BREAKING: Justice Department Launches Investigation into Nvidia
DOJ Probes Pressure on Cloud Companies, AI Chip Dominance
Aug. 1, 2024
The U.S. Department of Justice (DOJ) has launched an investigation into Nvidia following complaints from competitors alleging unfair business practices. According to Reuters, the investigation will examine whether Nvidia has abused its dominant position in the artificial intelligence (AI) chip market.
Specifically, investigators will probe allegations that Nvidia has pressured cloud companies to purchase its chips exclusively. The company may also be under scrutiny for using its power in the AI chip space to stifle competition.
The news sent Nvidia's shares plummeting around 36% in premarket trading on Friday. The DOJ investigation comes amid a broader push by regulators to crack down on big tech companies. The department is currently investigating other major players in the industry, including Google, Amazon, and Meta.
The Nvidia investigation is separate but related to another DOJ probe into the company's $40 billion acquisition of Arm. Both investigations highlight the growing concern among regulators about the concentration of power in the tech sector.
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