NVIDIA Accused of Acting as "GPU Cartel" and Controlling Supply

[AleksandarK]

World's most important fuel of the AI frenzy, NVIDIA, is facing accusations of acting as a "GPU cartel" and controlling supply in the data center market, according to statements made by executives at rival chipmaker Groq and former AMD executive Scott Herkelman. In an interview with the Wall Street Journal, Groq CEO Jonathan Ross alleged that some of NVIDIA's data center customers are afraid to even meet with rival AI chipmakers out of fear that NVIDIA will retaliate by delaying shipments of already ordered GPUs. This is despite NVIDIA's claims that it is trying to allocate supply fairly during global shortages. "This happens more than you expect, NVIDIA does this with DC customers, OEMs, AIBs, press, and resellers. They learned from GPP to not put it into writing. They just don't ship after a customer has ordered. They are the GPU cartel, and they control all supply," said former Senior Vice President and General Manager at AMD Radeon, Scott Herkelman, in response to the accusations on X/Twitter.


The comments reference the NVIDIA GeForce Partner Program (GPP) from 2018, which was abandoned following backlash over its exclusivity requirements. Herkelman suggests NVIDIA has continued similar practices but avoided written agreements. The Wall Street Journal report also hinted that major tech companies like Microsoft, Google, and Amazon are developing their own AI accelerators but downplaying them as NVIDIA competitors. This further points to an environment where NVIDIA is seen as controlling access to key technology for AI development. NVIDIA currently powers around 80% of AI development worldwide, giving it incredible influence over strategic technology. The accusations from Groq and Herkelman suggest the company is willing to leverage that market position aggressively to protect its dominance. NVIDIA has not officially responded to the latest accusations. But the reports have fueled speculation about anticompetitive practices just as regulatory scrutiny grows over the market power of tech giants. NVIDIA will likely face pressure to transparently address whether its supply allocation favors some customers over others based on relationships with rival chipmakers.

View at TechPowerUp Main Site | Source

 

[btarunr]

GPP didn't go anywhere. The lack of an RX 7900 XTX ROG Strix, AORUS Xtreme, or SUPRIM X is sufficient proof of that.

 

[3valatzy]

GPP didn't go anywhere. The lack of an RX 7900 XTX ROG Strix, AORUS Xtreme, or SUPRIM X is sufficient proof of that.

AMD deserves what it gets. They can't put the graphics market as a ninth priority out of nine, badly underperform with most of the graphics solutions (exception is only Radeon RX 6000 series), and expect a welcome attitude from anyone, even the AMD loyaltists.

 

[HisDivineOrder]

Sounds like Nvidia to me.

 

[R-T-B]

AMD deserves what it gets. They can't put the graphics market as a ninth priority out of nine, badly underperform with most of the graphics solutions (exception is only Radeon RX 6000 series), and expect a welcome attitude from anyone, even the AMD loyaltists.

Someone missed a hell of a lot of other exceptions...

 

[Space Lynx]

AMD deserves what it gets. They can't put the graphics market as a ninth priority out of nine, badly underperform with most of the graphics solutions (exception is only Radeon RX 6000 series), and expect a welcome attitude from anyone, even the AMD loyaltists.

I have never understood this attitude, A) you don't even have access to the sales numbers for either company nor production number B) any review shows a 7900 XT (which I paid half the cost for in July of 2023) beating a 4070 ti SUPER and 4080 in majority of games in raster at 1080p and 1440p. True for 4k gaming you need Nvidia and DLSS, but not ever games that way.

Nvidia is imo going to do very well in the short term, but the AI market is going to saturate itself very fast imo. ARM, AMD, Intel, everyone is in fifth gear to make AI, and not everyone needs the best AI chips out there for their use case. Nvidia will probably crash hard stock wise at the end of 2025.

