Companies Object Nvidia’s Arm Acquisition

Big companies like Microsoft, Google, and Qualcomm are seen raising concerns to regulators about Nvidia’s deal of acquiring Arm. The companies have approached regulators of the countries like US, EU, UK, and China. Companies’ main concern is regarding the chances of how Nvidia could change the way how usually Arm licenses out its chipmaking technology.

However, Nvidia has pledged in regard to not using its control over the company to change how it interacts with other businesses in any manner. Writing to the Financial Times, Nvidia CEO Jensen Huang said, “I could unequivocally state that Nvidia will maintain Arm’s open licensing model. We have no intention to throttle or deny Arm’s supply to any customer.”

Meanwhile, all the rival companies of Nvidia argue that it sounds practically insane on behalf of Nvidia that it will keep Arm neutral and would not use Arm’s tech to its own gains that too after paying $40 billion for it. It isn’t something that the company would be incentivized to do. Putting restrictions on licensing would definitely hurt the companies that are being benefited from using the licensed Arm’s technology. However, Google and Microsoft are reportedly in their process of making their own Arm-based chips, and Qualcomm’s processors on the other hand are based on the architecture.

As far as these arguments are concerned, Nvidia has replied with some explanations that the acquisition of Arm is only about driving AI forward which is an area Nvidia has focused on heavily for last many years including everything from its machine learning-powered upscaling on its graphics cards to its work in self-driving cars. The low-power technology of Arm could help Nvidia in spreading AI into more unexplored places. But the company will also figure out the things to do apart from what generally Arm does. General working areas of Arm mainly include powering almost every cellphone in existence along with holding the key to computer companies choosing to move away from Intel.

Regulators are also apparently looking very closely at the deal with the aim to determine the fact whether this deal would give Nvidia too much power in the business of chipmaking business. However, the Federal Trade Commission has recently asked Nvidia and Arm to give it more information and Commission is also planning to talk to other companies who may have relevant information.

Meanwhile, UK and EU officials have promised the companies to thoroughly investigate this deal. It is a fact that that they likely will hear many objections not just including Google, Microsoft, and Qualcomm, but also others who are in the chipmaking industry and are concerned about their own open-licensing agreement with Arm being affected by the merger.

These companies have dealt before with regulators and the anti-competitive behavior of others. Qualcomm also has had to pay several fines amounting in the hundreds of millions and sometimes billions of dollars to authorities in countries like China, South Korea, and the EU for its anti-competitive licensing policies. Microsoft had its big monopoly case in the late ‘90swhere it got the courage to go up against the US government, and last but not the least, Google has recently been the main focus of growing antitrust sentiment in the US and EU.