WEBVTT - Microsoft and the UAE’s G42 0:00:01.600 --> 0:00:06.920 From Mahard where Innovation, money and power collie in Silicon Valley, NBN. 0:00:07.240 --> 0:00:11.280 This is Bloomberg Technology with Caroline Hyde and Ed Ludlove. 0:00:24.840 --> 0:00:27.360 I'm Caroline Hyde at Bloomberg's world headquarters in New York. 0:00:27.840 --> 0:00:31.120 I'm Ed Lovelow in San Francisco. This is Bloomberg Technology 0:00:31.240 --> 0:00:31.680 coming up. 0:00:31.800 --> 0:00:35.199 Microsoft to invest one and a half billion dollars in 0:00:35.240 --> 0:00:36.879 a UAE top AI firm. 0:00:36.920 --> 0:00:37.760 It's G forty two. 0:00:38.080 --> 0:00:41.239 That's the US government pushes the Abu Dhabi business to 0:00:41.400 --> 0:00:44.600 end all cooperation with China. We analyze the business and 0:00:44.640 --> 0:00:45.720 the political drivers. 0:00:46.680 --> 0:00:49.519 Europe has its eye on fintech and crypto. We sit 0:00:49.600 --> 0:00:52.599 down with the EU's Commissioner for Financial Services on her 0:00:52.680 --> 0:00:55.440 visit to Silicon Valley. Is ais all the rage in 0:00:55.600 --> 0:00:56.760 bank earnings, and. 0:00:56.680 --> 0:00:59.400 We digest a two hundred and fifty million dollar fundraise 0:00:59.480 --> 0:01:02.560 for a Silicon Valley chip developer, Revos, which is yet 0:01:02.600 --> 0:01:05.240 to bring about its first product. We discussed the race 0:01:05.240 --> 0:01:07.880 for AI infrastructure and so much more. Throughout this hour, 0:01:07.920 --> 0:01:10.959 we focus, though, just on the public markets, which in 0:01:11.000 --> 0:01:13.720 the United States relatively sanguine right now, and the NASDAC 0:01:13.800 --> 0:01:14.880 is off just by about. 0:01:14.640 --> 0:01:15.679 A quarter of a percent. 0:01:16.000 --> 0:01:18.399 The action is actually what's happening in Asia and Europe, 0:01:18.400 --> 0:01:21.440 trading both those benchmarks under a lot of pressure following 0:01:21.440 --> 0:01:23.080 some sell off that we've seen in the US. But 0:01:23.120 --> 0:01:25.919 really what's been happening also in the bond market, yields 0:01:25.959 --> 0:01:28.080 up three basis points on a two year yield that 0:01:28.160 --> 0:01:30.720 at one point was very close to the five percent level. 0:01:30.720 --> 0:01:32.440 We're all eyes on j Powell what. 0:01:32.440 --> 0:01:34.959 He sees for the future of FED policy when we've 0:01:34.920 --> 0:01:38.360 still got such a resilient US economy and inflatory pressures. 0:01:38.400 --> 0:01:39.800 Moving on, have a look at what's happening in the 0:01:39.840 --> 0:01:42.399 world of as a dollar that rises for five straight 0:01:42.480 --> 0:01:45.240 days and having the best run in at least a year. 0:01:45.600 --> 0:01:48.360 The bitcoin on the flip side versus the US dollar 0:01:48.400 --> 0:01:50.160 is down one point seven percent. We're at sixty two 0:01:50.200 --> 0:01:52.440 thousand dollars, so there's still some risk aversion in this 0:01:52.480 --> 0:01:54.360 market ed when it comes to certain risk assets. 0:01:54.360 --> 0:01:56.600 Well, looking in on the micro I'm. 0:01:56.480 --> 0:01:59.200 Continuing to look at Tesla. This is a two day chart, 0:01:59.440 --> 0:02:02.680 the stockdown and another four percent. We broke the news 0:02:02.760 --> 0:02:05.279 yesterday that the job cuts at Tesla will be nearer 0:02:05.320 --> 0:02:09.799 to twenty percent. Elon Musk's memo said more than ten percent. 0:02:09.840 --> 0:02:12.360 We also broke the story that Drew Baglino, an eighteen 0:02:12.440 --> 0:02:15.840 year veteran and one of four named executives, had resigned. 