Lately, we’ve seen some important developments related to U.S.-China trade relations. Trump and Jinping are on the verge of closing a deal to save TikTok in the US. Against this backdrop, Beijing has made a surprising and strategic move. Amid ongoing trade negotiations with Washington, China’s State Administration for Market Regulation (SAMR) has reportedly dropped its antitrust probe into Google, a case centered on the dominance of the Android operating system.
China reportedly ends Google antitrust case
China opened the initial investigation in February, potentially as a tariff-retaliation move. The case focused on Google’s impact on Chinese smartphone makers like Oppo and Xiaomi that rely on the software. This recent decision to terminate the probe, known as “zhongzhi” in Chinese, is not a sign of peace. Instead, it signals a calculated shift in Beijing’s strategy.
According to sources familiar with the matter (reported by Financial Times), China is concentrating its regulatory firepower on a different, more powerful target: Nvidia. Recently, Beijing banned the sale of certain AI chips from the North American giant. The move against the world’s most valuable chipmaker is a tactical maneuver to create maximum leverage in the ongoing trade talks, which have included discussions on tariffs, export controls, and the future of TikTok.
Why China is dropping its antitrust case against google for Nvidia
The contrast between Google and Nvidia’s situations in the Chinese market explains this shift. Google’s search engine and most of its core services have been blocked in China for years. So, there’s limited leverage in Beijing’s economy. Meanwhile, Nvidia and its competitor, Intel, have a significant market presence there. For Intel, China recorded sales of $15.5 billion in 2024, making it the company’s largest market worldwide. Similarly, China accounted for 13% of Nvidia’s global sales in the first three quarters of 2024, establishing it as the AI chipmaker’s second-biggest market. This deep market presence makes these chipmakers far more vulnerable to Chinese regulatory action.
Beijing’s new focus on Nvidia is already making headlines. China’s Cyberspace Administration has reportedly banned domestic tech giants like Alibaba and ByteDance from purchasing Nvidia’s new, custom-made AI chips, the RTX Pro 6000D. At the same time, the SAMR has accused Nvidia of violating its antitrust law during its 2020 acquisition of Mellanox Technologies. If found in violation, Nvidia could face fines of 1 to 10% of its previous year’s sales. This could potentially amount to billions of dollars.
A chess game between two world powers
As the U.S. continues to limit the sale of advanced chips to China, Beijing is responding by hitting back where it hurts most. The decision to drop the Google probe while intensifying pressure on Nvidia is the latest twist in a global struggle that is far from over. It will be interesting to see how events develop in the near future.
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