PYMNTS MonitorEdge May 2024

Report: Nvidia Target of French Antitrust Charges

Chipmaker Nvidia is reportedly about to be charged with antitrust violations in France.

The French competition authority’s pending charges would follow a raid on Nvidia’s offices last year, Reuters reported Monday (July 1), citing sources familiar with the matter.

Nvidia has seen its fortunes bloom in recent months thanks to demand for its chips, used for artificial intelligence (AI) applications. But as Reuters noted, that has triggered scrutiny from regulators around the world.

A Nvidia spokesperson declined to comment when reached by PYMNTS.

The company, the Reuters report said, disclosed in a 2023 regulatory filing that the European Union, China and France had sought information on its graphic cards.

Sources tell Reuters that the European Commission is unlikely to expand its review for now, as the French authority is looking into Nvidia. France’s watchdog issued a report last week on competition in the generative AI field and cited the risk of abuse by chip companies.

That report, Reuters said, included concerns regarding the sector’s dependence on Nvidia’s CUDA chip programming software, the only system that is totally compatible with the GPUs that have become crucial for accelerated computing.

Last year’s raid was part of a broader investigation into the cloud computing industry. Nvidia has also faced scrutiny in Europe over its proposed acquisition of British chip designer Arm.

As noted here recently, Nvidia has been in close competition with Microsoft and Apple for the title of the world’s most valuable company. Those companies, like Nvidia, have seen their market capitalization rise amid the wave of investor interest that has led to an AI boom.

Last week, the company held a shareholder meeting in which CEO Jensen Huang said Nvidia has taken several steps to maintain its dominant position in the field of AI.

Huang told investors the firm has already “transformed” from a gaming-focused company to a data center-focused one.

He added that Nvidia is working with computer makers and cloud providers to create new markets for its AI; and is offering chips whose performance and operating costs make them a better value than others that may be cheaper to purchase.

Beyond that, Huang said Nvidia has achieved a “virtuous circle” in which the number of customers it has allows it to build products that draw in even more customers.

“The Nvidia platform is broadly available through every major cloud provider and computer maker, creating a large and attractive install base for developers and customers, which makes our platform more valuable to our customers,” Huang said.

His comments were reported by CNBC, which noted that Nvidia has a market share of greater than 80% in AI chips.

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