Source: Tencent Technology 1. Huang Renxun emphasized that generative AI is growing at an exponential rate and that businesses need to adapt and utilize this technology quickly, rather than standing by and falling behind the pace of technological development. 2. Huang Renxun believes that open and closed source AI models will coexist and that companies need to leverage their respective strengths to promote the development and application of AI technology. 3. Huang Renxun proposed that the development of AI needs to consider energy efficiency and sustainability, reducing energy consumption by optimizing the use of computing resources and promoting the inference and generation capabilities of AI models to achieve more eco-friendly intelligent solutions. 4. With the constant accumulation of data and the continuous advancement of intelligent technology, customer service will become a key area for companies to achieve intelligent transformation. 5. According to foreign media reports, at the 2024 Databricks Data + AI Summit held recently, 6. Founder and CEO Huang Renxun had a fascinating conversation with Ali Ghodsi, co-founder and CEO of Databricks. The dialogue between the two parties demonstrated the importance and development trends of artificial intelligence and data processing technology in modern enterprises, emphasizing the key role of technological innovation, data processing capabilities and energy efficiency in promoting enterprise transformation and industry development. 7. Huang Renxun looked to the future of data processing and generative AI in the conversation. He pointed out that the business data of each company is like an untapped gold mine, with tremendous value but extracting deep insight and intelligence from it has always been a daunting task. 8. Huang Renxun also talked about open source models like Llama and DBRX are driving corporate transformation into AI companies, activating a global AI movement and promoting technological development and corporate innovation. Through the collaboration between NVIDIA and Databricks, the two companies will work together to leverage their respective strengths in accelerating computing and generative AI, bringing unprecedented benefits to users. 9. The following is the transcript of the conversation: 10. Moderator: I am very excited to introduce our next guest, a man who needs no introduction, the one and only global rock star CEO - NVIDIA CEO Huang Renxun. Please come to the stage. Thank you very much for coming! I want to start with NVIDIA's remarkable performance, with a market capitalization of up to 3 trillion US dollars. Did you ever think five years ago that the world would evolve so rapidly and present such a remarkable picture today? 11. Huang Renxun: Absolutely! I expected that from the beginning. 12. Moderator: That's really amazing. Can you offer some advice to the CEOs in the audience on how to achieve their goals? 13. Huang Renxun: Whatever you decide to do, my advice is not to get involved in the development of graphics processors (GPUs). 14. Moderator: I will tell the team that we are not going to get involved in that field. We spent a lot of time today discussing the profound significance of data intelligence. Enterprises have vast amounts of proprietary data that are critical for building customized artificial intelligence models. The deep mining and application of this data are crucial to us. Have you also noticed this industry trend? Do you think we should increase our investment in this area? Have you collected any feedback and insights from the industry on this issue? 15. Huang Renxun: Every company is like a gold mine with abundant business data. If your company offers a series of services or products and customers are satisfied with them while giving valuable feedback, you have accumulated a large amount of data. These data may involve customer information, market trends, or supply chain management. Over the years, we have been collecting these data and have a huge amount of data, but until now, we have just started to extract valuable insights from them, and even higher-level intelligence. 16. Currently, we are passionate about this. We use these data in chip design, defect databases, creation of new products and services, and supply chain management. This is our first time using engineering processes based on data processing and detailed analysis, building learning models, then deploying these models, and connecting them to the Flywheel platform for data collection. 17. Our company is moving towards the world's largest companies in this way. This is, of course, due to the extensive use of artificial intelligence technology in our company, which has helped us achieve many remarkable achievements. I believe that every company is experiencing such changes, so I think we are in an extraordinary era. The starting point of this era is data, and the accumulation and effective use of data. 18. The harmonious coexistence of open source and closed source 19. Moderator: This is truly amazing and very much appreciated. At present, the debate about closed-source and open-source models is gradually heating up. Can open-source models catch up? Can they coexist? Will they eventually be dominated by a single closed-source giant? What is your view of the entire open-source ecosystem? What role does it play in the development of large language models? And how will it develop in the future?