0:02:16.120 --> 0:02:19.360 He then confirmed it on social media. The milestone is 0:02:19.360 --> 0:02:22.480 that Tesla's now below five hundred billion dollars of market cap. 0:02:22.520 --> 0:02:24.560 There's a lot of questions we're going to ask some 0:02:24.600 --> 0:02:27.760 of them throughout this week, throughout this quarter about what 0:02:27.840 --> 0:02:30.760 comes next for the ev name. Also looking at Microsoft 0:02:30.919 --> 0:02:33.200 up half a percentage point, had a slow start to 0:02:33.240 --> 0:02:36.560 the session. The headline on news is the one point 0:02:36.560 --> 0:02:38.919 five billion dollar investment in G forty two. 0:02:39.440 --> 0:02:41.399 There's a backstory which. 0:02:41.240 --> 0:02:43.160 Is, you know, I've been looking into for a few months. 0:02:43.200 --> 0:02:46.560 G forty two really likes what Sam Outman and OpenAI 0:02:46.600 --> 0:02:48.120 are doing. I think they want a piece of that. 0:02:48.440 --> 0:02:50.720 They now have a relationship with Microsoft. I wonder if 0:02:50.720 --> 0:02:53.560 that helps. And the backstory is a political one as well, 0:02:53.560 --> 0:02:56.680 that G forty two is now safe for a US 0:02:56.800 --> 0:02:59.840 company to invest in. It's very complicated, but it's an 0:03:00.080 --> 0:03:00.720 we're going to hear. 0:03:00.639 --> 0:03:03.400 More and more about, certainly, and let's get straight to it. 0:03:03.560 --> 0:03:06.200 Microsoft and the deal Blue Magatinea Bass you come of 0:03:06.240 --> 0:03:09.480 this of course with the Microsoft expertise covering all things 0:03:09.480 --> 0:03:11.880 of that business. But just take a step back, I mean, 0:03:11.919 --> 0:03:15.160 what had to happen first? What led to the divestment 0:03:15.200 --> 0:03:17.760 of China to move away from China? 0:03:18.120 --> 0:03:21.440 Sure, so, what a bunch of Bloomberg reporters in Doting 0:03:21.520 --> 0:03:23.720 and some of my other colleagues has been tracking for 0:03:23.760 --> 0:03:26.240 a while is that there have been is behind the 0:03:26.320 --> 0:03:30.920 scenes secret talks between the US government and G forty two, 0:03:31.120 --> 0:03:34.080 And what we reported last night is that that resulted 0:03:34.120 --> 0:03:37.880 in kind of a secret pack that was reached in 0:03:37.920 --> 0:03:40.360 which G forty two agreed to divest from China. 0:03:40.520 --> 0:03:40.800 Remember. 0:03:40.960 --> 0:03:43.560 G forty two was under a lot of criticism from 0:03:44.040 --> 0:03:46.800 US government from some members of Congress where its close 0:03:46.920 --> 0:03:51.320 ties to some Chinese companies, including Parkway, and they were 0:03:51.400 --> 0:03:53.640 under threat that they might not be able to continue 0:03:53.640 --> 0:03:55.680 to have access to the key in video chips that 0:03:55.720 --> 0:03:59.000 they need for their AI work. This kind of you know, 0:03:59.080 --> 0:04:02.680 secret pack result of it and used the way to 0:04:02.800 --> 0:04:03.760 this Microsoft deal. 0:04:05.040 --> 0:04:07.280 Did I think it's worth explaining to our audience what 0:04:07.400 --> 0:04:12.960 G forty two is. It's essentially an investment firm. But 0:04:13.160 --> 0:04:15.680 in all the conversations I have G forty two comes 0:04:15.760 --> 0:04:19.080 up a lot in the context of the Sam Outman 0:04:19.160 --> 0:04:22.800 chip initiative. We've reported that, you know, Sam Outman has 0:04:22.839 --> 0:04:24.920 met with G forty two, that G forty two wants 0:04:24.920 --> 0:04:27.000 to give him lots of money, But I don't think 0:04:27.040 --> 0:04:29.279 we've ever stopped and said, what's G forty two. 0:04:30.680 --> 0:04:34.560 Sure, it's essentially, you know, the biggest AI company in 0:04:34.600 --> 0:04:38.640 that region, in the UAE and large parts of that. 0:04:39.000 --> 0:04:39.760 Part of the world. 0:04:40.279 --> 0:04:42.640 It's a wholding company that's focused on AI, but it 0:04:42.680 --> 0:04:45.159 has its hands in a lot of different parts of AI. 0:04:45.560 --> 0:04:49.920 There's significant healthcare initiatives than talking on in artificial intelligence. 