Alibaba Takes On Nvidia as the Global AI Race Heats Up

0:00The most effective people at work aren't working harder than everyone else. They're working smarter, inside better systems. Superhuman Go, from the makers of Grammarly, is the AI assistant that works inside every tool you already use, always ready, already aware of what you're working on. It's a teammate whose only job is to help you be better at yours. With Go working with you, you can show off what you do best. See what Superhuman Go can do at superhuman.com. Some people treat ChatGPT like some kind of smart search engine, and some use it to get work done. ChatGPT Work is a new way of working in ChatGPT that can take action across your apps and files, stay with a project for hours if needed, and turn a goal into finished work.

0:46It's designed to help you move from a chaotic starting point to a reviewable first version. So all the source materials, briefs, and scattered information that you have to grind through to turn into something useful can just become something useful. Put ChatGPT to work on your most ambitious ideas and projects. Get started at ChatGPT.com by selecting Work Mode, available on Plus and Pro plans. This is Robert Smith from Business History. If you're listening to this, there's a good chance you're a small business owner. And like every small business owner, you started with a dream to do what you love and watch it grow.

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1:49Ed Ludlow:This is Bloomberg Tech and we've just been listening to US President Donald Trump, his address of the United Nations General Assembly, where the latter part of that speech focused on artificial intelligence, highly relevant to this show, Bloomberg Tech. He said that the US rejects attempts of a global scheme to control AI and that in the future all US documents will use, quote, superintelligence. He will encourage superintelligence, the president said, not rein it in. In terms of what markets are doing, looking at equities, looking at the treasury market and also the dollar, not so many moves in response to the content of the speech.

2:25Ed Ludlow:We see equities largely flat on the whole, some outperformance in technology, U.S. 10-year yield at 4.95%, Bloomberg dollar spot index, not really moving on the content of what the president had to say. Outside of artificial intelligence, a focus on Iran, the events in Venezuela, commentary on Cuba, and a whole lot more. Let's get out to Bloomberg's Tyler Kendall, who is at the UN Rose Garden, to summarize what the president had to say. Tyler. Hey, Ed, well, at this point, President Trump really used this speech to defend his foreign policy objectives, saying that he has tackled, quote, intractable challenges.

3:05early on, as he mentioned, he highlighted Iran, threatening that we can either see escalation or diplomacy in terms of what comes next. He threatened that he has a decision to soon make. On one hand, he can make a deal with Iran to allow the country to rebuild, or on the other, he will, quote, annihilate the Islamic Republic. Domestic and foreign policy really dovetailing there as he claims that Iran is waiting until after the midterm elections to strike a deal. For his part, President Trump says that he is urging Iran to make a deal. As We know there has been growing frustration, not just from the Trump administration, but also from the regional Gulf allies that President Trump is set to meet with later this afternoon.

3:42The president did thank the U.N. Security Council in passing a resolution to condemn Iran when it comes to attacks on commercial shipping. He also claimed that the U.S. is quickly adding to its stockpiles, even as on Friday, Bloomberg News reported that the U.S. is now alerting European allies that they could see delays of up to five years in terms of getting their weapons deliveries. as the U.S. tries to rebuild and revitalize the domestic industrial base. He then pivoted to talk about the Western Hemisphere. We can go through some of the headlines there. The interim president of Venezuela, Adelcy Rodriguez, was in that room.

4:15He also claimed that Cuba will soon fail and said that Secretary of State Marco Rubio is currently negotiating with the country. On Russia, he said that he is going to potentially use that new tariff authority to impose secondary tariffs on Russia. if the Kremlin does not come to the negotiating table. That was some of the foreign policy headlines. But really at the end there, Ed, as you know best, we got that update from President Trump touting artificial intelligence, saying that he's now going to call it super intelligence and that whoever dominates the technology will be the winner, appearing to set the stage for that high-stakes meeting between him and Chinese President Xi Jinping later this week.

4:56Ed Ludlow:I think there's Tyler Kendall at the UN Rose Garden. Thank you very much. and it's on AI that we will pick up and carry on this episode of Bloomberg Tech. President Trump talking about artificial intelligence just moments ago at UNGA and the ongoing AI race with China. Let's bring in Nancy Tengler, CEO and CIO of Laffer Tengler Investments, to digest it all, which, you know, Nancy, I appreciate is no hard task. Look, the president speaks very positively about AI as a strength of America and as a competitive tool against China. Your reaction to his remarks? I mean, I do think they're important, Ed.

