,
Speaker 3: they are going to be the biggest beneficiary among the
Speaker 3: Asian technology.
Speaker 1: Providers, wujin Hole. Could it be that we don't know
Speaker 1: what we don't know about AI and chat GPT and
Speaker 1: its potential and how would you compare its emergence today
Speaker 1: with the way the Internet emerged in the early to
Speaker 1: mid nineteen nineties.
Speaker 3: So there's a lot that we don't know, to your point,
Speaker 3: that we don't know going out twenty thirty years from now,
Speaker 3: sure in terms of what chet chipee can do, how
Speaker 3: it'll evolve. If we think about what the early Internet
Speaker 3: was in the nineteen nineties, it was basic email, right.
Speaker 4: And then it evolved.
Speaker 3: To very simple graphics to virtual.
Speaker 1: Realities, a clunkier version then of what it is today.
Speaker 4: Exactly much clunkiler version.
Speaker 3: But if you think about what the Internet actually provided
Speaker 3: back in the early nineteen nineties, it created a whole
Speaker 3: vast of news services. We could imagine a service like
Speaker 3: an Amazon or an Uber, or food delivery services like delivery.
Speaker 3: Let's just say back.
Speaker 1: Then, it's not just the technology, it's the way it's
Speaker 1: applied exactly.
Speaker 3: I don't know how people are going to apply AI
Speaker 3: going forward. There are some scary aspects of it in
Speaker 3: terms of the productivity gains of AI will lead to
Speaker 3: potential job losses, but it might be productivity gains that
Speaker 3: we can really leverage and there might be more jobs
Speaker 3: created as a result of that.
Speaker 4: So it's just I don't know.
Speaker 3: What's going to happen in the next five, ten, twenty
Speaker 3: thirty years from now from the evolution of AI.
Speaker 1: But those productivity gains could also bring with them investment
Speaker 1: opportunity exactly, economic growth, and all the things that go
Speaker 1: on with that exactly.
Speaker 3: It can actually be seeds to new industry. It could
Speaker 3: be seeds to new technologies that AI was able to
Speaker 3: discover in the speed of years which would have been decades.
Speaker 3: So it depends on how companies implement AI and how
Speaker 3: they leverage the technology to really drive growth going forward.
Speaker 3: And I think every company. Look, I understand that the
Speaker 3: cloud guys, whether it's either the US or the Chinese
Speaker 3: on the China side, have gotten a lot of attention,
Speaker 3: but I know that a lot of corporates are trying
Speaker 3: to figure out new ways or ways to leverage AI
Speaker 3: for their own benefit and we'll see what.
Speaker 4: They do with it.
Speaker 2: Which there seems to be a lot of press on
Speaker 2: how AI can help with the search functions like Google Microsoft.
Speaker 2: Do you see a point where people actually pay to
Speaker 2: have subscription to these services.
Speaker 4: Yes, but not for a search function.
Speaker 3: I do think that again, going back to how AI evolves,
Speaker 3: I think there will be new services that may blossom
Speaker 3: out of AI that will.
Speaker 4: Be paying for GO going forward.
Speaker 3: Right, That's one of the I guess unknowns over the
Speaker 3: next three or five years on how to monetize AI
Speaker 3: because there's a lot of investment that's going in. We're
Speaker 3: talking about billions of dollars of investment, whether it's on
Speaker 3: the infrastructure side, of the software side, or development time.
Speaker 3: But if it's going to create the efficiencies for the
Speaker 3: end user, they want to really monetize that investment. And
Speaker 3: sooner or later it's going to come. I just don't
Speaker 3: know what shape or form it's going to come in.
Speaker 2: It sounds like you need a lot of investment to
Speaker 2: build out AI, and a lot of these investments being
Speaker 2: made by cloud providers. Can corporates get into the action
Speaker 2: as well?
Speaker 4: That's a fantastic question, Johnny.
Speaker 3: The way AI is structured, you just need a bunch
Speaker 3: of servers, a lot of memory, some GPU, Right, that's
Speaker 3: a fairly and software that sits on top of it.
Speaker 3: What the cloud guys are investing in right now is
Speaker 3: a large scale AI engine that could support millions of people.
Speaker 3: I do think that the corporates can do this. I
Speaker 3: think there's a lot of interest in corporates building in house.
Speaker 3: Traditional hardware vendors will be beneficiaries of it, like a
Speaker 3: Dell or an HPE on the US side, someone like
Speaker 3: an IBM on the US side. Again, someone like an
Speaker 3: Inspirament Lenovo would be a beneficiary. Now, why would a
Speaker 3: corporate want to build out their own AI infrastructure, Well,
Speaker 3: they could do one or two things. They could outsource
Speaker 3: it to the cloud guys, to the cloud providers, and
Speaker 3: the cloud providers offer it as AI as a service.
Speaker 3: And going back to your question about how do they
Speaker 3: monetize it, that would be one way of monetizing it, right,
Speaker 3: But there's some challenges to that, and I think there
Speaker 3: were some recent news about Samsung leaking some data because
Speaker 3: some of their employees were using chat GPT. We've seen
Speaker 3: Apple band the use of chat GPT internally as part
Speaker 3: of the development. So there are some inherent risks, especially
Speaker 3: if we're going to use AI with corporate IP and
Speaker 3: they may want to build some of that in house.
Speaker 4: Would it be cost effective?
Speaker 3: It may not be right, but the risks could be
Speaker 3: far greater than the events smith itself, and then the
Speaker 3: reward could be far greater by building it inside as well.
Speaker 1: Woo Jen All this raises questions about regulation. The AI
Speaker 1: genie is out of the bottle. How do we rain
Speaker 1: it in? How do we channel its power to constructive purposes?
Speaker 1: How do you see that unfolding?
Speaker 3: I think it's already started to happen, especially on the
Speaker 3: US side. We're starting to see the regulatory environment try
Speaker 3: to work with the cloud providers in terms of trying
Speaker 3: to rein it in. First of all, it's going to
Speaker 3: take some time for the regulators to understand what it
Speaker 3: is and what it may mean to do, and the
Speaker 3: guidelines continue to change over time, primarily because the definition
Speaker 3: of what AI can do continuous change daily as well.
Speaker 3: I think the same thing is happening in Asia, but
Speaker 3: it's still too early on what those guidelines may be,
Speaker 3: and it's probably going to be on a region by
Speaker 3: region basis, much like what we're seeing on how countries
Speaker 3: are handling data privacy laws for users on the Internet.
Speaker 1: Woo Jen Ho. It's been remarkable having you here. We
Speaker 1: covered a lot of ground talking AI chips, China investment,
Speaker 1: and these are just the opening chapters in a story
Speaker 1: of exciting change and remarkable business opportunity. We look forward
Speaker 1: to staying in touch and hearing more of your insights.
Speaker 4: Thanks for having me, guys, Thanks for.
Speaker 1: Jin I'm Tom Corbett in Hong Kong.
Speaker 2: And I'm John Lee. This podcast was edited by Clara
Speaker 2: Chen and you've been listening to the Age Eccentric podcast