US antitrust probe endangers Nvidia – Run:ai deal – report

The US Department of Justice is conducting an antitrust investigation into US AI chip giant Nvidia Corp.’s acquisition of an Israeli AI infrastructure management company. Run: You haveIn fact, the investigation is jeopardizing the completion of the $700 million acquisition, Politico and the Financial Times reported.

Tel Aviv-based Run:ai, founded in 2018 by CEO Omri Geller, Dr. Ronen Dar and Prof. Meir Feder, has developed a system that allows Nvidia’s graphics processors to perform more operations, thereby eliminating the need to buy more of its own. According to sources who spoke to Politico, the concern is that Nvidia acquired the Israeli company in order to “bury a technology that could undermine its main profit engine.”

The Run.ai acquisition is just one of a number of alleged anticompetitive practices being investigated against the US AI chip giant, which are slowly being exposed by the US media.

Nvidia has become a monopoly in the AI ​​processing market, owning 90% of all advanced chips in the field. The US regulator is examining a number of claims that Nvidia has created an unfair competitive advantage — such as making access to its chips conditional on the purchase of other products, or committing not to buy products from competitors.

According to Politico, the US investigation into the artificial intelligence market is divided between the Federal Trade Commission (FTC), which is investigating Microsoft’s partnership with OpenAI, and the Department of Justice, which is investigating Nvidia’s business practices.

Nvidia’s CUDA software, which is used to write applications for Nvidia’s graphics processing units, is also under investigation in both the US and Europe. The French antitrust authority is concerned about the industry’s reliance on Nvidia’s CUDA chip programming software, the only one that is fully compatible with the GPUs that are essential for fast computing.

“Nvidia wins on merit, which is reflected in our benchmark results and our value to customers,” Nvidia told Politico. “We compete on the basis of decades of investment and innovation, while strictly adhering to all laws.”

If the Run:ai acquisition fails to pass antitrust scrutiny and is canceled, it would be a blow to Nvidia’s development center in Israel — the US giant has acquired two Israeli AI companies — Run.ai and Deci, which developed an algorithm for compressing language models. Run:ai and Deci make Israel a major software development center for Nvidia outside the US, and canceling the acquisition of the larger of the two could hurt that effort.

This article was published in Globes, Israeli Business News – en.globes.co.il – on August 2, 2024.

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