Nvidia to be scrutinized by Department of Justice's antitrust investigation 🤔

Aug 01, 2024 7:18 PM

According to what Politico reported on Thursday night, NVIDIA (NASDAQ: NVDA) is being investigated by the US Department of Justice about the possibility of violating the Antimonopoly Act related to the acquisition plan of the startup company Run I.
NVIDIA announced plans to acquire Lanai, which is based in Israel, in April. Run Eye increases the efficiency of AI chips by making it possible to execute multiple workloads in parallel, and reduces the number of GPUs required to complete tasks.
Politico quoted 5 anonymous sources directly aware of this situation, and since NVIDIA occupies 90% of the high-end AI chip market, the Ministry of Justice is also investigating NVIDIA's business practices. Apparently there is a possibility that NVIDIA has too much power in the AI stack, and it seems that they are urging investigations by antitrust law regulators.
NVIDIA said it will provide all information required by regulators.
“We will continue to support aspiring innovators in every industry and market, and we're happy to provide whatever information regulators need,” an Nvidia spokesperson told Seeking Alpha.
“NVIDIA is winning in terms of ability, as reflected in benchmark results and value to customers,” the spokesperson added. “We're competing based on decades of investment and innovation, strictly complying with all laws, making NVIDIA publicly available for any enterprise on any cloud and on premise, and empowering customers to choose the solutions that work best for them.”
Last week, Calcalist reported that Nvidia's $0.7 billion acquisition of Run:ai has been delayed due to lengthy regulatory reviews.
In the same month, Nvidia announced plans to acquire Run:ai, and also proceeded with the acquisition of Deci, another Israeli startup that modifies AI models so that they can run more efficiently.
On July 23, the Federal Trade Commission issued a joint statement with the Department of Justice, the Antitrust Office, and European regulators regarding competition in generative AI infrastructure models and products.
The FTC said in a statement that “the four antitrust law enforcement agencies pledged in a joint statement to remain alert to potential competition issues and expressed their determination to use available powers to prevent tactics that damage fair competition or lead to unfair or deceptive conduct in the AI ecosystem.”