US Department of Justice investigates Nvidia for alleged abuse of market power

The U.S. Department of Justice has launched an investigation into Nvidia to examine allegations of market power abuse in AI chips.

8/6/2024, 8:00 AM
Eulerpool News Aug 6, 2024, 8:00 AM

The U.S. Department of Justice has launched an investigation into Nvidia, according to a media report.

Sure, here's the translated heading in English:

"Nvidia did not directly address the allegations but emphasized its willingness to provide all requested information to the authorities. 'We compete based on decades of investment and innovation, and we conscientiously adhere to all laws,' the company stated. The U.S. Department of Justice initially declined to comment. Following the news of the investigation, Nvidia's shares fell by nearly three percent in pre-market trading on Wall Street.

Nvidia dominates the global market for high-performance processors for artificial intelligence (AI) with a share of 80 percent. Competitors like AMD or startups like Cerebras are attempting to break this dominance. Big technology companies like Amazon, Google (a subsidiary of Alphabet), and Meta (the parent company of Facebook) are also working on their own AI processors. However, Nvidia has built an extensive software ecosystem in recent years that binds developers to its platform. The CUDA software package makes it easier for developers to write applications for Nvidia processors.

In France, Nvidia also faces proceedings for anti-competitive behavior due to similar allegations. French authorities searched the company's business premises last year. The dominance of Nvidia in AI processors and the role of CUDA are being closely scrutinized here as well. According to insiders, the EU antitrust watchdogs do not plan to expand their investigations for the time being due to the ongoing investigations in France.

The current investigations in the USA and France cast a spotlight on Nvidia's aggressive market strategy and could lead to significant legal and financial consequences for the company.

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