 

[3valatzy]

I have never understood this attitude, A) you don't even have access to the sales numbers for either company nor production number B) any review shows a 7900 XT (which I paid half the cost for in July of 2023) beating a 4070 ti SUPER and 4080 in majority of games in raster at 1080p and 1440p. True for 4k gaming you need Nvidia and DLSS, but not ever games that way.

I don't like a few things:
1. Nvidia competes with much smaller chips. AD104 measures around 294 mm2 and yet in manages to perform the same as the Navi 31 529 mm2 in Radeon RX 7900 GRE.
Can you imagine how much the larger chip increases the cost and decreases the profit margin?
I assure you want to be an Nvidia shareholder, no an AMD shareholder.

NVIDIA GeForce RTX 4070 SUPER Specs

NVIDIA AD104, 2475 MHz, 7168 Cores, 224 TMUs, 80 ROPs, 12288 MB GDDR6X, 1313 MHz, 192 bit

www.techpowerup.com

2. AMD always leaves imperfections with their implementations - high power consumption (media playback, idle, power spikes, etc.), and lower than usual performance in certain games (Counter-Strike 2 as a prime case), and lack of interest to put more efforts in the ray-tracing development where it lags a few years behind Nvidia's solution.
3. Always skipping the largest chips. Radeon RX 5700 XT, Radeon RX 8700 XT, Radeon Vega 64, to name a few.

Nvidia is imo going to do very well in the short term, but the AI market is going to saturate itself very fast imo. ARM, AMD, Intel, everyone is in fifth gear to make AI, and not everyone needs the best AI chips out there for their use case. Nvidia will probably crash hard stock wise at the end of 2025.

We shall see.

 

[Recus]

No name company cries nobody buying their stuff. They even don't make GPUs they are making Language Processing Unit (LPU).

And Scott Herkelman is pathological liar.

GPP didn't go anywhere. The lack of an RX 7900 XTX ROG Strix, AORUS Xtreme, or SUPRIM X is sufficient proof of that.

I pay ROG taxes if it has AMD logo.

Sounds like Nvidia to me.

AMD is 'undershipping' chips to balance CPU, GPU supply

AMD joins Nvidia in "undershipping" chips to balance supply and keep prices higher.

www.pcworld.com

AMD Tightly Regulating Prices of Successful Radeon RX 6750 GRE in China

The AMD Radeon RX 6750 GRE (Golden Rabbit Edition) is a runaway success in China, where the card is found selling in volumes comparable to GeForce RTX 4060 Ti, and the likes. This is thanks to its aggressive pricing, and decent levels of performance given the maturity of drivers for the older...

www.techpowerup.com

 

[user556]

M$ and Intel sure won't speak up here. "Cartel" is Standard-Operating-Procedure for them.

 

[watzupken]

The behavior is not unexpected. Take the below article as example. While Asrock did not explicitly mention that it is difficult to work with Nvidia such that they can also produce Nvidia GPUs, but it is implied. In another example, for companies producing both AMD and Nvidia cards, notice that AMD cards are never given the high end treatment, i.e. Asus TUF is the top tier AMD GPU model. The same can be observed with MSI and Gigabyte. The likes of the big 3 here are established brands which I believe Nvidia have to make an exception to allow them to also produce competitors' products but to make them less desirable.

ASRock does not rule out making NVIDIA cards but describes it as 'challenging' at present - VideoCardz.com

For now, there appears to be no plan for ASRock GeForce GPUs In an interview with QuasarZone and other Korean media, ASRock representative touched upon an interesting topic. ASRock is currently manufacturing AMD and Intel graphics cards. The company is working with both companies in designing...

videocardz.com

After all, Nvidia is widely supported and hardly anyone pushes back on their anti-competitive practices. Now in a dominant AI GPU producer position, no companies or nations will want to end up in their bad book. Mark of a true monopoly. So is this news surprising? Hardly. But Nvidia supports will continue to blindly support them to no benefit or even detrimental for them.

M$ and Intel sure won't speak up here. "Cartel" is Standard-Operating-Procedure for them.

