French Authorities Target NVIDIA’s Offices Over Anti-Competitive Practices

Allegations Against NVIDIA

NVIDIA is a semi-conductor chip manufacturing giant in the world. However, French regulators recently raided the headquarters of the firm situated in Nice and Paris. Regulators have charged the company with allegations of anti-competitive practices.

The enterprise designs and creates Graphics cards and it is currently subjected to regulatory scrutiny of the French authorities. On this account, the law enforcement agents of the agency cracked down two offices of the firm with seizure charges.

The Competition Authority of France has put the firm on the antitrust list.  It is expected that the regulators are going to put the firm on trial for participating in anti-competitive practices within the graphics card development industry.

Local media outlets reported that the firm was identified as NVIDIA revealing that the operation was sanctioned by the liberty and detention judge or JLD. On this account, the regulators are currently working on collecting evidence for perpetration of anti-competitive activities practices carried out by the chip-manufacturer.

NVIDIA’s AI Models

NVIDIA is one of the two top GPU manufacturing companies in the sector second only to Taiwan-based TSMC. The firm is known for introducing latest chip manufacturing technologies such as DLSS.

Furthermore, the firm is also offering cloud sectors and selling server GPUs. The semiconductor industry is known to power the AI industry around the globe.

At the same time, the products like GeForce are also used by cloud gaming projects. The company has drawn a service contract with Microsoft for GPUs designed for Xbox. The French authorities have retained the agency have not brought formal charges against the firm for alleged monopoly enforcement.

The action from the regulators has resulted to a detailed probe into the inner workings of cloud services companies. The Competition Authority has added its findings from cloud sector in its investigative reports.

Benoit Coeure, president of the antitrust watchdog, claimed that firms like Google, Microsoft, and Amazon can hinder the development of competitive firms within the sector. In 2021, 3 big named brands captured 80% of the cloud services market share in France.

She added that the sector offered services in the cloud computing sectors extended to infrastructure development and application support.

French Authorities Highlight Entry Barriers for Cloud Services Startups

The Competition Authority further retained that startups in the cloud services sector face challenges such as shifting between services providers, setting up an independent service cost, and entry barriers. With the increase in the AI sector, NVIDIA revenues also skyrocketed at the same pace.

The company retained in its latest revenue reports that it amassed $13.51 billion during the second quarter of financial year of 2023. This accounts more than 100% income increment in comparison to last year. The current valuation of the firm stands at $1 trillion in May this year.

A recent report regarding stock market insights into the chip manufacturing industry has revealed that September remained a negative month for the sector. However, the report noted that Intel Corporation (INTC) was among the firms that managed to outperform its contemporaries at Wall Street.

Intel also has a strong presence in the data management and AI sectors. Two other companies that reported a positive return in comparison to NVIDIA are Taiwanese-based TSM and AMD in terms of stock performance.