According to foreign media reports, the US Department of Justice has sued Google for monopoly. In the 286-page ruling, US federal district judge Amit Mehta conducted detailed factual findings and legal judgments on Google's monopolistic behavior in the search engine field. This ruling not only reveals the various strategies adopted by Google to maintain its market dominance, but also exposes the controversial remarks among company executives, embarrassing internal research, and the shocking details of the multi-billion-dollar contract between Google and Apple. $Alphabet-C (GOOG.US)$ Apple believes that Microsoft Bing's performance is poor.

Every year, Google pays billions of dollars to ensure that its search engine becomes the default option on Apple's Safari web browser. In the trial, Eddy Cue, Apple's senior vice president responsible for service business, said: "No matter what, we're going to be paying someone. Why not get paid by the best?"

Google subsidizes $Apple (AAPL.US)$ But in the trial, Eddy Cue, Apple's senior vice president responsible for service business, said: "No matter what, we're going to be paying someone. Why not get paid by the best?"

"No matter what" was said by Eddy Cue, Apple's senior vice president responsible for service business, in the trial. $Microsoft (MSFT.US)$ For Google, this means that they have already won this default position, even though they do need to pay a lot of money to maintain it. Judge Mehta pointed out, "This highlights an undisputed fact that Google has become the only choice in the area of default general search engine."

2. Fortune 500 companies can only choose Google

Only Google is selected by the Fortune 500 companies.

Google not only established a close cooperative relationship with Apple, but also signed agreements with mobile operators and device manufacturers to ensure its position as the default search engine on Android devices. Although the operational mechanisms of these agreements differ slightly, they are all based on Google's dominance in the app store.

According to the latest news from The Information, after winning the anti-monopoly lawsuit against Google, the US Department of Justice may seek to make major changes to the company, such as enforcing the separation of Android.

It is worth noting that almost all tech companies regard Google search as the only choice.

Judge Mehta bluntly pointed out in the ruling: "Google understands that in the matter of default search engines, its market position is solid and there is little competition. This is because partners understand that giving up Google also means giving up the huge revenue sharing it provides, which is often in the hundreds of millions or even billions of dollars. Therefore, partners often weigh it repeatedly and believe that it is not wise to replace default search engines or seek greater autonomy on search products from a financial perspective."

The mutually beneficial agreement between Google and Apple has been in place for ten years.

According to the ruling, "In order to occupy the exclusive and non-exclusive default search engine position on Apple's devices, Google paid a significant portion of its net advertising revenue to Apple. By 2022, this amount has reached 20 billion U.S. dollars. This number is almost twice the amount Google paid in 2020, when the amount accounted for 17.5% of Apple's operating profit."

The current contract signed between Google and Apple can be traced back to 2016, and the cooperation between the two parties goes much further. It is worth noting that around 2016, Apple also launched a new feature Suggestions, which had a significant impact on Google. Google's analysis showed that due to Apple's Suggestions feature, its search traffic in the Safari browser decreased by 10% to 15%, and its advertising revenue on iOS Safari decreased by about 4% to 10%.

In response to this situation, Google added a clause to the contract signed in 2016, which stipulated that Apple must "keep it basically the same" as the previous version in implementing the default search engine on Safari, in order to limit Apple's further expansion in search functions and avoid Google losing more traffic due to Apple's innovation.

Now, on the iPhone, 'Google has almost taken over 95% of the general search queries.'

The 2016 contract terms seemed to benefit both companies. Google and Apple extended the agreement in 2021, and the contract will expire in 2026. However, Apple 'can unilaterally extend the agreement by two years,' and if both parties are interested, they can further extend the contract until 2031. According to the contract agreement, Google and Apple are both obligated to defend the agreement, 'in response to antitrust regulatory actions such as those brought by the Department of Justice.'

How difficult is it for Apple to challenge Google's search engine?

Judge Metta pointed out that the huge amount of money that Google paid to Apple not only weakened Apple's willingness to challenge Google's dominance in search, but even if Apple had such willingness, it would face insurmountable obstacles. Both Google and Apple conducted related research and disclosed internal estimates during the trial.

Apple estimates that to operate a comprehensive general search engine, in addition to the current search development costs, it also needs to invest up to 6 billion US dollars annually. Google's evaluation at the end of 2020 shows that for Apple to replicate Google's current technological infrastructure, it will require at least 20 billion US dollars.

Is TikTok a competitor to Google search?

