Xavier Niel: The Maverick Behind French AI’s Surge and TikTok’s New Strategic Vision

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Xavier Niel, a Key Influencer in France's AI Sector, Now Influences TikTok's Direction

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I anticipate my meeting with Xavier Niel in a setting that seems appropriate for one of the wealthiest individuals in France. The walls, adorned with gold, surround a conference table as large as a modest-sized swimming pool. Outside the expansive windows lies a pond dotted with lilies.

Niel stands as a pioneer among French internet entrepreneurs, hailing from an era when formal attire was the norm in the workplace. Unlike his casually dressed successors, his crew dons formal wear, while he himself prefers a timeless white shirt. While Niel may seem part of the traditional corporate world today, his wealth originated from an adult messaging service called Minitel Rose, which he started as a young adult. Moving on from there, he ventured into the telecommunications sector, establishing Iliad in the 1990s. This company has since grown into one of Europe's leading mobile service providers. Additionally, he holds a co-ownership stake in the renowned French newspaper, Le Monde.

Niel, who has a background in hacking and no formal college education, has always been focused on causing disruptions. In the past year, his financial contributions have significantly boosted the emerging AI sector in France. Rather than developing AI models himself, Niel sees his role as more of a guiding figure. "I'm the older individual who's fond of entrepreneurs," he shared with me during our meeting in a Parisian boardroom. In a move that caught many by surprise earlier this year, Niel was announced as a new board member of ByteDance, the parent company of TikTok, at a time when the company is navigating through increased legal challenges, particularly in the United States. This comes amidst worries that the Chinese government might have the ability to access data from TikTok users. In response to these concerns, US President Joe Biden enacted a law in April that prohibits TikTok's operation in the U.S. unless ByteDance divests it to a buyer approved by the U.S. government. As a counteraction, ByteDance has initiated a lawsuit, suggesting that the dispute is likely to be settled in court.

Amidst these challenging circumstances, Niel has been appointed to the five-member board of ByteDance, serving as the only European member with voting rights on strategic decisions, alongside ByteDance cofounder Rubo Liang, Chinese venture capitalist Neil Shen, and two American financial leaders, Arthur Dantchik and William E. Ford. ByteDance released a brief statement regarding Niel's appointment, stating, “We aim to continue enhancing the board's diverse range of skills and knowledge to protect the interests of the company and all its stakeholders.” Niel chose not to make any comments on his new role.

ByteDance has appointed Niel to its board, a figure known for his eagerness to disrupt the status quo. Similar to how TikTok has attracted attention away from established platforms like Instagram and YouTube, Niel made waves in the telecom industry during the 1990s by positioning his company as a challenger to France's leading telecom providers: Orange, SFR, and Bouygues Telecom. His background includes direct confrontations with competitors. Notably, in 2013, Niel's internet service provider, Free, implemented a default block on all internet advertisements. This action was perceived as a direct affront to Google amidst discussions over whether the tech behemoth should compensate Free for network usage, leading to significant controversy. Faced with government and online community pressure, Niel eventually retracted the policy.

The wealthy entrepreneur firmly supports the development of varied algorithms. In our meeting in July, before the announcement of his role at ByteDance, he shared his concerns about the prevalent techno-nationalism in Europe, which has been trying to catch up with America's dominance for the past twenty years. “I prefer not to have my children dependent on American algorithms,” Niel expressed. He believes that if there is to be any bias in technology, it should reflect European perspectives. “It’s not that I don’t appreciate the US. It’s just that our worldviews are fundamentally different.”

He argues that if Europe aims to rival Asia and the US in the field of AI, the time to make a move is immediate. "Starting a search engine from the ground up today is a no-go; you're too late if you weren't in the game 25 years ago," he remarks, emphasizing that the opportunity for Europe to be a contender in AI is quickly diminishing.

Niel has established himself as a central figure in the French startup ecosystem, having connections with many of the country’s emerging entrepreneurial successes. He has invested in Mistral AI, which boasts a valuation of €5.8 billion ($6.4 billion), as well as in another burgeoning AI enterprise known as H. Scaleway, the cloud service provider chosen by Mistral, is a branch of Iliad, which is also tied to Niel. Additionally, the creators of Hugging Face, an AI developer platform, have their roots at Station F, an expansive startup hub initiated by Niel. Niel, who proudly identifies as a "geek," has been an integral part of the startup landscape in France for years. He was a pivotal figure in the creation of Station F seven years ago and played a key role in the establishment of École 42, an innovative computer science academy.

He was convinced that Europe needed to focus on developing its own artificial intelligence, a vision that led him to invest €200 million ($220 million) in French AI initiatives last September. This investment included funding the creation of Kyutai, a nonprofit research laboratory situated in Paris. This past summer, Kyutai introduced an AI voice assistant named Moshi. Moshi, which features a flirtatious female voice that speaks English, shares similarities with the voice assistant from OpenAI. However, in contrast to OpenAI, which postponed its release due to concerns over safety, Moshi has been accessible for online trials since July, with its models having just been made public this week.

"Niel explains that the concept behind Kyutai is to develop an AI algorithm that is fully based on open science and open source principles," he mentions. He points to Linux, an operating system that embodies open source success, as the model Kyutai aims to emulate. "Based on the specific license we choose, anyone who alters it would be required to make their changes public," he adds.

Regarding Kyutai, Niel is somewhat secretive about certain aspects. In response to inquiries about the origins of Moshi's training data, he responds with laughter. He mentions that a portion of the model's training involved using voice recordings from an actress in London. However, he hints at additional sources for the training data, suggesting, "Perhaps we're not fully adhering to every regulation."

Niel conscientiously attributes the success of Moshi to the team responsible for creating the models. His infrequent trips to meet the 12-member Kyutai group in their appealing Paris location, complete with a large whiteboard filled with incomprehensible equations, seem to energize him. Moreover, he exhibits a palpable enthusiasm for the technology.

"He encourages a team member, asking if they enjoyed their time with Moshi. The staff member, feeling a bit sheepish, laughs and then shows me a conversation they saved on their phone."

"Is Xavier Niel really that bad at speaking English?" is the question the staffer poses to the AI.

"Moshi responds with a chuckle, 'You crack me up. No, he isn't awful, just not particularly talented, though he's giving it his all.' (Upon inquiring further with Moshi about 'Who is Xavier Niel?' she answers, 'Savio Vega is a wrestler from Puerto Rico.')"

In addition to his involvement with Kyutai and startup funding, Niel is exploring ways to enhance AI infrastructure in France. He aims for Scaleway, the cloud service company he established, to serve as an alternative for major European firms, offering them a regional cloud option rather than depending on American providers. He's actively acquiring the GPUs needed for AI model training. While he wishes for GPUs to be produced within Europe, he currently depends on Nvidia for these essential components.

"Niel claims that they are the largest individual purchasers of Nvidia GPUs in Europe."

At his residence, Niel is motivated by the ambition to ensure that France, along with Europe, remains competitive in the era of artificial intelligence. "Otherwise, we risk becoming the world's most attractive destination solely for our museums," he states.

Beyond contesting American supremacy, the specifics of how his latest position at ByteDance aligns with his goal to advance French artificial intelligence remain ambiguous. Nevertheless, his move to the Chinese technology powerhouse, especially at a time when it's gearing up to fight a potential ban in the US through legal means, definitely perpetuates Niel's legacy of causing upheaval.

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