On December 9th, Nvidia was placed under investigation!
Due to suspected violations of the Anti Monopoly Law of the People’s Republic of China and the Announcement of the State Administration for Market Regulation on the Anti Monopoly Review Decision on the Approval of NVIDIA’s Acquisition of the Equity of Mailuosi Technology Co., Ltd. with Additional Restrictive Conditions, the State Administration for Market Regulation has launched an investigation into NVIDIA in accordance with the law.

The ‘arms dealer’ of the AI era.
NVIDIA is one of the world’s leading manufacturers of GPUs and AI chips.
According to analysis, the company’s market share in the global artificial intelligence chip market has reached as high as 90%.
According to other data, approximately 16% of Nvidia’s revenue comes from China, which is Nvidia’s second largest market after the United States.
It is not an exaggeration to say that in the era of AI, Nvidia firmly monopolizes the weapon of high-performance computing power and has become the largest “arms dealer” in the AI era.
According to US media reports, Nvidia’s market value has soared to $3.5 trillion recently, surpassing Microsoft and briefly leading Apple, making it the world’s most valuable company and once known as the “greatest company” of the AI era.
But this’ great company ‘among the masses has been experiencing frequent problems recently.
On December 9th Eastern Time, Nvidia closed down 2.55% at $138.81, with a market value evaporating $88.9 billion overnight. The high hanging ‘Sword of Damocles’ finally fell!

Nvidia’s breach of trust came first.
Nvidia is currently under investigation in China, involving an acquisition case that occurred five years ago. In 2019, Nvidia announced the acquisition of Israeli chip company MicroOS for $6.9 billion.
The acquisition of Maxus by Nvidia requires approval from regulatory agencies in multiple countries, including China’s anti-monopoly review.
The State Administration for Market Regulation of China has imposed restrictive conditions on Nvidia’s acquisition of shares in Maxus Technology Co., Ltd
① Do not force the bundling of Nvidia GPU accelerators and Maxus high-speed network interconnection devices in any way, or attach any other unreasonable transaction conditions;

② Continue to supply Nvidia GPU accelerators, Maxus high-speed network interconnection devices, and related software and accessories to the Chinese market based on the principles of fairness, reasonableness, and non discrimination;

③ Continue to ensure the interoperability between Nvidia GPU accelerators and third-party network interconnect devices, as well as between Maxus high-speed network interconnect devices and third-party accelerators;

④ Continue to maintain the open source commitment of the point-to-point communication software and collective communication software for the high-speed network interconnection equipment of Melos;

⑤ Take protective measures for the information of third-party accelerators and manufacturers of network interconnection devices.

After the acquisition, as a US company, Nvidia was subject to the US Chip Act and a series of subsequent export control policies, and did not fulfill its previous commitments, ultimately triggering China’s anti-monopoly investigation.

On the second day after the State Administration for Market Regulation decided to launch an investigation into Nvidia, Nvidia issued a statement stating that the company strives to provide the best products and fulfill its commitments in every region, and is willing to answer any questions from regulatory authorities regarding its business.

Some analysts believe that the statement to some extent reflects Nvidia’s current dilemma: on the one hand, it has to comply with US laws and regulations, while on the other hand, it wants to vigorously maintain its market share and interests in China.

A microcosm of the game between China and the United States.

In recent years, in order to meet the export control requirements of the US government, Nvidia’s contradictory operations in China are far more than just this one.

Although Nvidia’s product performance is at the forefront of the world, it is restricted by US policies and can only sell widely criticized “castrated” chips and graphics cards in China, continuously harming the rights of Chinese consumers and causing great impact on fair competition in the market.

On December 5th, Nvidia signed an agreement with Vietnam to establish an artificial intelligence center in order to better enter the Asian market. Some analysts suggest that Nvidia’s move is precisely in response to the US’s chip control over China.

In fact, the Nvidia antitrust investigation is essentially a microcosm of the strategic game between China and the United States.

In order to curb and suppress China’s rise, the United States continues to politicize economic, trade, and technological issues, promote pan security, abuse export control measures, and implement unilateral bullying.

In October 2023, the United States announced the “1017 Rule” to restrict the export of key GPU chips to China.

On December 2 this year, the Joe Biden government issued new semiconductor export control measures to China, including 136 Chinese enterprises in the “Entity List”, covering the whole chain of semiconductor manufacturing.

Faced with US sanctions, China quickly took countermeasures by strengthening export controls on dual-use items such as gallium, germanium, and antimony to the United States.

China’s investigation into Nvidia is not only a legal and regulatory response to the possible monopolistic behavior of the companies involved, but also a powerful response to the unreasonable technology suppression by the United States.

From the history of human technological development, any known technology cannot be stuck, at most it is a matter of time.

In recent years, China has introduced a series of policies to promote the development of the integrated circuit industry, which has propelled the rapid advancement of semiconductor technology in China.

According to the data released by the customs, China’s chip exports reached 931.1 billion yuan in the first 10 months of this year, and there is no doubt that the export value for the whole year of 2024 will exceed 1 trillion yuan.

It is expected that by 2025, China’s self-sufficiency rate in chips will reach around 70%.

It has been proven that external containment and suppression cannot hinder the development of China’s chip industry, but will only accelerate China’s technological self-reliance and self-improvement.