5:27Good to be with you. He has taken a position. I actually support that position because I don't think government has been effective at regulating crypto, for example, or even go back to Internet days. So I think self-regulation from the company, solutions around the problems allow us to continue to grow and continue to see disinflationary growth in the U.S. economy, not to mention potential defense applications, et cetera. So I thought it was a good comment for him to make. And superintelligence may, in fact, catch.

6:03Ed Ludlow:We're going to talk about superintelligence in just a second. In terms of the bigger picture markets, picture, you know, Bloomberg writes in its global rap that stocks and bonds wavered during that speech. I would say there was little movement in many asset classes. The main takeaway, though, being that there was no sort of knee-jerk reaction to the idea that the president is going to put America in a position where he wants them to lead in AI. he's not going to allow for a pullback. Yeah, I think that's right. And I think he I mean, he said it before, but now he said it on the global stage. So I think that's a comfort to investors who are thinking about this as, you know, a transitional economy, a technological revolution.

6:43He called it an industrial revolution, whatever you want to call it. This technology is much more powerful than the Internet that we had in the 90s, obviously, and also will change the way we live.

6:55Ed Ludlow:Nancy, this speech is a precursor to a meeting with Chinese President Xi Jinping. As a technology investor in equity markets, how much you braced for that moment and what comes out of it? I don't actually think much will come out of it. We'll get the platitudes, Ed, but I don't think we'll see China ever change their behavior. So the question becomes, you know, over time, will we be able to ship more NVIDIA chips? will that be allowed? I think that's the only thing I'm really paying attention to, but I don't expect China to self-regulate. Nancy, the story of the last 24 hours has been AI agents, Meta, highest level since October, 11 % jump, it continues today because Muse, its AI agent, is number one on the App Store free downloads for Apple.

7:44Ed Ludlow:You've been bearish on Meta in the past. Has anything changed for you? It has. You shamed me into buying it, It took me a while. We recently added it to the portfolio. And I think for a couple of reasons. First of all, it's trading as a value stock. We think the revenue growth will compound at 20%. So on a relative price to sales ratio basis, it's super attractive. And on a price earnings to growth basis, you need a few things to go right. But the advertising business is taking share. And it is. I mean, I've always said my knock has been it's just an advertising company. But I think Muse changes the calculus materially.

8:23And so we'll see. It is a way for them finally to monetize the CapEx spend. And I think that's very important. Then you got MetaOne, which I think is really interesting. And I'll say this, Ed. You know, SpaceX bought Cursor, as you well know. They paid$60 billion for a company that employed 20 people and was four years old. So when you think about the power of these technologies to allow you to leverage innovation and talent with few employees, I think that's one of the things that Meta is going to be contributing to with MetaOne and some of the other applications.

8:58Ed Ludlow:The sell side is saying this is not just the moment of the AI agent, the chat GBT moment, but it justifies Meta's spend as well. That's kind of their conclusion. Nancy Tengler, CEO and CIO of Lafetenga Investments. Thank you very much indeed. Now coming up, world leaders are gathering at the UN General Assembly and we'll be joined by Irish Foreign Minister Helen McKenty. That's next. This is Bloomberg Tech.

9:30Ed Ludlow:Our future will be shaped by how we address four great tests of power. The power over war and peace. the power that concentrates wealth and drives inequality, the power fueling climate chaos and war on nature, and the power unleashed by artificial intelligence. That was UN Secretary General Antonio Guterres earlier this morning showing that AI is taking center stage at the United Nations. Anthropic CEO Dario Amadei and OpenAI's Sam Altman are set to brief the Security Council Wednesday on the future of the technology. amid growing calls for global coordination on AI safety. It comes as President Trump prepares to meet China's Xi Jinping Thursday with AI expected to be a part of the conversation.

10:18Ed Ludlow:Bloomberg's Mike Shepard joins us now from Washington, D.C. The briefing of the leaders of the Frontier Labs to the Security Council. What do we know? Well, Ed, you know, this is not going to be a moment where we get a big reveal from either Dario Amadei or Sam Altman. And it's important to note that Hugging Face CEO Clem DeLong is scheduled to be speaking there, too. We're not expecting them to say anything dramatically new in terms of revelations about breaches or risks. We've heard so much from each of them over the past several weeks. What is interesting, though, is the context. They will be briefing representatives from some of the most powerful countries on Earth, including at the same time in the same room the leaders of the two nations that are responsible for all of the cutting-edge AI development these days, and that is the United States and China.

