IT industry experts and analysts are still trying to piece together Nvidia’s surprise plan to pay $12.9 billion for open-source AI company Hugging Face.
Nvidia dominates AI with its GPUs, and the company generates billions of dollars in revenue through a proprietary approach to the fast-moving technology. Hugging Face, on the other hand, hosts open models and has been a neutral player between chip vendors and model labs.
“This is about Nvidia having more say in how the stack gets built,” said Stephanie Walter, analyst at Hyperframe Research.
Hugging Face is wildly popular with developers, and Nvidia is buying early influence with that crowd. “You have a better chance of being part of the production environment later,” Walter said, adding that she wasn’t sure how Nvidia reached a nearly $13 billion price tag for the acquisition.
“Hugging Face has near-uncontested market primacy over where developers go for open-weight model releases. Now Nvidia owns that,” said Mark Petty, senior director analyst at Gartner.