0:04:50.279 --> 0:04:53.279 For Microsoft, this is a multi stage deal and they 0:04:53.320 --> 0:04:55.560 want to take advantage of several parts of what G 0:04:55.680 --> 0:05:00.240 forty two offers them, including Microsoft President Brent Smith told 0:05:00.320 --> 0:05:03.080 us yesterday. In the later stage of the deal, they're 0:05:03.120 --> 0:05:06.320 hoping to put Microsoft services in G forty Tuesday data 0:05:06.360 --> 0:05:09.400 centers and use that as a way to access markets 0:05:09.440 --> 0:05:13.080 in Central Asia and Africa where Microsoft doesn't really have 0:05:13.120 --> 0:05:15.160 a presence and doesn't have its own data center. So 0:05:15.160 --> 0:05:18.240 that's another role the G forty two plays, sort of, 0:05:18.440 --> 0:05:21.880 you know, easing the speed of cloud and AI into 0:05:21.880 --> 0:05:24.839 some of those regions where US companies don't really have access. 0:05:25.279 --> 0:05:28.560 That's part of the reason why the Biden administration wanted 0:05:28.600 --> 0:05:32.200 to make sure that it removed gboty two from the 0:05:32.279 --> 0:05:36.000 Chinese sphere influence and you know, got closer to the 0:05:36.160 --> 0:05:38.920 US techology companies in the US technology industry. 0:05:40.080 --> 0:05:42.640 Bloomberg's Dina Bass one of the bylines on what is 0:05:42.680 --> 0:05:44.960 one of the most read stories and important pieces of 0:05:44.960 --> 0:05:47.280 reporting on Bloomberg this Tuesday. 0:05:47.480 --> 0:05:49.680 We've had the reporting and the details. Let's get some. 0:05:49.560 --> 0:05:53.040 More analysis and reaction with Dan Ives of Webbersion. Dan, 0:05:53.240 --> 0:05:56.280 you know, you kind of cover this from Microsoft's perspective, 0:05:56.880 --> 0:05:59.320 but you've written a few notes about the bigger picture 0:05:59.320 --> 0:06:01.440 as well with what happening with open AI and AI 0:06:01.480 --> 0:06:04.440 infrastructure build out. Just give us your kind of scorecard 0:06:04.920 --> 0:06:07.080 on this Redmond UAE tie up. 0:06:08.160 --> 0:06:10.800 Oh, I mean, this is a massive strategic bet. 0:06:11.360 --> 0:06:13.600 It's another flex the muscle. It's for redmen and the 0:06:13.760 --> 0:06:16.680 Dalla because really for G forty two, they had a 0:06:16.760 --> 0:06:20.800 choice China or US and Redmen and you're gonna take 0:06:20.880 --> 0:06:23.600 Microsoft every day of the week. 0:06:23.440 --> 0:06:24.760 Right now along with Nvideo. 0:06:24.920 --> 0:06:28.559 And for Microsoft, it's just another doubling it down. 0:06:29.200 --> 0:06:32.520 They're playing chess. Others are playing checkers. 0:06:34.200 --> 0:06:38.839 Then Microsoft is forming a lot of relationships with a 0:06:38.880 --> 0:06:42.360 lot of different people. Are they just making sure they're 0:06:42.400 --> 0:06:45.599 covered basically well look ed. 0:06:45.920 --> 0:06:48.680 They know their way ahead. So what they're doing is 0:06:48.720 --> 0:06:49.400 they're putting the. 0:06:49.360 --> 0:06:53.760 Guardrails up really around the world Joinny blind Spot Middle 0:06:53.800 --> 0:06:54.560 East being. 0:06:54.360 --> 0:06:55.160 One of them. 0:06:55.440 --> 0:06:58.200 They're gonna bet on the big Horus right here, and 0:06:58.640 --> 0:07:02.760 they ultimately even had to invest the Chinese piece. Also 0:07:02.839 --> 0:07:05.839 making sure that within the Beltway to or two area 0:07:05.960 --> 0:07:09.160 could there's no issues there. So from Microsoft, this is 0:07:09.160 --> 0:07:13.600 an example they're miles ahead. They're just further and further 0:07:13.840 --> 0:07:17.880 gaining share from an AI perspective, given this AI revolution 0:07:18.200 --> 0:07:23.600 where them all mean the golden child of AI resides Dan. 0:07:23.680 --> 0:07:26.920 What's interesting is in this case US government played a 0:07:27.000 --> 0:07:29.400 role in other areas. I think of just what happened 0:07:29.440 --> 0:07:33.240 last week with the UK CMA worrying from a regulatory 0:07:33.240 --> 0:07:37.760 perspective about certain key players having a web of relationships 0:07:37.920 --> 0:07:39.960 and then crossing over too much in the world of AI. 0:07:40.480 --> 0:07:43.160 Will this be regulated from a competition perspective? 