11:10And those two countries really are locked in competition to try to dominate this technology. And we have heard the contrast between President Donald Trump rejecting calls for global coordination and oversight and the UN Secretary General in his valedictory address to the world body today after 10 years in the job, 10 years where he has talked about artificial intelligence, warning that there, yes, needs to be some global oversight. Yes, there needs to be coordination among nations and that there is this risk that AI is helping to fuel a shift of power to private corporations and wealthy individuals away from governments and removing from people the agency over their own lives.

11:50Ed Ludlow:Sheb, let's revisit our conversation from yesterday. The big moment this week will be President Trump with China's Xi Jinping. You know, we said earlier in the program, AI is going to be on the table. Do we know anything about the parameters of that AI conversation? Well, you know, the representatives from the two countries did meet yesterday in New York for further discussions. Scott Besson and his counterpart talked some more. We did not get a great deal of additional visibility on what the two countries actually went through. And if they had agreed on anything, we did hear Sunday from Scott Besson saying that, look, we have set up the framework for an AI dialogue between the U.S.

12:31and China, where there could be discussions about risks and benefits of the technology. Not too many more details there, Ed. And also some sort of a notification system about risks. Again, it's unclear what we are going to get later in the week when the two sides emerge and actually present their deliverables? Will there be some sort of a formal setup that allows the two countries to really speak to each other in rational terms and in terms that could lead to some productive engagement, even as they are competing very bitterly over this technology? We just don't know. But we are reporting it out.

13:06We are trying to figure out also who will be there. We do know that there will be a number of U.S. executives, high profile names from Silicon Valley present. We don't know whether there will be a complimentary delegation of Chinese executives also set to show up. That will be an interesting thing for us to watch. And look, Ed, there is a lot at stake here. And yet at the same time, we are not expecting big advances. We heard Nancy Tengler say that her expectations for some breakthrough, some grand bargain on AI are very low. And that is our sense, too, from the reporting we have done.

13:40Ed Ludlow:There is basically an effort by private industry to move towards a global standard, to move towards rules regulation. Is it even possible right now, Mike, to summarize what this Trump administration's policy is on pacing the frontier of AI? Well, you know, the president himself really spelled it out pretty clearly in his speech. He wants to encourage the development of this technology, not rein it in. He sees existing U.S. laws as sufficient to handle any sort of risk. They have talked about using liability protections baked into the U.S. code as a way of reining in companies from outpacing the capabilities of their technology and putting users and even nation states at risk.

14:25Now, that does fly in the face of what we have been hearing from Dario Amadei, Sam Allman, and others in the industry who say, yes, we do need some sort of framework. We need to be able to vet these models more clearly. And yes, government does have a role. But the administration for now is not really interested, at least from the president's perspective, in having that kind of conversation. They want to hit the gas as much as possible. They have a lot at stake. AI is central to the administration's economic agenda right now, Ed. And you heard the president also when talking about existential risks, he regards them as a hoax.

15:01And he doesn't see the same need for Garb Reels that members of the industry and certainly people in Congress and in government here across the U.S. and around the world have identified as necessary.

15:14Ed Ludlow:Bloomberg's Mike Shepard with the roundup of everything happening with this administration AI this week. Thank you very much indeed. We have so much more coming up in the program after the break. This is Bloomberg Tech.

15:37Ed Ludlow:I just broke some news on the Bloomberg. GrokBot, the AI agent that SpaceX AI put out in August, topped 400 ,000 weekly users recently. That data affected September 14th. 418 ,000 users of the AI agent, which represents a 24 % week-on-week jump. Interesting because they released Bot back on August 11th, right? There's been so much focus in the last 24 hours on this being the moment of AI agents, particularly around Muse. Muse is a consumer-focused product from Meta. Grok Bot, a much more enterprise-focused product. But it shows some pretty modest momentum for SpaceX AI, the AI unit of SpaceX. Shares kind of went back towards session highs after we put that report out.

16:21Ed Ludlow:Check it out on the terminal and on Bloomberg.com. The stock up 1.5%. Elsewhere in AI, Alibaba is stepping up its AI ambitions, unveiling what it calls China's most powerful AI chip built to take on NVIDIA. It's just one piece of a much bigger push with more than$53 billion committed to AI and plans for a massive expansion in computing capacity. Bloomberg's Peter Elstrom joins us now. This is really interesting because it was just three, four months ago they put out their last generation chip. This one is three times better. Tell us about it. Yeah, this was a big day at Alibaba headquarters in Hangzhou.

16:56They talked about their ambitions in AI on a few different fronts. First of all, the AI accelerator. They see this as an opportunity to compete, not just with NVIDIA, of course, which is the market leader, but also in the domestic market. Huawei has really been ahead here. Camera Corn has been sort of considered the next best alternative. And Alibaba wants to be in that mix. They want to be talked about as one of the leading designers of these AI accelerators. They hope that they're going to be able to use that to push ahead with their broader ambitions. They also talked about putting together over the long term an LLM with 5 to 10 trillion parameters, really aiming at the frontier models that are out there.

