NVIDIA Under Antitrust Investigation in China Amid Escalating Chip Tensions
Today China announced an investigation into NVIDIA for possible violations of antitrust laws. This is apparently in retaliation for the recent U.S. embargo on semiconductor exports, Reuters reported. China's State Administration for Market Regulatory Affairs (SAMR) did not provide specific details about the antitrust violations however it said they may allegedly be linked to NVIDIA's acquisition of Mellanox Technologies in 2020. NVIDIA once dominated China's AI market with over 90% of the market share, however, it now generates just 17% of its revenue from the region, down from 26% two years ago. The decline in income is a direct result of U.S. export controls as NVIDIA was forced to develop Chinese-specific chip versions.
The investigation on NVIDIA mirrors China's 2013 antitrust probe against Qualcomm's local subsidiary for overcharging and abusing market position in wireless communication standards. The investigation resulted in a $975 million fine which Qualcomm agreed to pay. Recently, the United States announced additional export restrictions adding 140 Chinese companies from the semiconductor industry including chip equipment manufacturers. Shortly after, China announced a ban on exports of key minerals (gallium, germanium, and antimony) while Chinese industry associations urged domestic companies to avoid U.S.-made chips.
The investigation on NVIDIA mirrors China's 2013 antitrust probe against Qualcomm's local subsidiary for overcharging and abusing market position in wireless communication standards. The investigation resulted in a $975 million fine which Qualcomm agreed to pay. Recently, the United States announced additional export restrictions adding 140 Chinese companies from the semiconductor industry including chip equipment manufacturers. Shortly after, China announced a ban on exports of key minerals (gallium, germanium, and antimony) while Chinese industry associations urged domestic companies to avoid U.S.-made chips.