With its AI processors now being a critical part of the tech infrastructure for giants like Microsoft and Meta Platforms, Nvidia’s practices have become a central focus for regulators. The company’s French offices were also raided in 2023 for alleged “anti-competitive practices.”
“Balancing innovation, scale, and competition is one of the most significant challenges facing big tech today, especially as the industry evolves rapidly,” said Faisal Kawoosa, Founder and lead analyst at Techarc. “While other companies are attempting to enter the AI chip space, it’s not necessarily due to Nvidia actively restricting them. However, the barriers to entry are undeniably high, requiring substantial investment and fundamental R&D. Nvidia has spent years developing its technology, making it difficult for others, who are only just starting, to catch up.”
Nvidia’s approach to offering a full stack of AI solutions — from compute to software to networking — positions it strongly in the current AI boom, surpassing its competitors in both technology and scale.
“Nvidia is in a dominant position, offering a comprehensive stack that outpaces rivals in technology, performance, and scale,” said Neil Shah, VP for research and partner at Counterpoint Research. “However, this strong market position could frustrate competitors and limit customers’ negotiating power. With Nvidia’s bundled solutions, there’s a risk of inflexibility and added costs for customers seeking to mix and match solutions.”
Shah further pointed out that as a market leader, Nvidia will face intense scrutiny and may need to be more flexible to support competitor solutions, much like how Apple, Microsoft, and Google have had to manage their market dominance.
The news agency reported that Nvidia’s stock, which recently suffered a historic $279 billion loss, took another hit following the news of the subpoenas.
