The EU is investigating the GPU market for possible abuses after a raid on Nvidia offices
October 2, 2023

The EU is investigating the GPU market for possible abuses after a raid on Nvidia offices

The European Commission has informally started collecting opinions on potential unfair practices related to graphics cards used for artificial intelligence (AI) applications. In this way, the EU is investigating whether there is a need for the next step, that is, a formal investigation when it comes to the GPU market.

The move came after French law enforcement authorities raided Nvidia's offices last week on suspicion of so-called anti-competitive practices in the graphics card industry, Bloomberg reports.

Nvidia GPUs have become essential for training large-scale AI models, and the Nvidia H100 graphics processor has allowed the company to secure over 80 percent of the market, beating competitors such as Intel and AMD. If these initial investigations culminate in a formal EU antitrust investigation and Nvidia is eventually found guilty, the company could face serious fines of up to 10 percent of its global annual revenue.

In the case of Nvidia, that amount would be measured in the billions of dollars.

Meanwhile, France is conducting a parallel investigation after last week's raid as the country's authorities have taken a particular interest in understanding Nvidia's dominant role and its pricing strategy. The fact that the EU investigation was announced immediately afterwards is a fact that underlines the seriousness of the situation in which Nvidia currently finds itself.

It is definite that Nvidia is breaking records when it comes to AI GPUs and is reaching huge amounts of pure profit at breakneck speed. However, this was only to be expected since the company initially invested billions of dollars in optimizing its CUDA platform for AI applications. That, together with the performance of the A100 and H100 processors, not only solidified Nvidia's position in the AI ​​world, but pushed it far ahead of its rivals.

The dominant market position is certainly a testament to Nvidia's innovation and capabilities, but it doesn't seem to sit well with everyone, and it's now under the microscope for potential antitrust implications. If things end badly for this company, it would be just another contribution to the thesis that the capitalist free market is not so free.