0:07:43.800 --> 0:07:46.040 Well, I think what Brad Smith knows it as well 0:07:46.080 --> 0:07:49.600 as anyone. He's going to proactively in Microsoft make sure 0:07:50.400 --> 0:07:53.360 US and Beltware are good with this because they don't 0:07:53.400 --> 0:07:56.040 want all of a sudden a year eighteen months from 0:07:56.040 --> 0:07:58.680 now this becomes a bigger issue. And they checked all 0:07:58.680 --> 0:08:02.480 those boxes. The Chinese divestiture I think was important from 0:08:02.480 --> 0:08:05.120 a G forty two perspective, and now it's a green 0:08:05.200 --> 0:08:08.640 light going ahead at the same time where Amazon and 0:08:08.720 --> 0:08:11.640 Google still trying to play catch up, and this is 0:08:11.800 --> 0:08:16.200 Nedella just continuing to make aggressive bets and we'll see 0:08:16.200 --> 0:08:17.360 it again earnings. 0:08:17.000 --> 0:08:19.800 Where they continue to be the lead from an AI perspective. 0:08:20.760 --> 0:08:23.960 Phenomenal game of chess, as we sort of referenced, And 0:08:24.000 --> 0:08:27.760 what is on many players' minds right now is where 0:08:27.800 --> 0:08:30.880 are the bottlenecks? Time and time again from Sam Altman 0:08:30.960 --> 0:08:33.360 and many that it's to do with energy and it's 0:08:33.360 --> 0:08:36.320 to do with access to AI infrastructure. Is that what 0:08:36.400 --> 0:08:38.280 you hear from the leaders of these companies and how 0:08:38.360 --> 0:08:40.319 much more investment and we likely to see to try 0:08:40.400 --> 0:08:42.679 to see a solution globally for that. 0:08:43.520 --> 0:08:45.400 Yeah, And I think ed now that when you was 0:08:45.400 --> 0:08:48.160 talking about on the chip side, there's a two parter 0:08:48.320 --> 0:08:50.680 here because I think this is ultimately going to lead 0:08:51.240 --> 0:08:53.920 from a chip perspective to more and more investment from 0:08:53.960 --> 0:08:56.880 Middle East towards some of the all men and chip 0:08:57.160 --> 0:08:59.959 ventures that's now going on within Open AI and Microsoft. 0:09:00.360 --> 0:09:04.240 Of course, energy continues to be the constraint, but use 0:09:04.320 --> 0:09:05.000 cases are. 0:09:04.840 --> 0:09:06.320 Exploding across the board. 0:09:06.440 --> 0:09:11.280 And now this fourth industrial revolutions here being led by 0:09:11.360 --> 0:09:14.360 the Dell and of course the godfather of AI, Jensen 0:09:14.440 --> 0:09:14.880 Na Vidio. 0:09:16.000 --> 0:09:18.160 I love having the perspective Dan Ives, who can make 0:09:18.200 --> 0:09:19.240 it a global conversation. 0:09:19.280 --> 0:09:20.640 We thank you for web Bush. 0:09:20.880 --> 0:09:23.240 Meanwhile, let's just go to another key player that many 0:09:23.240 --> 0:09:25.520 in human eye on Apple, It's pledged to buy more 0:09:25.559 --> 0:09:30.080 components and accessories for its devices from Vietnam suppliers. Now 0:09:30.120 --> 0:09:32.720 the move is a big boost for the Southeast Asian country, 0:09:32.960 --> 0:09:36.200 says it emerges as a global electronics hub. Apple is 0:09:36.240 --> 0:09:38.880 exploring ways to shift production, of course of its GAVET 0:09:38.880 --> 0:09:42.240 gadgets away from China. That's to minimize those geopolitical risks. 0:09:42.240 --> 0:09:45.360 And the iphonemaker is exploring India and in Vietnam. 0:09:45.240 --> 0:09:47.360 Which has seen about a fourfold. 0:09:46.880 --> 0:09:51.240 Increase in companies assembling Apple products over the past decade. Meanwhile, 0:09:51.240 --> 0:09:54.400 coming up, well, let's talk about global regulation for a moment. 0:09:54.400 --> 0:09:57.400 We're joining the European Commission of Financial Services to discuss 0:09:57.440 --> 0:09:59.560 all things digital finance and regulation. 