The U.S. Department of Justice is reportedly intensifying its antitrust investigation into Nvidia, moving from preliminary inquiries with competitors to issuing subpoenas for evidence, Bloomberg reports. The focus of the investigation appears to be on whether Nvidia abuses its dominant position in the AI computing market.
When the investigation was first disclosed in June, Fast Company noted that Nvidia controls an estimated 90% of the market for AI-capable chips. While initial reports barely impacted Nvidia’s stock, the company’s shares recently dropped by a record $279 billion following the latest developments.
Concerns raised include Nvidia’s potential preferential treatment for customers who exclusively use its technology and its acquisition of RunAI, which might force RunAI customers to rely solely on Nvidia chips, according to Bloomberg sources. Nvidia, however, defends its business practices as merit-based, emphasizing its contributions to AI development.
Despite the stock slump, Nvidia’s market dominance is not expected to diminish soon. An SEC filing highlighted Nvidia’s expansive ecosystem, including 5 million developers and 40,000 companies.
The DOJ’s action follows its success in proving Google’s search monopoly, signaling its intent to preempt monopolistic behavior in the AI sector. DOJ antitrust chief Jonathan Kanter stated in June that the department is scrutinizing all aspects of the AI supply chain, including computing power, data, and essential hardware like GPUs. Kanter further stressed the importance of timely interventions to prevent monopolistic choke points in the rapidly growing AI industry, as reported by the Financial Times.
More information can be found in the original Ars Technica report.