Digital Event Horizon
European Commission urged to investigate Nvidia's acquisition of Run.ai amid concerns that it will further concentrate power in the AI industry.
Nvidia's acquisition of Run.ai has raised concerns that it will strengthen Nvidia's grip on the AI industry. The European Commission has been urged to launch a full investigation into the merger, focusing on its potential impact on the entire AI sector. The concern is that Nvidia will use Run.ai's software to build an additional barrier around its chip empire, limiting access for rivals and increasing its market power. The merger will reinforce Nvidia's control over the supply of advanced chips critical to downstream markets, particularly cloud and AI. This could undermine European AI companies' ability to remain competitive in global markets, increase costs, and lower quality for customers, including governments and businesses.
The European Commission has been urged to "fully investigate" Nvidia's purchase of workload management startup Run.ai amid worries that it will help tighten the GPU titan's grip on the AI industry. The price of the takeover, first revealed in April, has yet to be confirmed, although Tel Aviv-based AI-centric Kubernetes orchestration biz Run.ai was valued at $700 million after raising $18 million in cash over four funding rounds since its formation in 2018.
Run.ai's platform offers a central Unser interface and control plane that lets customers use a variety of Kubernetes flavors, incorporating some of the same tools for managing namespace, resource allocations and the like. The main point of distinction for Run.ai is that its platform is built to integrate with third-party AI tools and frameworks with respect to GPU-accelerated container environments. It already supports Nvidia's DGX compute platform, and Nvidia has pledged to maintain the same business model for Run.ai.
Nevertheless, a coalition of civil society organizations, including campaign groups Article19, FoxGlove, Balanced Economy Project, AI Now Institute, Gentium, and IT for Change, have written to the EC, calling on competition officials to inspect concerns that the transaction would allegedly "help Nvidia reinforce its super-dominance" in supplying GPUs by "integrating Run.ai software to build an additional barrier around its chip empire."
Foreclosing access to Run.ai from rivals is a major concern, and Nvidia will have the "ability and incentive to tie or bundle Run:ai's services with its GPUs." The letter adds that "the Commission must not be misled by Nvidia's announcement that Run:ai services will remain open source. There are different degrees of openness and AI companies frequently use 'open' rhetoric in ways that actually reinforce their market power. For instance, 'open source' can include serious limitations to competition such as the prohibition to use or develop a competing product. Such an approach would not preclude Nvidia from restricting access to the relevant technology or shutting it off completely at a later stage."
In response to these concerns, a spokesperson at Nvidia said that "We look forward to welcoming the Run:ai employees to our team. Although Run:ai supports only NVIDIA GPUs today, we plan to open-source Run:ai, making it available to all, as soon as the regulatory process is wrapped up. Not surprisingly, we haven't heard complaints from customers, partners, or even competitors about our plan."
The Open Markets Institute and co urge the EC to "launch a full investigation into the merger, focusing on the risks it poses to the entire AI sector." The merger will reinforce Nvidia's control over the supply of advanced chips that are critical inputs in downstream markets, particularly cloud and AI. Nvidia has become a key input provider across the entire AI sector since it supplies both the dominant cloud providers – despite their efforts to develop their own competing chips – as well as smaller 'neo-cloud' startups such as Coreweave, Crusoe or Lambda1, all of whom subsequently provide cloud computing and AI services to a wide range of businesses in Europe and worldwide.
This bottleneck undermines the ability of European AI companies to remain competitive in global markets and ultimately increases costs and lowers quality for European customers – including governments and businesses. It also undermines Europe's resilience by increasing its dependence on a single supplier for a critical technology, thereby exposing it to risks of coercion or supply chain disruption.
The letter states that Nvidia has an 88 percent GPU sales market share, worldwide, and is leaving Intel and AMD to eat its dust. It claims that Nvidia is using CUDA to shut out competitors, "developing its software offer to build a moat around its chips. It has built a closed environment in which its GPUs and proprietary software are tightly integrated."
It is against this background that Nvidia is acquiring Run:ai. By optimizing the use of scarce computing resources, Run:ai's GPU orchestration and virtualization services have the potential to significantly improve the performance of Nvidia's (already market-leading) GPUs and reduce the computation costs associated with AI development. Orchestration is already considered an important asset by GPU users as it scales resources across workloads to maximize performance and reduce cost, and it is therefore quickly becoming a standard market practice.
