China launches anti-monopoly investigation against Nvidia amid US-China tech war

China’s market regulator has launched an investigation into US chipmaker Nvidia Corp for suspected breaches of the country’s anti-monopoly laws. 

The State Administration for Market Regulation also alleged that the US chipmaker might have broken commitments during its 2020 purchase of Mellanox Technologies Ltd, under conditions it was given to approve the acquisition, Reuters reported. 

The Chinese move follows the US’s third crackdown in three years on China’s semiconductor industry, which last week involved restrictions on exports to 140 companies, including makers of chip equipment. 

US President Joe Biden has imposed tighter controls on the sale of advanced technologies to China, and tensions over these export controls are likely to continue if Donald Trump returns to the White House. 

While this impasse has become a big geopolitical issue, Nvidia’s stock has risen over the past year. After the news of the probe, however, Nvidia’s shares fell 2 percent in pre-market trading, although the company is still one of the most valuable companies in the world. 

Established in 1993, Nvidia formerly manufactured graphics processing chips and was most notably known for producing graphics for video games. Currently, the company competes in a growing field: AI-inference processing chip fabrication. It has recently faced increased competition from AMD, Intel, and others. 

Nvidia has emerged the champion in AI due to pioneer development work concerning graphics processing units powering applications on AI. The group of products on GPUs is more integral for use in other machine learning activities, which entail data processing and deep learning, as well making the firm one of the sought providers around the globe, not just for IT organisations but for researchers too. 

Its leadership in AI has placed it at the centre of the next generation of computing, as AI-driven technologies continue to transform industries from healthcare to self-driving cars. This is the amazing growth in the demand for AI, and that has really driven Nvidia's market valuation through the roof, with the firm now among the most valuable globally, consistently above a market cap of over $1 trillion. Nvidia’s stance in AI innovation and its excellent performance in markets reflects the company’s role in determining the future of technology.