Ben Thompson Writes Stratechery, a subscription newsletter analyzing the business strategy behind tech and media companies, and has built a reputation for framing how platfo...

“I think that started the entire NVIDIA versus the national security apparatus immediately on a bad foot. From that day forward, they viewed him as a bad actor, and he viewed them as idiots. And all the dynamics flow from those two things.”

Sharp Tech with Ben Thompson · Tech Strategy & Big Tech · November 2026

Context

Thompson traces Nvidia's feud with Washington to the first China chip rules, when Nvidia quickly shipped a cut-down chip that stayed just inside the law. Officials read it as circumvention, and Huang read their rules as foolish.

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Transcript

Sharp Tech with Ben Thompson Around 56:49 into the episode

Ben Thompson

…the benefits now, is thinking long-term. How do I preserve this? How do I keep what I have? This, and I think this, and that's why he wants to sell to China. It's super important for his moat to sell to China above and beyond. Of course, he wants to sell everywhere so he can make more money.

Andrew Sharp

More customers also sort of preserves the pricing power for NVIDIA. Question: So, I think,

Ben Thompson

so I think a really illustrative episode: NVIDIA had no presence in Washington, D.C. So, the China chip ban comes out and it gates the first version under Biden, and it gates what you can sell based on not on flops, but on like memory bandwidth, which was actually a relative. I actually thought the V1, I disagreed with it, but I thought it was that was the way to construct it. Because what you're constraining is the large systems you can use because those are limited by bandwidth. So, what did Jensen do? Within a month, they had come out with a new chip that had less bandwidth. And to be clear, that meant it was a worse chip. It was not as useful for training because it had less bandwidth. They literally go into chips and just like burn off the connections or like and so you have to link

Andrew Sharp

more of the chips together to get comparable power, correct? It's

Ben Thompson

not going to be comparable. Like, you're just fundamentally limited if you don't have a sufficient bandwidth and you're not going to be able to scale as much, do as large models, all these sorts of things. My view, my interpretation at the time is that immediately put NVIDIA behind the eight ball…

Andrew Sharp

yeah. I mean, it's funny because when you zoom out, there's a parallel here to Dario Amade and Anthropic saying, We've got a signed contract with the United States government that says we can dictate this, that, and the other thing, and then trying to dictate terms to the U.S. government how. Their…

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