CNBC — Technology · September 28, 2026 · On the brief until October 12, 2026

Jensen Huang says AI distillation is 'competition.' Scott Bessent has called it 'theft'

Intellectual Property LawEconomics

THE AI ANGLE

Producing training outputs for rival systems

Nvidia chief executive Jensen Huang defended AI model distillation as normal competition, opposing United States officials who label the practice theft. The disagreement pits proposed government trade penalties against corporate arguments that learning from rival outputs drives market improvements.

Summary written by AI Business Lens with an AI model from the article at cnbc.com. It is not the article, and the publisher has not reviewed it. For publishers.

THE TEACHING ANGLE

The conflict centers on whether extracting capabilities from another model's outputs constitutes actionable intellectual property theft or standard competitive reverse engineering.

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Jensen Huang says AI distillation is 'competition.' Scott Bessent has called it 'theft'

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