The U.S. Department of Justice (DOJ) has initiated two separate antitrust investigations into Nvidia, the leading GPU and AI technology giant, to assess whether the company has misused its market dominance. The DOJ’s scrutiny comes amid allegations that Nvidia may have engaged in anti-competitive practices by bundling products and penalizing customers who purchase competing chips.
Reports indicate that Nvidia may have offered lower prices for its GPUs when customers also bought additional Nvidia products, such as cables. While bundling is not inherently illegal, it can become problematic if it uses a dominant product to disadvantage competitors. Some sources claim that Nvidia has limited the availability of its chips unless customers also purchased other Nvidia products, potentially imposing higher prices or restricting shipments to those using rival chips from companies like AMD or Intel.
Microsoft, one of Nvidia’s major clients, reportedly expressed concerns that choosing not to buy Nvidia’s networking cables might lead to slower delivery of its highly sought-after GPUs.
Nvidia has denied any anti-competitive practices. Mylene Mangalindan stated, “We compete based on decades of investment and innovation, scrupulously adhering to all laws, making Nvidia openly available in every cloud and…for every enterprise, and ensuring that customers can choose whatever solution is best for them. We… are happy to provide any information regulators need.”
“Nvidia wins on merit, as reflected in our benchmark results and value to customers,” Mangalindan asserted.
The DOJ is also examining Nvidia’s $700 million acquisition of the Israeli startup Run: ai, completed in April. Run: AI specializes in managing and optimizing distributed AI deployments through an open platform based on Kubernetes, which could potentially affect how Nvidia’s products interact with those of its competitors. The DOJ is investigating whether Run: ai will continue to support non-Nvidia GPUs and has also inquired about Nvidia’s 2022 acquisition of Bright Computing, a software firm.
Nvidia is also facing scrutiny outside the US. French officials raided Nvidia’s offices last year and are believed to be bringing anti-competition charges against the company, while the UK and the European Union are also investigating broader AI competition risks.
