US probes NVIDIA's $20B Groq deal over antitrust concerns
What's the story
The US Department of Justice (DOJ) is looking into NVIDIA's $20 billion licensing deal with AI chip start-up Groq Inc. The investigation centers on whether the agreement was structured to evade antitrust scrutiny. The deal, announced in December, saw NVIDIA acquiring rights to Groq's technology while allowing Groq to remain an independent company.
Executive shift
Deal drew ire from US lawmakers
As part of the deal, Groq's CEO Jonathan Ross and COO Sunny Madra transitioned to NVIDIA. The move drew criticism from US lawmakers who claimed it was a takeover that suppressed competition.
The DOJ's investigation into NVIDIA is part of a wider regulatory focus on licensing and hiring practices.
This comes as a handful of companies, including Amazon, Microsoft, and Google, are accused of using such deals to gain access to promising technology and engineering teams while avoiding scrutiny.
Agreement status
NVIDIA defends deal, calls it 'prime example'
Notably, Groq, which makes processors to accelerate AI inference, did not file its licensing agreement with NVIDIA for antitrust review.
Responding to the investigation, an NVIDIA spokesperson said, "The Groq story is a prime example of the American system working as designed to promote innovation."
They added that the law is meant to encourage America's start-up ecosystem and protect inventors' and workers' rights.