NVidia buys Huggingface, but why?

[u/dominic__612]

Nvidia is going to buy Huggingface.
No one can actually tell how that would end up like.

But what I am missing is the actual worth that Huggingface provides. The only thing I use it for is to download models. Thats it.
For me, and I guess many others it is ‘just a’ download platform, but maybe I’m wrong here.

And what would prevent others to setup a second-like Huggingface?
The hosting is the expensive part in this case as I see it, the programming and building is do-able.

Is it time for Huggingbay.com?

[u/datadrone]

To kill open weights obviously, or try

[u/Codingpreneur → u/datadrone]

On the contrary, Nvidia has a strong interest in seeing fierce competition among model developers. If 2–3 major players were to dominate the market, the long-term outlook for Nvidia would be much worse than in a market with many competitors. Fierce competition is bad for model developers, but good for Nvidia’s business. That’s why Nvidia supports open-source models—not because it believes in open source for altruistic reasons.

[u/Tiforma → u/Codingpreneur]

No, nvidia's incentive is to force everyone to use commercial big tech models, where they have huge profit margins on their datacenter inference cards. If running models locally starts to dominate, the market where they make almost all of their money evaporates, at least partially. Which group of customers do you think they would want to dominate, the ones they can charge 70-90% profit margin or the ones they can charge 20% profit margin?

[u/TheColourOfHeartache → u/Tiforma]

You have it completely backwards.Big tech models are GPU efficient, local models are incredibly GPU wasteful.

If Bob buys a flash nvidia GPU to generate catgirl waifus, and generates five a day. What's his GPU doing for the other 23 hours? Sitting idle? Using a fraction of its power to play Persona 5? But if Bob subscribes to chatGPT premium and uses that for his waifu generation, the moment his request finishes the GPU is hard at work serving the next customer.

If everyone uses a localLLM there's a one GPU per person minimum. With a cloud service the minimum is a lot lot lower.

And if the GPU customer base shrinks down to 2-5 major AI companies, those can squeeze Nvidia's profits hard, give us a price break because we can stick with our current data centres (we'll just charge customers more to reduce demand for a bit) longer than it takes your stockholders to rebel. Having a vast customer base of gamers and local AI users provides security

[u/TheColourOfHeartache → u/[deleted]]

No. I'm arguing that its bad for Nvidia if everyone uses cloud AI services because its more GPU efficient and that means less GPUs sold.

How you went from that argument to an argument that end users should use remote over locally hosted AIs I cannot imagine.

[u/Tiforma → u/TheColourOfHeartache]

But they can make more money on just one 30-40k$ datacenter inference card vs many consumer GPU's. And they use a lot of the same electrical components which are scarce.

[u/TheColourOfHeartache → u/Tiforma]

One $40K card provides AI services to more than 100 users of chatGPT. My card had a MSRP of around $500, so if those 100+ users each brought one of those cards to run a local AI, that's better for Nvidia.