Episode Details
Back to Episodes
Why Is Everyone Moving Across the AI Stack?
Description
In this episode of EconWorks, we look at why some of the biggest AI companies are jumping across different layers of the AI stack. Nvidia transitions from compute to developer platforms via Hugging Face. World Labs is the pivot from compute to model development for AMD. Cursor sits near the application layer and flows upstream toward models and compute. All three moves look like vertical integration at first glance. But the economic logic is different in each of these cases. Nvidia may be trying to build demand for AI compute. Maybe AMD is trying to obtain better hardware, software, and systems so it can compete better. Cursor might be trying to take more control over the models and compute underneath it to improve the application. The antitrust question isn't just whether firms are moving up and down the AI stack. But that is different when you own it. Does integration enhance output, improve products, and enhance competition? Or does it result in foreclosure, steering, higher rivals’ costs, or control over an important bottleneck?
Read the full article and graphic analysis: https://blog.econworks.com/p/why-is-everyone-moving-across-the?r=562wri
Explore more visual economics content: https://econworks.com
YouTube: https://www.youtube.com/@EconWorks-d3e
Substack: https://blog.econworks.com
This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit blog.econworks.com/subscribe