0:09:59.640 --> 0:09:59.959 There at. 0:10:01.440 --> 0:10:03.440 I'm taking a quick look at shares of the Swedish 0:10:03.440 --> 0:10:07.480 company Ericsson. This is the Swedish SES two percent higher 0:10:07.880 --> 0:10:10.480 as it stands. The USA dr is actually a little 0:10:10.480 --> 0:10:15.000 bit higher even still than that beat on earnings, and 0:10:15.040 --> 0:10:17.800 it's really interesting there's a company going through restructuring at 0:10:17.800 --> 0:10:20.920 a time where the mobile phone or cell carriers are 0:10:20.960 --> 0:10:25.640 just not spending on five G network infrastructure, but the 0:10:25.679 --> 0:10:28.920 market likes what it sees. Stock up two percent. This 0:10:28.960 --> 0:10:30.000 is Bloomberg Technology. 0:10:40.600 --> 0:10:40.880 Okay. 0:10:40.880 --> 0:10:43.600 The European Unions back in Silicon Valley, and this time 0:10:43.640 --> 0:10:47.040 the focus is payments, crypto and the impact of artificial 0:10:47.040 --> 0:10:51.479 intelligence on banks. European Commissioner for Financial Services Marade McGinnis 0:10:51.679 --> 0:10:54.680 has met with coinbase and Plaid, and has meetings lined up. 0:10:54.760 --> 0:10:56.280 With Apple and Stripe. 0:10:56.320 --> 0:10:59.040 I'm delighted to say the Commissioner joins me now on set. 0:10:59.080 --> 0:10:59.440 Welcome. 0:10:59.559 --> 0:11:01.480 Yeah, to be here in person. 0:11:01.720 --> 0:11:03.600 It's been a while since I was this side of 0:11:03.720 --> 0:11:05.760 the countries. 0:11:05.320 --> 0:11:05.760 So it's good. 0:11:05.960 --> 0:11:09.600 It's interesting that the ongoing relationship between the Commission and 0:11:10.640 --> 0:11:12.600 Silicon Valley based companies. You forget there are more than 0:11:12.600 --> 0:11:15.400 four hundred million people in Europe who have access to 0:11:15.440 --> 0:11:18.880 those companies and their products. Just summarize the purpose of 0:11:18.920 --> 0:11:20.520 your visit and your objectives. 0:11:20.520 --> 0:11:22.640 Well, it's always good to meet colleagues and you can 0:11:22.679 --> 0:11:25.200 talk to them by phone, but being here in person matters. 0:11:25.360 --> 0:11:28.120 We're at a critical stage, so this commission is coming 0:11:28.160 --> 0:11:30.520 towards the end of its mandate. There's been an awful 0:11:30.520 --> 0:11:34.839 lot of change around finance, digitalization, we have artificial intelligence, 0:11:35.080 --> 0:11:37.600 and really we're here to exchange views and to listen 0:11:37.600 --> 0:11:40.000 to what's happening on the ground here because it's a 0:11:40.040 --> 0:11:44.080 fast moving area. Even since my taking up this role, 0:11:44.160 --> 0:11:48.760 we've seen a huge evolution in banking. COVID accelerated the 0:11:48.880 --> 0:11:52.000 use of digital payments. We want payments to be instant. 0:11:52.080 --> 0:11:55.040 We've got legislation around that. So basically, what we're trying 0:11:55.080 --> 0:11:59.640 to do is harness the benefits of all of these technologies. 0:11:59.160 --> 0:12:00.840 But all the way I look at the risks that 0:12:01.000 --> 0:12:01.400 might be. 0:12:01.400 --> 0:12:04.680 Involved in them, and our idea is not to stifle innovation, 0:12:04.840 --> 0:12:07.520 and this is a place where innovation flourishes, so it's 0:12:07.559 --> 0:12:08.480 good just to exchange. 0:12:08.720 --> 0:12:10.160 We have a lot to discuss I'd like to very 0:12:10.200 --> 0:12:13.080 quickly just tick off crypto coinbased from the show with 0:12:13.120 --> 0:12:15.280 me last week, and they had a number of grievances, 0:12:15.880 --> 0:12:20.920 particularly about legislating for regulation. 0:12:20.559 --> 0:12:21.800 Instead of going through courts. 0:12:22.040 --> 0:12:24.360 What were the grievances they brought up to you in 0:12:24.400 --> 0:12:25.400 the context of Europe. 