To be honest, whenever a company grows too big, it is unavoidable for them to operate in an anti-competitive way to fend off competitors. That is the unfortunate fact. Take Intel for example, it is clear they are likely still at it with the anti-competitive practice. If you just look across laptops for example, notice that most premium laptops are exclusive to Intel chips only? AMD processors rarely get the "red carpet" treatment and even if the same model exists, the specs may also be inferior to the Intel version. One can argue that AMD may not be able to supply that many chips as compared to Intel, but I do wonder if high end laptops really sell like hot cakes.

 

[Dave65]

AMD deserves what it gets. They can't put the graphics market as a ninth priority out of nine, badly underperform with most of the graphics solutions (exception is only Radeon RX 6000 series), and expect a welcome attitude from anyone, even the AMD loyaltists.

Try harder.

 

[ExcuseMeWtf]

Also sky accused of being blue.

 

[TheDeeGee]

Oh QQ, why is everyone buying the more feature rich NVIDIA products ?

 

[remekra]

Nvidia doing Nvidia things, oh the shock.

 

[zo0lykas]

I don't like a few things:
1. Nvidia competes with much smaller chips. AD104 measures around 294 mm2 and yet in manages to perform the same as the Navi 31 529 mm2 in Radeon RX 7900 GRE.
Can you imagine how much the larger chip increases the cost and decreases the profit margin?
I assure you want to be an Nvidia shareholder, no an AMD shareholder.

View attachment 336764

NVIDIA GeForce RTX 4070 SUPER Specs

NVIDIA AD104, 2475 MHz, 7168 Cores, 224 TMUs, 80 ROPs, 12288 MB GDDR6X, 1313 MHz, 192 bit

www.techpowerup.com

2. AMD always leaves imperfections with their implementations - high power consumption (media playback, idle, power spikes, etc.), and lower than usual performance in certain games (Counter-Strike 2 as a prime case), and lack of interest to put more efforts in the ray-tracing development where it lags a few years behind Nvidia's solution.
3. Always skipping the largest chips. Radeon RX 5700 XT, Radeon RX 8700 XT, Radeon Vega 64, to name a few.



We shall see.

Please don't talk i cant read your nonsense, you srsly live in the cave..

 

[bug]

And you thought it was a good idea to post this less than a day after the article claiming customers are looking to sell off excess Nvidia GPUs.
It's all good, kids these days won't put two and two together.

 

[NC37]

Nvidia doing Nvidia things, oh the shock.

Exactly this. Not even worth a bag of popcorn to watch the chaos. Just the same old routine every few years. Same with the DRAM industry and their never ending price fixing. Still remember my cut from the last class action.

They get in trouble, get a slap on the wrist, nothing really changes and the slap is absorbed pretty much instantly.

 

[Bwaze]

"World's most important fuel of the AI frenzy, NVIDIA, is being applauded by its shareholders for acting as a "GPU cartel" and controlling supply in the data center market."

There, I fixed it. It's not really news.

 

[nguyen]

Scott Herkelman can cry a lot more and no one cares LOL.

The little guys being intimidated by Nvidia here are conglomerates themselves who use the same tactic on a daily basis

 

[ilyon]

I disagree: the other companies don't offer RTX™ and DLSS™ for free.
NVIDIA maybe is a cartel, but an honest one.

 

[Outback Bronze]

NVIDIA maybe is a cartel, but an honest one.

Hmm, GTX 970 with 4GB vram anybody?

 

[KLMR]

Noooo waaaayyy

 

[Chomiq]

Meanwhile at Micron, Hynix and Samsung:

 

[Kenjiro]

I disagree: the other companies don't offer RTX™ and DLSS™ for free.
NVIDIA maybe is a cartel, but an honest one.

Are You serious? For free? Which of NVidia's graphics card did you get free? You pay in product, it is simple as that.

 

[ExcuseMeWtf]

Hmm, GTX 970 with 4GB vram anybody?

And "we unlaunched RTX 4080 12GB because name would be confusing"