Nvidia AI chips are a ‘huge bottleneck’ but that doesn’t mean regulatory action, EU says

Margrethe Vestager, head of the European Union’s competition commission, has warned of a “massive bottleneck” in Nvidia Corporation AI chips are among the available supplies, but regulators are still deciding whether there’s anything to do about it.

“We have asked them questions, but these are just preliminary questions,” she told Bloomberg during a visit to Singapore, adding that this “will not yet serve the purpose required as a regulatory measure.”

Nvidia has caught the attention of regulators since becoming the biggest beneficiary of the AI ​​spending boom. Its graphics processing units — or GPUs — are prized by data center operators for their ability to process the massive amounts of information needed to develop AI models.

Chips have become one of the hottest commodities in the tech world, with cloud computing providers competing with each other for access to them. Nvidia’s in-demand H100 processors have helped it gain more than 80% market share, according to estimates, ahead of rivals Intel Corporation And Advanced Micro Devices Inc.

Despite the supply pressure, Vestager said secondary markets for AI chip supply could help spur innovation and fair competition.

But she said dominant companies may face certain restrictions on their behaviour in the future.

“If you have that kind of dominant position in the market, there are things you can’t do that a small company can do,” she said. “But other than that, as long as you do your business and respect that, you’re fine.”

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