European Union Launches Investigation into Nvidia’s Dominance in AI Semiconductor Market

European Union Initiates Investigation into Nvidia’s Dominance in AI Semiconductor Market

In a recent development, the European Union (EU) has launched an investigation into potential anti-competitive abuses within the artificial intelligence (AI) semiconductor market, according to Bloomberg News. With a specific focus on the graphics processing unit (GPU) sector, the EU aims to assess if market intervention is necessary. As AI-powered services such as ChatGPT gain popularity, the demand for GPU, a chip optimized for AI calculations, is rapidly increasing. Notably, US-based Nvidia currently dominates the GPU market, capturing approximately 80% of the sector’s share.

The EU investigation comes in the wake of individual countries expressing concerns over Nvidia’s market position. The French government, for instance, has been actively soliciting industry opinions on various aspects related to Nvidia’s presence in the AI market, including pricing policies, semiconductor supply shortages, and their subsequent impact. In a recent raid on Nvidia’s offices, French authorities investigated allegations of the company engaging in anti-competitive practices in the GPU market, as reported by The Wall Street Journal (WSJ).

However, it is important to note that the EU investigation is currently in its early stages, making it uncertain if it will progress into a formal investigation or result in any fines being imposed. Should Nvidia be found guilty of violating antitrust laws by the EU, the company could potentially face fines up to 10% of its annual sales, as per Bloomberg News.

FILE PHOTO: The Nvidia Corporation logo is seen during the annual Computex computer show in Taipei, Taiwan May 30, 2017. REUTERS/Tyrone Siu/File Photo

Bloomberg News reported on the 29th (local time) that the European Union (EU) has begun an investigation into anti-competitive abuse in the artificial intelligence (AI) semiconductor market.

Bloomberg News reported that the EU has recently been gathering informal opinions on potential abuses in the graphics processing unit (GPU) sector to gauge the need for market intervention. A GPU is a semiconductor chip optimized for AI calculations, and the demand is increasing rapidly as AI services like ChatGPT become popular. In the GPU market, NVIDIA from the United States is consolidating its dominance, occupying around 80%.

According to Bloomberg, each country decided that it was necessary to take a closer look at Nvidia’s leading position in the market. The French government has been gathering industry opinion on NVIDIA’s position in the AI ​​market, pricing policy, semiconductor supply shortages, and the resulting impact. The Wall Street Journal (WSJ) reported that French authorities raided Nvidia’s offices on the 26th on suspicion of engaging in anti-competitive practices in the GPU market.

However, Bloomberg News explains that the EU investigation is only in its early stages, so it is unclear whether it will lead to a formal investigation or the imposition of fines. If the EU investigation determines that Nvidia has broken antitrust laws, the company could be fined up to 10% of its annual sales.

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