Nvidia's French offices raided by antitrust authorities following suspicion of 'anticompetitive practices'

Nvidia’s French offices raided by antitrust authorities following suspicion of ‘anticompetitive practices’

Time Stamp: September 29, 2023 6:35 AM

If you’re in the business of creating large language models you might already think Nvidia’s pricing for its H100 super-duper data center GPU, which sells for upwards of $30,000 a pop, is criminally expensive. Now Nvidia’s broader cloud computing operations in France are under actual legal investigation.

The Wall Street Journal reports that Nvidia’s French offices were raided on Tuesday morning by the local competition authority, known as the Autorité de la concurrence.

The French authority didn’t identify Nvidia by name, only stating that a company in “the graphics card sector” was under investigation and that the operation is part of a broader inquiry into the cloud-computing sector involving concerns that dominant cloud-computing companies may be excluding smaller competitors.

However, the Wall Street Journal says that Nvidia was indeed the target of the investigation and is thus far declining to comment. It’s worth noting that the official statement from the Autorité de la concurrence is somewhat contradictory.

On the one hand it says, the company involved is “suspected of having implemented anticompetitive practices”. On the other it also states that, “such dawn raids do not pre-suppose the existence of a breach of the law.”

Whatever, what is certain is that Nvidia has the market cornered currently when it comes to producing GPUs optimized for AI and specifically large language models such as ChatGPT with its 80-billion transistor H100 “Hopper” chip.

Such has been Nvidia’s success in the sector of late, the company’s market valuation has rocketed to beyond $1 trillion.

France’s competition authority has a reputation for being, shall we say, rather enthusiastic about ensuring a level playing field. So, even if Nvidia is found to have breached local laws in France, it doesn’t necessarily follow that other countries and authorities will take the same view.

But it will certainly be interesting to see how this all develops and if Nvidia’s AI operations come under greater scrutiny. Given that Citi Bank reckons that Nvidia will maintain 90% market share for AI-accelerating GPUs for at least the next three years and the market will be worth $150 billion by 2027, it’s not hard to see why Nvidia’s success is drawing the attention of government authorities.

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