# Palantir CEO: AI companies have to be nationalized to cap their liability

*CNBC Television* · https://www.youtube.com/watch?v=FU8PTvIxgJA

## Summary

In a CNBC exclusive, Palantir co-founder and CEO Alex Karp discusses the wave of AI safety warnings and argues the real issue is not regulation but liability. He says Palantir's commercial clients are furious that their business ideas and data — their "alpha" — are being absorbed into models via discounted tokens. He argues that AI companies absorbing the world's IP face unlimited liability, and only the US government can cap it, so those businesses effectively have to be nationalized.

## Key points

- Alex Karp says Palantir was the first company to build functional AI technology in the military context and dominates the application space.
- Palantir's commercial clients are livid about what they see as the theft of their alpha — their business ideas and data landing in models used by competitors.
- Karp argues discounted tokens exist so model providers can access clients' IP and improve their models, with no honest disclosure.
- Karp expresses respect for Dario Amodei as an ethical entrepreneur but says the safety debate is not really about regulation.
- Karp claims the philosophical frame of absorbing all the world's IP requires severe liability protection, which only the US government can provide.
- He concludes AI companies effectively have to be nationalized to cap their liability, or clients will sue.

## Notes

### Context
Alex Karp, co-founder and CEO of Palantir, speaks with CNBC during a week of heightened AI safety warnings. Palantir has been at the forefront of using AI in the military context and claims to dominate the application space and US commercial AI.

### Client anger over 'theft of alpha'
Karp says Palantir's commercial clients are livid about a specific safety issue: their alpha — their ideas for how to run their business and their data — landing in a model, only for a competitor next door to end up with that same knowledge. He notes the clients paid for the service, and quotes the least vulgar of their reactions.

### The sovereignty revolution
Karp explains the "sovereignty revolution," which he says Palantir launched together with Nvidia founder and CEO Jen-Hsun Huang. His argument: when you use a closed model and pay for tokens, the tokens are discounted not to grow the market but so providers can access your IP and improve their models — with functionally no honest conversation or disclosure about this.

### On Dario Amodei
Karp calls Dario one of the most important entrepreneurs and says he is both ethical and a businessperson. He notes it is common for companies to raise safety when business is not going well, but says he does not think that is what is driving this.

### Nationalization argument
Karp's central claim: if a company's philosophical frame is that it deserves all the IP in the world, that model would require severe liability protection — and only one institution can provide it, the US government. Investors did not realize they were "the mark": first all the IP migrates to the business, then the business must migrate to the government to cap liability. He says the movement reported as regulation versus non-regulation is actually about nationalizing AI companies, because otherwise every client will sue.

## Transcript

[00:00] ROGUE AI HACKS ACROSS SEVERAL COMPANIES. IT'S A RISK OUR NEXT GUEST HAS BEEN WARNING THE TECH INDUSTRY ABOUT FOR MONTHS, HIS COMPANY WRITING IN JUNE YOUR AI SOVEREIGNTY DICTATES YOUR INSTITUTION'S FUTURE. HERE WITH US NOW AT POST NINE. IN A CNBC EXCLUSIVE INTERVIEW WITH PALANTIR CO-FOUNDER AND CEO ALEX KARP. WELCOME BACK. IT'S GOOD TO SEE YOU. DELIGHTED TO. >> BE HERE. YOU KNOW, I'VE BEEN HERE MANY TIMES WITH YOU. >> YES. >> AND YOU GUYS ARE TOUGH. BUT AMONG MY FAVORITES. >> OKAY. WELL THANK YOU. >> YOU KNOW YEAH. >> WE'RE EXCITED TO TALK TO YOU BECAUSE THIS IS A REALLY IMPORTANT WEEK. AND THERE'S BEEN THIS EXPLOSION OF AI SAFETY WARNINGS. WHERE DO YOU STAND? WELL. >> OKAY, WE'VE WE'VE BEEN IN

