Nvidia acquired Hugging Face for $13bn, cementing its position as the dominant chipmaker powering AI. The deal grants Nvidia access to Hugging Face's open-source AI models, an 'app store for AI' that users can customize. This strengthens Nvidia's Nemotron models and promotes open-weight AI that runs on its chips.

Open models are 20-30% cheaper than closed ones from Open AI and Anthropic, whose valuations have surged to nearly $1tn each. Nvidia's move may disrupt rivals while maintaining its ecosystem through strategic investments in Open AI, Anthropic, and other tech giants. Despite potential conflicts, CEO Jensen Huang prioritizes long-term chip dominance over alliances.

Companies like Uber already struggle with AI costs, highlighting the tension between open and closed models. Nvidia's interconnected investments secure its future market while potentially reshaping the AI landscape.