🛡️ Microsoft’s China Risk, Pentagon AI Deals, Apple-Nvidia Link

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🛡️ Microsoft’s China Risk, Pentagon AI Deals, Apple-Nvidia Link

Plus: Google Gains on AWS as Uber Drives into Robotaxis

Jose Montes de Oca

Jul 15, 2025

Transcript

Good morning. It’s Tuesday, Jul 15. Today we are covering:

A Little-Known Microsoft Program Could Expose the Defense Department to Chinese Hackers
US defense department awards contracts to Google, Musk's xAI
Apple Silicon machine learning code may become more easily portable to Nvidia hardware
Google Finds a Crack in Amazon's Cloud Dominance
Uber Taps China's Baidu for Robotaxis in Asia, Middle East

Let’s dive in

A Little-Known Microsoft Program Could Expose the Defense Department to Chinese Hackers

By Renee Dudley via ProPublica

Microsoft employs engineers in China to help maintain Defense Department cloud systems, relying on minimally trained U.S.-based “digital escorts” to input foreign engineers’ commands—creating a serious national security vulnerability.
Despite internal and external warnings that the escort model is easily exploitable and hard to supervise, Microsoft continued expanding it, prioritizing cost savings and scalability over cybersecurity.
Officials across the Pentagon, FedRAMP, and cybersecurity agencies were unaware of the system’s scope, while experts say it offers a clear opportunity for Chinese espionage, especially amid rising geopolitical tensions.

𝕏: Stunning @ProPublica investigation: Microsoft uses Chinese engineers to maintain Pentagon systems without much of a check in place "Digital escorts" -- ex-military with little coding experience -- are supposed to guard against spying. But they can't keep up with foreign engineers' advanced skills. All those leaks and cyberattacks on military capabilities should be no surprise. (Not to mention the awkwardness of choosing the spicy term "digital escorts" to describe cyberwarriors.) - Geoffrey Cain (@geoffrey_cain)

US defense department awards contracts to Google, Musk's xAI

Reuters

The U.S. Department of Defense has awarded contracts worth up to $200 million each to Google, OpenAI, Anthropic, and Elon Musk’s xAI to expand the use of advanced AI in national security.
The initiative supports the development of agentic AI workflows, with xAI unveiling its "Grok for Government" suite—including Grok 4—for use across federal and security agencies.
The contracts reflect growing U.S. government investment in AI, amid regulatory rollbacks by President Trump and calls from lawmakers like Sen. Elizabeth Warren for more competitive AI procurement.

𝕏: So the department of defense allegedly is about to start using a Chatbot that recently declared itself Hitler - Andrew Kaczynski (@KFILE)

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Apple Silicon machine learning code may become more easily portable to Nvidia hardware

By Malcolm Owen via AppleInsider

A new effort is underway to enable Apple’s open-source MLX framework to export machine learning code for execution on Nvidia CUDA hardware, potentially lowering development costs by using Apple Silicon Macs for prototyping.
The project, which is sponsored by Apple but still in early development, aims to let developers test ML code locally on Macs and deploy it to high-performance Nvidia GPU servers, though it does not support running CUDA on Macs directly.
Despite Apple's historically rocky relationship with Nvidia, the two have shown signs of collaboration in machine learning research, including a December project that successfully ported Apple's ReDrafter LLM optimization to Nvidia GPUs.

Google Finds a Crack in Amazon's Cloud Dominance

By Kevin McLaughlin via The Information

Google Cloud has made significant inroads into Amazon Web Services' (AWS) market share, highlighting a potential shift in the competitive dynamics of the cloud computing industry.
New strategic wins and increased enterprise adoption are giving Google traction in a space long dominated by AWS, especially among customers seeking multi-cloud flexibility.
The report underscores how Google’s investments in AI, custom chips, and open-source tools are resonating with enterprise buyers looking for alternatives to Amazon’s ecosystem.

Uber Taps China's Baidu for Robotaxis in Asia, Middle East

By Natalie Lung via Bloomberg

Uber and Baidu have entered a multiyear partnership to deploy robotaxis in markets outside the US and mainland China, starting with Asia and the Middle East later this year.
Baidu’s autonomous vehicles will be integrated directly into the Uber app, with plans to roll out thousands of units across multiple regions.
Future expansion of the robotaxi service is expected to include Europe and Oceania, signaling Uber’s broader global ambitions in autonomous mobility.

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