[00:39] THE FOREFRONT OF USING AI IN THE MILITARY CONTEXT. THE FIRST COMPANY TO BUILD ACTUALLY A FUNCTIONAL AI TECHNOLOGY, AS IS CURRENTLY WELL KNOWN, WE'RE DOMINATING THE APPLICATION SPACE. WE HAVE A PRODUCT. SO THERE'S A LOT OF WE HAVE A LOT OF EXPERIENCE WITH LIKE WHAT WORKS, WHAT DOESN'T. THERE ARE REALLY DIFFERENT KINDS OF SAFETY ISSUES, QUITE FRANKLY, ALMOST ALL MY. WE DOMINATE US COMMERCIAL AS A COMPANY AND THE CLIENTS, OUR PARTNERS ARE LIVID AT THE KIND OF SAFETY THEY'RE MOST UPSET ABOUT, WHAT THEY BELIEVE IS THE THEFT OF THEIR ALPHA, MEANING THEIR IDEAS OF HOW TO RUN A BUSINESS, THEIR DATA IN LANDING IN A MODEL, AND THEY FIND OUT THAT THE COMPETITOR NEXT DOOR HAS ALL OF THEIR ALPHA MEANING HOW THEY DO

[01:22] THEIR BUSINESS, AND THEY PAID FOR IT. I MEAN, I CAN'T REPEAT WHAT THE CUSTOMERS ARE SAYING, BUT THEY'RE BASICALLY LIKE ONE TO GIVE YOU THE ONE THAT WAS THE LEAST VULGAR. IT'S LIKE, BUT BUT HOW CAN THEY TELL ME NOT TO WEAR A CONDOM LIKE THIS IS? AND THAT'S THE LEAST VULGAR PERSON THAT WE DEAL WITH. THEY'RE LIKE LIVID. AND SO THEY'RE LIVID. SO THAT'S. >> WAIT, CAN YOU JUST TRANSLATE WHAT YOU'RE TALKING ABOUT? SO IS THIS BECAUSE THE LMS FAULT THEY'RE SHARING. >> NO, NO. OPEN THE REASON WHY THE SOVEREIGNTY REVOLUTION, WHICH WE HELPED LAUNCH TOGETHER WITH OUR PARTNER JEN-HSUN HUANG, THE FAMOUS FOUNDER AND HEAD OF NVIDIA, IS THE WHEN YOU USE A CLOSED MODEL AND YOU PAY FOR TOKENS, YOU'RE NOT. THE REASON

[02:09] THE TOKENS ARE DISCOUNTED IS NOT. SO THEY CAN GROW THE MARKET. THEY'RE DISCOUNTED SO THAT THEY CAN GET ACCESS. TO THEIR IP SO THAT THEIR MODELS GET BETTER. AND THERE WAS FUNCTIONALLY NO HONEST CONVERSATION ABOUT THIS OR DISCLOSURE. NOW THAT'S POINT ONE. POINT TWO IS WITHOUT AN APPLICATION LAYER AND WITHOUT POST TRAINING, WHICH IS CURRENTLY BEING DONE WITH OPEN WEIGHT MODELS, YOU IN THE CLASSIFIED SIDE. AND IT'S JUST TAKING OFF ACROSS AMERICA BECAUSE IT'S CHEAPER AND ENDS UP BEING SAFER. AND YOU CONTROL YOUR FUTURE AND YOUR PRESENT, YOU ARE DE FACTO OUTSOURCING THE VALUE OF, BY THE WAY, IT'S VERY MUCH LINKED TO THE SAFETY CONCERNS. NOW, DARIO IS ONE OF THE MOST IMPORTANT ENTREPRENEURS. I'VE BEEN AT

