Nvidia, the American chipmaker, is facing antitrust investigation from China.
👉 Background: Over the past 12 months, the Biden administration has pumped billions of dollars into US companies like Intel to boost local production of AI chips and reduce America’s reliance on China.
👉 What happened: But now, Nvidia, the American chipmaker, is facing antitrust investigation from China. This all starts from Nvidia's 2019 acquisition of a networking company called Mellanox for nearly $7 billion USD. Now, the Chinese government believes this acquisition could violate China’s anti-monopoly laws.
👉 What else: As a result, Nvidia’s stock was down 2.6% earlier this week. And this is just the latest escalation of a real growing battle for AI dominance between the US and China.
💡Those who control the best AI, can control the world. In many ways, Nvidia is the face of the AI tech revolution because it currently holds between 70% and 95% of the market share for AI chips.
💡So hurting Nvidia could harm its ambitions to continue to power AI around the world. And this has become quite the tit-for-tat.
💡The US is pretty concerned that China could use AI to gain a military advantage over the US. Recently, the US imposed restrictions on the sale of AI chips to China. So this move by China could be seen as a retaliation.
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