EU examines Nvidia’s dominance in AI chip used for AI

The European Union is examining alleged anticompetitive practices in chips used for artificial intelligence. The European Commission is examining the AI chip market for alleged abuses by Nvidia, the dominant player in the market.

The investigation is focused on whether Nvidia is using its dominance to stifle competition and innovation in the market. The European Commission is concerned that Nvidia's dominance in the AI chip market is giving it too much power over its customers and competitors.

The Commission is also concerned that Nvidia is using its dominance to make it difficult for other companies to enter the market. The report further says, the European Commission has been informally collecting views on potentially abusive practices in the sector for graphics processing units (GPU), used for AI work as well for gaming, to understand if there's need for future intervention.

Nvidia, which has a near-monopoly on the GPU market with its 80% market share, declined to comment, while the European Commission did not immediately respond to a Reuters’ request for comment.

The investigation is still in its early stages, and it is too early to say what the outcome will be. However, the investigation is a sign that the European Commission is taking a closer look at the AI chip market and is concerned about the potential for abuse of dominance.

If the European Commission finds that Nvidia has abused its dominance in the AI chip market, it could take a number of actions, including:

Ordering Nvidia to stop the abusive practices.

Fining Nvidia.

Forced Nvidia to divest some of its assets.

The outcome of the investigation could have a significant impact on the AI chip market. If Nvidia is found to have abused its dominance, it could open up the market to more competition and could lead to lower prices for AI chips.