The competitive landscape for AI chips is not a crowded field but a battle between two primary forces: NVIDIA’s integrated system (hardware, software, networking) and Google's TPU. Other players like AMD and Broadcom are effectively a combined secondary challenger offering an open alternative.

After selling its internal self-driving unit, Uber has successfully re-entered the market by becoming a network orchestrator instead of a builder. By partnering with Nvidia for the hardware/cloud stack and various carmakers, Uber leverages its massive user base and data to create a powerful ecosystem without bearing all the R&D costs.

By releasing open-source self-driving models and software kits, NVIDIA democratizes the ability for any company to build autonomous systems. This fosters a massive ecosystem of developers who will ultimately become dependent on and purchase NVIDIA's specialized hardware to run their creations, driving chip sales.

While known for its GPUs, NVIDIA's true competitive moat is CUDA, a free software platform that made its hardware accessible for diverse applications like research and AI. This created a powerful network effect and stickiness that competitors struggled to replicate, making NVIDIA more of a software company than observers realize.

To address safety concerns of an end-to-end "black box" self-driving AI, NVIDIA runs it in parallel with a traditional, transparent software stack. A "safety policy evaluator" then decides which system to trust at any moment, providing a fallback to a more predictable system in uncertain scenarios.

Instead of building its own capital-intensive robotaxi fleet, Waive's go-to-market strategy is to sell its autonomous driving stack to major auto manufacturers. This software-centric approach allows them to leverage the scale, distribution, and hardware infrastructure of established OEMs to reach millions of consumers.

NVIDIA's vendor financing isn't a sign of bubble dynamics but a calculated strategy to build a controlled ecosystem, similar to Standard Oil. By funding partners who use its chips, NVIDIA prevents them from becoming competitors and counters the full-stack ambitions of rivals like Google, ensuring its central role in the AI supply chain.

Beyond selling chips, NVIDIA strategically directs the industry's focus. By providing tools, open-source models, and setting the narrative around areas like LLMs and now "physical AI" (robotics, autonomous vehicles), it essentially chooses which technology sectors will receive massive investment and development attention.

NVIDIA investing in startups that then buy its chips isn't a sign of a bubble but a rational competitive strategy. With Google bundling its TPUs with labs like Anthropic, NVIDIA must fund its own customer ecosystem to prevent being locked out of key accounts.