17:35And we have, you know, we've seen DeepSeek and Moonshot in China come out as the leaders in the industry. Alibaba has been a little bit overshadowed by these smaller upstarts in recent weeks and months. but they want to push ahead. And the CEO, Eddie Wu, who did the presentation today, has said that his primary objective now is going to be AGI, Artificial General Intelligence. They're also trying to invest a lot of money in capital. They don't have the same kind of money that the Western companies do, but they're planning on investing in 20 gigawatts of compute to be able to push ahead and compete in that area too.

18:13Ed Ludlow:Just really quick, GenWoo V900 is an accelerator for training. at the frontier, training, just very quickly, that's the use case? Yeah, training at this point, that's their goal. Huawei has tried to push ahead into this area too. The Chinese companies, of course, would like to have more access to the NVIDIA chips that are really the cutting edge here, but Alibaba wants to be able to offer these chips that could do training the same way that Huawei is aspiring to do that too. Bloomberg's Peter Elstrom, thank you very much indeed. Coming up, Silicon Valley's rethinking college for the AI era, The launch of the new Horowitz and Dresden founder, CEO Gargambiani joins us next.

18:51Ed Ludlow:This is Bloomberg. The people who seem to get more done than everyone else. They're not working longer hours or running on more caffeine. They've just stopped wasting time on the stuff that doesn't move work forward. Switching apps, re-explaining context, hunting for files. Those aren't small inefficiencies. They're hours wasted every week. Superhuman Go gives you those hours back. From the makers of Grammarly, Go is an AI assistant that sits inside every tab and tool you already use, always available and already aware of what you're working on. Ask it to draft something, summarize a long thread, pull up a file, or prep you for a meeting.

19:34Go handles it without you ever leaving the page you're on. This is what it looks like when AI actually fits into your work, instead of adding to it. It's like having a teammate whose only job is to help you be better at yours. Go keeps up so you can move forward. With Go working with you, you can show off what you do best. Superhuman Go. Find out more at superhuman.com. That's superhuman.com. Some people treat ChatGPT like some kind of smart search engine, and some use it to get work done. ChatGPT Work is a new way of working in ChatGPT that can take action across your apps and files, stay with a project for hours if needed, and turn a goal into finished work.

20:17It's designed to help you move from a chaotic starting point to a reviewable first version. So all the source materials, briefs, and scattered information that you have to grind through to turn into something useful can just become something useful. Put ChatGPT to work on your most ambitious ideas and projects. Get started at ChatGPT.com by selecting Work Mode, available on Plus and Pro plans. If you listen to financial news, you know a lot of time is spent thinking about what's next. The next opportunity. The next investment. The next move. But sometimes what matters most is being ready for what you never saw coming.

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21:53Ed Ludlow:Welcome back to Bloomberg Tech. This is what financial markets look like. A lot of this relates to oil and whether or not there will be some progress in the Middle East and the Gulf, particularly the Straits of Hormuz. But right now, the S &P 500 flat technology is outperforming a lot of that in the last 24 hours. There's been this discussion about this being the AI agent moment, Muse being the case study. We just broke that news on SpaceX AI's Crock bot also getting some traction. Bloomberg US dollar spot index not really moving as the president of the United States talked about his commitment to AI.

22:28Ed Ludlow:super intelligence and how there is a global scheme against AI, which the US will not participate in. We'll revisit that later in the program. As AI reshapes the workplace, Silicon Valley's rethinking college. The new Horowitz Andreessen Academy is launching an AI focused alternative backed by$42 million and some of tech's biggest names, including OpenAI, Anthropic and NVIDIA. Founder and CEO Gargan Biani joins us now. What is this? This is an academy. This is alternative of education for the AI age, what are we talking about? Yeah, it's a new school built for the most ambitious young high school graduates.

23:05And our goal is to train them for the new era.

23:08Ed Ludlow:What age are we talking about here? Typically 16 to 20. They're going to, they have to have a high school diploma in order to apply and they can be one or two years into college. And so let's get into the skills that we're talking about here, right? You know, actually there is no standard path anymore. But let's say once upon a time, you might have gone to Stanford, done computer science, and then dropped out. Are we talking about competence in coding, computer science still as the pathway? Or this is literally just being fluent in AI, the tools themselves? Yeah, I think at this point, the specific majors are less relevant than the overall skill of building.