0:12:26.080 --> 0:12:28.760 The grievance where it didn't arise because actually they feel 0:12:28.800 --> 0:12:32.400 comfortable that Europe has provided certainty with our markets and 0:12:32.440 --> 0:12:35.720 crypto assets legislation, and while there might be minor issues 0:12:35.760 --> 0:12:38.400 within that, at least they know how they will be 0:12:38.440 --> 0:12:40.839 regulated and licensed at the European level. 0:12:41.160 --> 0:12:42.640 I think here it's different. 0:12:43.040 --> 0:12:46.400 So we were able to talk about the benefits of certainty. 0:12:46.800 --> 0:12:49.800 Very often Europe can be accused of being a rules 0:12:49.800 --> 0:12:52.200 based which I think is actually a good accusation because 0:12:52.280 --> 0:12:56.840 rules matter, but sometimes overregulating. I was very interested to 0:12:56.920 --> 0:13:00.360 hear how certainty is important for a company like coin base, 0:13:00.720 --> 0:13:04.480 and I was also interested that maybe a few years 0:13:04.520 --> 0:13:07.800 ago this was an area of concern, but actually when 0:13:07.840 --> 0:13:10.360 you listen to that company and its vision for what 0:13:10.520 --> 0:13:13.839 could come next in terms of innovation and how they 0:13:13.880 --> 0:13:17.440 believe regulation is important. I was very encouraged by that. 0:13:17.559 --> 0:13:19.960 So we didn't have so much of the grievances. I mean, 0:13:20.000 --> 0:13:22.000 there are issues that they will talk to us about, 0:13:22.240 --> 0:13:25.160 and we're very open to talking with and to those 0:13:25.200 --> 0:13:27.679 who are using our legislation and who need clarification. 0:13:27.760 --> 0:13:29.800 Commissioner again, it's can I push back a little bit 0:13:29.880 --> 0:13:33.320 because I'm reading a report from Tether, for example, now 0:13:33.400 --> 0:13:36.520 nowhere near as much oversight as the previous business we're 0:13:36.559 --> 0:13:39.640 just talking about, but key player within stable coins, the 0:13:39.720 --> 0:13:42.280 player and stable coins, many would say, and they've gone 0:13:42.280 --> 0:13:45.000 on the record saying the message being sent is that 0:13:45.040 --> 0:13:48.240 Europe does not want crypto regulation has had that is 0:13:48.320 --> 0:13:53.640 largely limiting access, especially for retail investors. Brussels effect for 0:13:53.760 --> 0:13:55.560 many feels like a cooling effect. 0:13:56.840 --> 0:13:59.120 Well, look, everyone has a different opinion on this, and 0:13:59.160 --> 0:14:01.480 I think we had three options when it came to crypto, 0:14:01.880 --> 0:14:05.160 ignore it and let things evolve, ban it because. 0:14:04.880 --> 0:14:05.880 We couldn't control it. 0:14:06.080 --> 0:14:09.079 Or and this is the approach we have taken regulated 0:14:09.440 --> 0:14:11.920 so that those that are in the industry have certainty 0:14:12.120 --> 0:14:15.560 about when they're dealing with clients within the European Union, 0:14:15.840 --> 0:14:17.840 and I think we took the right course. Now, it's 0:14:17.880 --> 0:14:20.880 a fast moving area and equally many who are in 0:14:20.920 --> 0:14:23.960 that space originally came to it because they didn't want 0:14:24.040 --> 0:14:26.600 to be in the regulated zone, if you like. But 0:14:26.800 --> 0:14:29.840 I do think there's more maturity now that those who 0:14:29.880 --> 0:14:33.160 want to have a lifetime in this business, which will 0:14:33.240 --> 0:14:36.720 evolve over that time, want certainty in terms of their 0:14:36.800 --> 0:14:40.680 dealing in the European Union, and we have provided that certainty. 0:14:40.960 --> 0:14:42.600 And I think that's all to the good of the 0:14:42.640 --> 0:14:46.280 industry itself. It's in one sense AI has overtaken some 0:14:46.360 --> 0:14:49.880 of the conversations around crypto because crypto has been around 0:14:50.000 --> 0:14:50.960 for some time. 0:14:51.480 --> 0:14:54.280 It looks like it will prevail. There are different views. 