TikTok is obviously not.$Amazon (AMZN.US)$and $Meta Platforms (META.US)$ are also not. In the Google antitrust case, the court proposed two concepts: general search engine (GSE) and professional vertical provider (SVP). Among them, the general search engine is the common search engine as we know it, including Google, Bing, DuckDuckGo, and others.

In addition to this, there are thousands of 'small search boxes' on the Internet for finding specific information or buying commodities. However, services such as Booking.com and Amazon.com are not general search engines, and they differ significantly from general search engines that index the entire World Wide Web.

There are also search boxes on social media platforms, such as the search function on TikTok, which operates slightly differently from the operation of general search engines in terms of user behavior. However, in 2021, Google found that among the Z generation (18-24 years old) users who use TikTok daily, 63% of them said that they use TikTok as a search engine.

However, Judge Metta pointed out that social media platforms are different from others, and they can be regarded as 'content gardens with walls.' More importantly, 'there is almost no evidence that they are actually competing with general search engines.' He said that research on TikTok did not explore whether the platform's search quality competes with Google search, just because young people like TikTok does not mean it has competitiveness in the relevant market for Google search.

In addition, TikTok is not the only dominant social platform. Judge Metta mentioned that some research shows that the use of Facebook is positively correlated with the growth of Google search volume.

Under the analysis of antitrust, Judge Metta believes that the online habits of Z generation users are not a key consideration. He wrote: 'Imagine, if Google's search quality shows a significant decline, whether intentional or accidental, can we reasonably expect, If Facebook's senior vice president or any other social media platform can quickly deploy resources and launch a product that is competitive with Google search engine, and attract a large number of dissatisfied Google users? The answer is self-evident, this is extremely difficult. Even industry giants like Amazon or Meta will face huge costs and expenditures if they want to fill this market gap.'

6. When will the AI search revolution come?

When will the AI search revolution come?

Judge Metta added: 'Generative artificial intelligence has not (at least not yet) eliminated or significantly reduced its dependence on user data to maintain high-quality search results.' This conclusion is supported by Sridhar Ramaswamy, co-founder of Neeva: 'In specific contexts, the process of identifying the pages most relevant to a query is still highly dependent on user click behavior data.' He emphasized that the artificial intelligence model not only does not eliminate, but also strengthens this data requirement.

In other words, when you search for 'golf shorts,' Google not only presents relevant results but also captures your preferences accurately through the pages you click on, thus continuously optimizing the relevance of search results. This feedback-based loop mechanism has not yet been seen in artificial intelligence chatbots.

Involving antitrust analysis, Judge Metta believes that the online habits of Z-generation users are not a key consideration. He wrote: 'Imagine, if Google's search quality shows a significant decline, whether intentional or accidental, can we reasonably expect, if Facebook's senior vice president or any other social media platform can quickly deploy resources and launch a product that is competitive with Google search engine, and attract a large number of dissatisfied Google users? The answer is self-evident, this is extremely difficult. Even industry giants like Amazon or Meta will face huge costs and expenditures if they want to fill this market gap.'

In addition, the ruling also cited the opinion of Google's search vice president, Pandu Nayak, who believes that maintaining "an infrastructure that is capable of understanding and operating effectively" - that is, the traditional ranking system - is crucial. He said: "It makes no practical sense to completely hand over rankings to emerging systems at this stage. we still need to maintain a certain degree of control and understanding."

"Things that only monopolists can do"

Google conducted an internal study in 2020 to explore the potential impact of "significantly reducing search quality" on its profitability. The study found that even if Google deliberately reduces the search experience, the revenue from its search services would not be significantly affected.

Judge Mehta commented: "Google has the freedom to adjust its products without the risk of losing users, which is something only monopolies can do."

The core of antitrust regulation is to maintain fairness in market competition. Competition is the cornerstone of driving market prosperity, promoting corporate growth, and protecting consumer rights. In the era of the internet, the applicability of "consumer harm" as a measure of monopolistic behavior may be controversial, but the Google antitrust case undoubtedly provides us with a powerful example: even industry leaders known for innovation may use traditional means of stifling competition to exert hidden harm to consumers - even if the service quality declines, Google can still maintain considerable revenue after excluding competitors.

Editor/Somer