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The government can strong arm enterprises in a million ways. If they just issue a vague executive order large public companies won't want to buy inference from these models without regulatory certainty. Anyone in regulated industries is going to be weary of regulatory retaliation.

I.e. for Google to build data centers they need the US gov to play ball, so if they were considering a service of hosting open source models on their TPUs they wouldn't do this. Another example is the merger between Paramount and Skydance where they paid out Trump to get the merger approved [1].

[1]. https://www.yahoo.com/news/paramount-settles-donald-trump-la...

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The US is trying to stop them for US companies, it doesn't care about non Americans.
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The parent comment, emphasis mine.

> Anyone in Europe can download and run a Chinese model and serve it up on the open internet to people in the US.

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Sure, but if you are a business in the US, you might not be able to use it legally.

And, through the US exercising extraterritorial jurisdiction, businesses in Europe doing business with the US might not be able to use it either, for fear of reprisals. Even though the model is Chinese and hosted in Europe.

This sort of thing happens all the time, especially in the finance and defence sectors.

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