0:14:54.000 --> 0:14:56.760 In Europe about whether crypto is an asset or not, 0:14:57.320 --> 0:14:59.640 and we have all of these conversations. What we do 0:14:59.720 --> 0:15:02.080 in the permission is bear in mind, you know that 0:15:02.200 --> 0:15:06.840 the greater good, so is the balance of regulation better 0:15:07.160 --> 0:15:11.720 than allowing things evolved without any guardrails. 0:15:12.360 --> 0:15:15.800 Commissioner apologies to drump in, but the AI guardrails, for example, 0:15:15.880 --> 0:15:18.760 the AI Act. How much you think AI is a 0:15:18.800 --> 0:15:22.400 concern in terms of well financial stability right now? 0:15:23.440 --> 0:15:25.920 Well, I mean that's a very big question. I think 0:15:26.080 --> 0:15:29.440 the issue of AI. Yeah, but it's such a big 0:15:29.560 --> 0:15:31.640 question that when you listen to some of the scary 0:15:31.680 --> 0:15:34.920 stories around AI, you would really want to stop it immediately, 0:15:34.960 --> 0:15:37.720 but it is not something that you can actually contain. 0:15:38.320 --> 0:15:41.160 What we can do is try and look in a 0:15:41.200 --> 0:15:42.200 measured way of what. 0:15:42.440 --> 0:15:44.720 Are the risks, because not only AI. 0:15:45.160 --> 0:15:47.920 Is higher risk, In fact, some of it is extremely useful. 0:15:48.160 --> 0:15:51.040 And again our approach, and it sounds dull, but it's 0:15:51.080 --> 0:15:53.440 important to say it. It's about balance. 0:15:53.920 --> 0:15:57.880 Allow the industry evolve, but allow those who are you know, 0:15:58.520 --> 0:16:00.800 if you're like in charge of watching these things, like 0:16:00.880 --> 0:16:03.840 the Commission and our Parliament, to have us say in 0:16:03.920 --> 0:16:06.680 how it evolves. And we wanted to do good, so 0:16:06.720 --> 0:16:10.040 we again look at the risks involved rather than allow 0:16:10.440 --> 0:16:15.880 an unfettered evolution of artificial intelligence, which is already being 0:16:16.000 --> 0:16:18.760 used in the financial system in any event, I gather 0:16:18.840 --> 0:16:20.480 I have one who who talks to me on my 0:16:20.800 --> 0:16:23.800 banking app. We get on sometimes not all the time, 0:16:24.160 --> 0:16:26.320 and I think behind all of this is a desire 0:16:26.320 --> 0:16:31.359 to harness technology but not remove the human dimension around technology, 0:16:31.360 --> 0:16:34.280 and there's a risk that that could happen. So we've 0:16:34.320 --> 0:16:36.840 been mindful of all of these things and we have 0:16:36.920 --> 0:16:40.840 been careful to categorize where the risks are. Conscious also 0:16:41.040 --> 0:16:44.520 that this will evolve. It is evolving before our very eyes. 0:16:44.920 --> 0:16:47.640 It is commissioner, and that's why you've got plenty of conversations. 0:16:47.720 --> 0:16:50.360 Still we had, we wish we had longer with you, right, 0:16:50.440 --> 0:16:51.920 We get as wonderful to have you on the show. 0:16:51.960 --> 0:16:57.560 Europeing Commissioner for Financial Services. 0:17:02.920 --> 0:17:06.080 Revos is a Silicon Valley AI chip developer without a 0:17:06.160 --> 0:17:09.080 product on offer yet, but it's raised more than two 0:17:09.160 --> 0:17:12.520 hundred and fifty million dollars in an oversubscribed funding round, 0:17:12.760 --> 0:17:15.800 with Matrix Capital Management, the largest investor in the round, 0:17:16.040 --> 0:17:18.439 joining the board. Delighted to bring in Rivos CEO Punic 0:17:18.520 --> 0:17:22.280 Kumar for more. This is an AI chip based on 0:17:22.359 --> 0:17:25.760 Risk five architecture. I hear a lot about that at 0:17:25.760 --> 0:17:27.520 the moment as an alternative to a video. 0:17:27.560 --> 0:17:29.639 But let's go back to the idea that it is 0:17:29.680 --> 0:17:30.320 in design. 