Nvidia Likely To Get Charged By French Antitrust Regulator — Details

In a recent report on competition in generative AI, the French watchdog highlighted concerns about potential abuse by chip suppliers such as Nvidia.

Nvidia is most probably going to get charged by the French antitrust regulator for its alleged anti-competitive practices. According to a report by Reuters, people close to the matter have said that this makes the regulator the first enforcer to act against the computer chip maker. The statement of objections or the charge sheet would follow dawn raids in the graphics cards sector in September 2023, which as per sources targeted Nvidia. The raids were an outcome of a broader inquiry into cloud computing.

The world's biggest maker of chips that are used for both artificial intelligence and for computer graphics has seen a rise in interest in its chips jump after the launch of the generative AI application ChatGPT. This has also triggered regulatory scrutiny on both sides of the Atlantic.

Interest In Nvidia Chips Increasing

The French regulatory body, which selectively discloses its objections to companies, and Nvidia both declined to provide comments, Reuters reported. Nvidia disclosed in a regulatory filing last year that authorities in the European Union, China, and France had requested information regarding its graphics cards. Sources familiar with the situation indicated that the European Commission is unlikely to expand its preliminary review at this time, as the French authority conducts its own investigation into Nvidia.

In a recent report on competition in generative AI, the French watchdog highlighted concerns about potential abuse by chip suppliers. It specifically raised issues regarding the industry's reliance on Nvidia's CUDA chip programming software, which is the only system fully compatible with GPUs crucial for accelerated computing. The watchdog also expressed unease over Nvidia's recent investments in AI-focused cloud service providers like CoreWeave.

Violating French antitrust regulations could result in fines of up to 10 per cent of a company's global annual turnover, although companies may offer concessions to avoid penalties. Meanwhile, according to a source briefed on the matter, the US Department of Justice is leading the investigation into Nvidia, alongside the Federal Trade Commission, as part of broader scrutiny of major technology firms.