The Chinese Chip Giant That Could Be Nvidia's Biggest Threat

Eva Dou (0:02)

Bloomberg Audio Studios, podcasts, radio, news.

Joe Weisenthal (0:18)

Hello, and welcome to another episode of the Odd Lots Podcast. I'm Joe Weisenthal.

Tracy Alloway (0:23)

And I'm Tracy Alloway.

Joe Weisenthal (0:24)

Tracy, we recently did that episode with Mackenzie Hawkins talking about some of the geopolitics of AI and chips, et cetera. And when it comes to AI chips, it basically is Nvidia and nobody else, but there is one other company that's clearly lurking out there in the picture.

Tracy Alloway (0:40)

Huawei.

Joe Weisenthal (0:41)

Yes, right. So that was one of the things that came up, which is that, yes, Nvidia has this huge dominance within AI, but there is this Chinese company, as you said, Huawei, that is making a lot of progress. If there's one area of concern or if there's one possibility that another company's tech could really sort of form the backbone of AI, this is probably them.

Tracy Alloway (1:04)

I find Huawei really fascinating as a company. So it's sort of this national champion, right? And even the name, I think, means something like China has achievements or China is able to achieve or something like that. And yet, it has these like really weird European headquarters, European style headquarters. Yeah, they look like French castles and things like that. And you hear all these stories about how aggressive some of the Huawei sales tactics are. There was the arrest of the founder, Rin Zhengfei's daughter a few years ago. So, there's just all this stuff going on and like kind of weird tensions. And I want to learn more about what this company actually is and what it does.

Joe Weisenthal (1:49)

Totally. A lot of mystery, a lot of perhaps paranoia, a lot of concern about what it does and who it is and its connection to the Chinese government, the CCP, etc. Anyway, we have to learn more if this is going to be the one company that could at some point in the future threaten Nvidia. And we really do have the perfect guest to talk about it. We are going to be speaking with Eva Dou. She is the author of the fairly new book that came out earlier this year, House of Huawei, The Secret History of China's Most Powerful Company. It's really an extraordinary book. I actually think that someone asked me the other day, what are a few books you would read about China these days? And this is now, I think, sort of an instant classic. So Eva, thank you so much for coming on Odd Lots. Kind of perfect timing.

Eva Dou (2:33)

Thank you so much for having me here.

Joe Weisenthal (2:35)

Actually, it's really perfect timing because just today, the founder of the company, Ren Zhengfei, gave a interview with People's Daily. And it's clear in your reporting, he does not do like a ton of media, et cetera. He's certainly not like Jensen Huang, always talking to the press. What do you take away from that, that suddenly there's a, just to, I think literally just today or maybe yesterday, that there's a Ren Zhengfei interview with People's Daily?

Eva Dou (3:01)

Yeah, so this is very, very rare for them to publish a full interview transcript with a private enterprise entrepreneur on the front page of the People's Daily, which is the party's mouthpiece and usually is chronicling what the nation's leader, Xi Jinping and other senior officials are doing. And I think it really speaks to Huawei's sort of central role now in China's tech industry. And not only that, in diplomatic relations, this is the message to the United States and the world for them to put his words on the front page of People's Daily at a time when Huawei is very much in the crosshairs of the Trump administration.

Tracy Alloway (3:43)

I want to ask the pressing question on my mind and then maybe get into other important stuff. But what is the deal with the European Castle headquarters for this company that has sort of grown in tandem with the Chinese economy and is considered a national champion, a national symbol in many ways? Why do they have French castles and Greek statues as their headquarters?

Eva Dou (4:07)

Yeah, this is one of the strange and amusing things about this company. They have this sort of larger-than-life campus that just mystifies people when they come to visit. They have a replica of Versailles. They have a replica of the Castle of Heidelberg from Germany. And they have their R&D operations in these European-style castles. And it's very strange to people. And this has never been fully explained by the company. But in a way, it does show the level of their ambition. They are building an empire far more than just what many people think of a single tech company does, and it's global footprint.