0:17:30.600 --> 0:17:32.840 You're in the R and D phase, that's correct. The 0:17:32.880 --> 0:17:35.080 two hundred and fifty million, where does it get you? 0:17:35.560 --> 0:17:37.760 Okay? So first of all, thank you for having me 0:17:37.800 --> 0:17:40.760 on the show. An honor to be here. What we 0:17:40.840 --> 0:17:43.840 plan to deal with this fundraise that we are announcing 0:17:43.880 --> 0:17:49.560 today is to really primarily support our increasing customers. We 0:17:49.680 --> 0:17:51.159 have huge demand coming at. 0:17:51.080 --> 0:17:53.119 Us increased customers if you haven't got anything to give 0:17:53.200 --> 0:17:53.639 him yet. 0:17:53.800 --> 0:17:56.040 So we've been speaking with a lot of potential customers 0:17:56.160 --> 0:17:59.760 already and they're very intrigued by our design. What we 0:17:59.840 --> 0:18:02.359 have to offer and what we're going to do today 0:18:03.000 --> 0:18:06.360 is use this money that we eraised to expand our 0:18:06.440 --> 0:18:12.160 operations globally, increase our hiring, increase our engineering efforts, get 0:18:12.200 --> 0:18:15.560 to production of our parts, and really get to trial. 0:18:15.960 --> 0:18:20.040 I hear increasingly there is a market for Risk five 0:18:20.200 --> 0:18:24.280 based AI accelerator or AI chip. It's a point of 0:18:24.320 --> 0:18:32.119 differentiation from Nvidia and prior for cupcoming generations. But it 0:18:32.119 --> 0:18:34.840 doesn't seem like that market's here in America. No one's 0:18:34.840 --> 0:18:37.359 taking it seriously, that's right, is it in China? 0:18:38.359 --> 0:18:41.080 Actually that's not true. It is here too. If you 0:18:41.600 --> 0:18:44.040 in the last few days, you saw an announcement, for example, 0:18:44.119 --> 0:18:47.000 from one of the big AI drivers that they are 0:18:47.080 --> 0:18:51.800 using risk five in their in their chips already. So 0:18:51.840 --> 0:18:54.840 we definitely see a place for Risk five in the 0:18:54.880 --> 0:18:58.080 air market, and there's several companies in this market space already. 0:18:58.359 --> 0:19:00.400 BENI for those who aren't as well versus and Risk 0:19:00.480 --> 0:19:02.960 five versus our architecture break. 0:19:02.720 --> 0:19:04.439 Down, what alternative offers. 0:19:04.600 --> 0:19:08.119 Is this about cost? Is this about ability efficiency? 0:19:09.600 --> 0:19:13.479 It's actually a combination of many factors. Cost is just 0:19:13.760 --> 0:19:17.040 saving a license fee, for example, rather than paying somebody else. 0:19:17.440 --> 0:19:20.200 But really the biggest thing I think is drives a 0:19:20.240 --> 0:19:24.359 lot of innovation because it's a brand new architecture. It's open, 0:19:24.840 --> 0:19:28.080 so that allows anybody to do research with that architecture. 0:19:28.600 --> 0:19:30.600 And this is where we kind of see innovation happening 0:19:30.640 --> 0:19:32.960 in the next five to ten years, and it'll eventually, 0:19:33.119 --> 0:19:37.159 we think, will displace many of the other players in 0:19:37.200 --> 0:19:42.080 the market, the existing incumbents. This really is the Linux moment. 0:19:42.560 --> 0:19:45.920 We think risk Fribe brings a Linux moment to instruction 0:19:46.040 --> 0:19:49.520 set architectures for CPU designs Perny. 0:19:49.640 --> 0:19:53.360 Therefore, there is this handringing going on about the access 0:19:53.359 --> 0:19:55.720 to AI infrastructure, a need for energy. We've talked a 0:19:55.760 --> 0:19:57.919 lot about just the teaming up a Microsoft and G 0:19:58.080 --> 0:20:03.000 forty two, the obvious global conversation going on around access 0:20:03.040 --> 0:20:03.520 to chips. 0:20:03.800 --> 0:20:05.120 Who would be your customer? 0:20:05.560 --> 0:20:07.840 Are you going after in video's customers or are you 0:20:07.880 --> 0:20:10.280 going after ones that can't access in video? 0:20:11.520 --> 0:20:14.440 Okay, so I think first of all, we are going 0:20:14.520 --> 0:20:18.600 after any customer that is really using a lot of data. 0:20:18.680 --> 0:20:21.120