The European Commission has been urged to "launch a full investigation into the merger, focusing on the risks it poses to the entire AI sector." The merger will reinforce Nvidia's control over the supply of advanced chips that are critical inputs in downstream markets, particularly cloud and AI. Nvidia has become a key input provider across the entire AI sector since it supplies both the dominant cloud providers – despite their efforts to develop their own competing chips – as well as smaller 'neo-cloud' startups such as Coreweave, Crusoe or Lambda1, all of whom subsequently provide cloud computing and AI services to a wide range of businesses in Europe and worldwide.
This bottleneck undermines the ability of European AI companies to remain competitive in global markets and ultimately increases costs and lowers quality for European customers – including governments and businesses. It also undermines Europe's resilience by increasing its dependence on a single supplier for a critical technology, thereby exposing it to risks of coercion or supply chain disruption.
The letter states that Nvidia has an 88 percent GPU sales market share, worldwide, and is leaving Intel and AMD to eat its dust. It claims that Nvidia is using CUDA to shut out competitors, "developing its software offer to build a moat around its chips. It has built a closed environment in which its GPUs and proprietary software are tightly integrated."
It is against this background that Nvidia is acquiring Run:ai. By optimizing the use of scarce computing resources, Run:ai's GPU orchestration and virtualization services have the potential to significantly improve the performance of Nvidia's (already market-leading) GPUs and reduce the computation costs associated with AI development. Orchestration is already considered an important asset by GPU users as it scales resources across workloads to maximize performance and reduce cost, and it is therefore quickly becoming a standard market practice.
In addition to the Open Markets Institute, other signatories include campaign groups Article19, FoxGlove, Balanced Economy Project, AI Now Institute, Gentium, and IT for Change. According to some – perhaps conservative – estimates, Nvidia already has a dominant market share in terms of supplying the processors that train and deploy large language models. Revenue from AI semiconductors is estimated to be up 33 percent year-on-year in 2024 to $71 billion.
Nvidia's sales in the nine months ended October 27, 2024 were $91.2 billion versus $38.82 billion for the corresponding period in the prior year. Operating income was up to $57.4 billion compared to $19.35 billion.
The submission to the EC from the Open Markets Institute and co urges the EC to "launch a full investigation into the merger, focusing on the risks it poses to the entire AI sector." The merger will reinforce Nvidia's control over the supply of advanced chips that are critical inputs in downstream markets, particularly cloud and AI. Nvidia has become a key input provider across the entire AI sector since it supplies both the dominant cloud providers – despite their efforts to develop their own competing chips – as well as smaller 'neo-cloud' startups such as Coreweave, Crusoe or Lambda1, all of whom subsequently provide cloud computing and AI services to a wide range of businesses in Europe and worldwide.
This bottleneck undermines the ability of European AI companies to remain competitive in global markets and ultimately increases costs and lowers quality for European customers – including governments and businesses. It also undermines Europe's resilience by increasing its dependence on a single supplier for a critical technology, thereby exposing it to risks of coercion or supply chain disruption.
The letter states that Nvidia has an 88 percent GPU sales market share, worldwide, and is leaving Intel and AMD to eat its dust. It claims that Nvidia is using CUDA to shut out competitors, "developing its software offer to build a moat around its chips. It has built a closed environment in which its GPUs and proprietary software are tightly integrated."
It is against this background that Nvidia is acquiring Run:ai. By optimizing the use of scarce computing resources, Run:ai's GPU orchestration and virtualization services have the potential to significantly improve the performance of Nvidia's (already market-leading) GPUs and reduce the computation costs associated with AI development. Orchestration is already considered an important asset by GPU users as it scales resources across workloads to maximize performance and reduce cost, and it is therefore quickly becoming a standard market practice.
Related Information:
https://go.theregister.com/feed/www.theregister.com/2024/12/16/probe_nvidias_buy_of_runai/
https://www.msn.com/en-us/news/technology/take-a-closer-look-at-nvidias-buy-of-runai-european-commission-told/ar-AA1vXikM
https://www.theregister.com/2024/12/16/probe_nvidias_buy_of_runai/
Published: Mon Dec 16 09:31:53 2024 by llama3.2 3B Q4_K_M
