Former Assistant AG Kanter on the non-exclusive licensing agreement in the Nvidia-Groq deal
2025-12-29_15-47 • 4m 42s
? (?)
00:00.280
Joining
us
to
discuss
that
structure
and
regulatory
issues
around
it
is
Jonathan
Cannon.
Of
course,
he's
the
former
assistant
attorney
general
for
any
trust
at
the
DOJ,
also
a
CNBC
contributor.
And
Jonathan,
I
really
wanted
to
get
your
take
on
this
because
I
reported
was
? (?)
00:14.480
reporting
it
out
on
Wednesday
and
it
was
hard
to
sort
of
navigate
it
in
terms
of
what
are
they
actually
acquiring,
how
are
they
doing
it,
and
why
are
they
designing
it
this
way?
It's
an
innocuous
headline,
right?
A
a
non-exclusive
licensing
agreement
doesn't
seem
to
be
? (?)
00:29.480
particularly
really
significant,
and
yet
Nvidia
is
paying
an
enormous
amount
of
money
for
this.
As
an
antitrust
regulator,
how
do
you
view
these
deals?
Because
this
is
not
an
isolation.
We've
seen
similar
deals
from
Nvidia
in
the
past,
from
Meta,
for
Scale
AI,
and
others.
Do
you
? (?)
00:46.640
think
they
are
designed
to
sort
of
avoid
scrutiny
from
the
regulatory
side?
Jonathan Kanter (CNBC Contributor)
00:51.520
Well,
if
they
are,
then
that's
a
problem.
So,
there's
a
a
a
legal
doctrine
in
antitrust
called
an
avoidance
device.
Uh,
an
avoidance
device
means
if
you
if
a
company
structures
a
transaction
in
order
to
avoid
a
mandatory
notification
form
under
the
Hark
Scott
Rodino
Act
and
Jonathan Kanter (CNBC Contributor)
01:10.000
antitrust
notification,
then
that
itself
is
illegal.
And
so
to
the
extent
that
the
parties
design
the
transaction
using
non-exclusive
licenses
and
reverse
aqua
hires
and
the
whole
list
of
significant
but
quote
and
quote
non-significant
events,
then
then
that
itself
can
raise
Jonathan Kanter (CNBC Contributor)
01:29.040
antitrust
scrutiny.
for
violating
the
process
of
filing
with
the
agencies.
And
so
that's
a
concern.
And
then
on
top
of
that,
agencies
do
have
to
make
sure
that
this
doesn't
become
the
standard
of
practice
as
a
way
to
circumvent
their
review.
And
so
this
is
it
certainly
caught
my
Jonathan Kanter (CNBC Contributor)
01:49.400
eye
and
it
caught
the
eye
I'm
sure
of
many
others
in
the
and
I
trust
community.
Yes,
? (?)
01:53.320
I'm
curious
as
to
how
you
think
about
it
then
this
particular
deal
or
others
like
it.
I
mean,
we're
licensing
their
key
technology,
not
not
exclusively,
and
by
the
way
we're
taking
virtually
all
their
important
employees,
but
it's
not
an
acquisition.
I
don't
know.
I'm
just
? (?)
02:09.440
curious
like
how
you,
you
know,
if
you
were
sitting
in
your
old
chair
at
the
DOJ,
how
you'd
be
thinking
about
it?
Jonathan Kanter (CNBC Contributor)
02:14.520
Well,
here's
what
I
would
tell
my
team,
which
is
if
it
looks
like
a
duck
and
quacks
like
a
duck,
then
it
ate
a
pig.
Um
and
in
this
instance,
uh
they're
getting
the
the
key
employees,
they're
getting
access
to
the
technology.
Um
it's
a
direct
competitor
and
they're
paying
an
arm
Jonathan Kanter (CNBC Contributor)
02:30.320
and
a
leg.
Um,
that
looks
and
sounds
a
lot
like
an
acquisition.
Uh,
and
so
I
would
instruct
the
team
to
make
sure
that
they're
investigating
the
transaction
and
its
competitive
consequences
as
if
it
were
an
acquisition
because
that's
what
the
antitrust
laws
are
there
to
do.
If
Jonathan Kanter (CNBC Contributor)
02:47.080
there's
a
problem,
then
they
need
to
intervene.
If
there's
no
problem,
they
can
stand
aside
and
let
the
deal
go
through.
? (?)
02:53.200
Right,
we
should
point
out
we
haven't
gotten
a
lot
of
detail
around
the
deal
itself
from
Nvidia
at
all
other
than
an
internal
member
from
Jensen
just
announcing
the
arrival
of
some
of
these
key
hires.
They're
not
a
full
stack
competitor
Grock
in
any
way
to
Nvidia,
but
they
are
? (?)
03:07.960
seen
as
perhaps
helping
the
overall
GPUs
in
terms
of
their
particular
expertise
called
the
LPU.
I
don't
know
how
much
you
know
about
it
Jonathan
or
you
know
care
to
discuss
it.
I
would
assume
regulators
need
to
be
taking
a
close
look
though
in
terms
of
whether
there
really
is
a
? (?)
03:25.040
competitive
aspect
to
it.
Jonathan Kanter (CNBC Contributor)
03:28.280
Well,
that's
exactly
right.
I
mean,
this
is
This
is
typically
how
competition
presents
itself
in
technology
markets.
It
may
not
be
that
a
competitive
threat
is
a
full
stack
competitor,
but
here
you
have
training
which
Nvidia
does
better
than
anybody
and
it's
extremely
expensive
Jonathan Kanter (CNBC Contributor)
03:45.040
and
their
chips
are
really
hard
to
get.
They
take
a
long
time
to
get
and
they
consume
a
ton
of
energy.
Then
you
have
inference
which
is
when
you
use
the
chips.
And
that's
where
Grock
really
has
figured
out
a
way
to
do
it
faster,
cheaper
and
with
consuming
a
lot
less
energy
and
a
Jonathan Kanter (CNBC Contributor)
04:01.640
much
shorter
wait
time
to
get
the
chip.
And
so
it
is
competing
for
certain
workloads
and
for
inference
against
Nvidia
and
in
that
sense
one
could
at
least
question
whether
Grock
has
emerged
as
a
threat
to
demote
that
protects
Nvidia.
And
so
by
doing
this
deal
one
of
the
Jonathan Kanter (CNBC Contributor)
04:22.920
questions
you
want
to
ask
as
an
enforcer
not
only
is
Nvidia
acquiring
the
technology
and
the
employees
of
a
direct
competitor,
but
is
it
weakening
somebody
who
left
to
their
own
devices
would
have,
you
know,
grown
in
size
and
significance
to
take
more
business
away
from
the
Jonathan Kanter (CNBC Contributor)
04:41.080
video.
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