[02:49] THIS FOR A LONG TIME. I'VE NEVER SEEN ANYONE COME FROM THE BACK. TO YOU. LIKE, I HAVE A LOT OF RESPECT FOR HIM, AND I HAVE A LOT OF RESPECT FOR HIM BECAUSE HE'S ACTUALLY BELIEVES, OF COURSE, HE'S A BUSINESS PERSON TOO, MOST SOMETIMES. SO OF COURSE, WHEN THE COMPANY'S NOT DOING AS WELL, THESE THINGS COME FORWARD AND THEY TALK ABOUT SAFETY. AND WHEN IT'S DOING BETTER, THEY. >> THINK THAT'S WHAT'S GOING ON. >> I DON'T THINK THAT'S ACTUALLY WHAT'S DRIVING THIS. BUT YOU KNOW, I MEAN, IT DOES HAPPEN REGULARLY. BUT I THINK THAT, YOU KNOW, HE'S WHAT MAKES HIM SO STRONG IS HE'S ETHICAL AND A BUSINESS PERSON. OKAY. SO BUT BUT BUT WHAT'S ACTUALLY HAPPENING IS VERY DIFFERENT THAN WHAT PEOPLE ARE REPORTING.

[03:25] EVERYONE THINKS THIS IS A SAFETY VERSUS NON SAFETY VERSUS REGULATION. WHAT, WHAT WHAT HE, I BELIEVE IS REALIZED IS IT IF YOU IF YOU TAKE THE PHILOSOPHICAL FRAME THEY HAVE, WHICH IS WE ARE DESERVING OF HAVING ALL THE IP IN THE WORLD, WE THE THOUSAND PEOPLE WHO THINK THE WAY WE DO. THAT'S WHY YOU CAN'T WORK WITH THE MILITARY. THAT'S WHY YOU CAN TAKE THE IP FROM BUSINESSES AND PUT IT IN YOUR MODEL THAT THAT MODEL WOULD REQUIRE SEVERE LIABILITY PROTECTION. AND THERE'S ONLY ONE INSTITUTION THAT CAN DO THAT, THE US GOVERNMENT. AND THEN THAT'S BEFORE YOU GET TO THE DANGER. SO WHAT WHAT'S REALLY HAPPENING IS THE INVESTORS LOVED WHEN HE WAS MIGRATING ALL THE VALUE OF EVERYONE ELSE'S BUSINESS TO THEIR BUSINESS, BECAUSE THEY'RE

[04:08] INVESTORS, THEY DON'T REALIZE. IT'S LIKE, IT'S LIKE EVERY MARK, THEY DON'T REALIZE THEY'RE THE MARK BECAUSE NOW YOU FIRST YOU MIGRATE ALL THE IP TO YOUR BUSINESS, AND THEN BECAUSE YOU NEED UNCAPPED, YOU NEED CAPPED LIABILITY, BOTH VIS A VIS THE BUSINESS AND VIS A VIS THE DANGERS. YOU'VE GOT TO MIGRATE THE BUSINESS TO THE GOVERNMENT. IT HAS TO BE NATIONALIZED. SO IT'S ACTUALLY HAPPENING. THIS IS REPORTED AS REGULATION NON-REGULATION MOVEMENT. THAT'S ACTUALLY NOT WHAT THIS MOVEMENT IS. IT'S LIKE THE VIEW THAT I BELIEVE THEY HAVE IS THESE BUSINESSES HAVE TO BE NATIONALIZED, BECAUSE IF YOU DON'T NATIONALIZE THEM, EVERY SINGLE ONE OF MY CLIENTS IS GOING TO SUE. >> THAT'S YOU THINK THAT'S WHAT THEY WANT?

[04:45] >> WELL, OBVIOUSLY, LIKE IF YOU HAVE A BUSINESS THAT PRESUPPOSES UNLIMITED RISK, BOTH VIS A VIS LIABILITY RISK VIS A VIS THE CLIENTS, BECAUSE I DON'T THINK ANY OF OUR CLIENTS REALIZE THEIR IP WAS MIGRATING VIS A VIS THE WORLD. BECAUSE YOU'RE SAYING, WHAT IS THE LIABILITY RISK FOR DESTROYING 10% OF THE COMPANY, 10% OF THE WORLD DISCOUNTED INTO THE PRESENT. OKAY. BUT THERE'S ONLY ONE INSTITUTION. AND BY THE WAY, THAT'S NOT ACTUALLY WHAT'S HAPPENING. THEY WANT THREE INSTITU