NVIDIA Faces Raids In France: Investigation Into Market Practices Underway

French officials raided several of NVIDIA Corp’s NVDA offices in the country as part of a probe into potential anticompetitive practices by the company.

The raid and investigation into NVIDIA’s possible misconduct are the company's first major bout with regulatory scrutiny, according to a report from The Wall Street Journal. 

The French "competition authority," similar to antitrust regulators in the United States, disclosed the raid on Wednesday, without naming NVIDIA specifically. But, sources familiar with the matter, confirmed that NVIDIA was the company involved. 

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The French competition authority is worried that large cloud-computing companies, like NVIDIA, will be able to use their robust access to computing resources and power to exclude smaller companies. NVIDIA’s main competitors in terms of semiconductor design and production are Advanced Micro Devices Inc AMD, Intel Corp INTC and Qualcomm Inc QCOM.

The rise of Chat-GPT and other AI-powered tools has led to a massive increase in demand for the high-powered computer chips that are NVIDIA's specialty. The French competition authority emphasized the rise of AI makes it necessary to ensure ample competition in the cloud computing space.

Cloud Wars: Amazon.com, Inc AMZN remains the biggest player in the cloud-computing space, followed by Microsoft Corp MSFT and Alphabet Inc GOOG according to Statista. NVIDIA is helping supply the leaders in the cloud computing space with chips powerful enough to keep up with the AI demand.

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