29 ms·

FTC sues to block Nvidia-Arm merger

722 points by badwolf 5y ago

rastapasta42 5y ago
I don't get the logic. So US government is ok with ARM China getting kidnapped, but has a problem with merge of 2 US companies? https://www.extremetech.com/computing/326447-arm-china-seizes-ip-relaunches-as-an-independent-company https://www.extremetech.com/computing/326447-arm-china-seize...
- macintux 5y ago
  > So US government is ok with ARM China getting kidnapped Two factors here: ARM isn’t a U.S. company, and neither the U.K. nor U.S. would seem to have a great deal of leverage to bring to bear on the situation, realistically.
  - rastapasta42 5y ago
    "No leverage" "Our hands are tied" "The bribe was too large to refuse" Our grand-children will hate us for being cowards and short-sighted profiteers. https://www.wionews.com/world/joe-bidens-son-helped-china-get-control-over-vast-cobalt-mine-in-africa-report-432925 https://www.wionews.com/world/joe-bidens-son-helped-china-ge...
KETpXDDzR 5y ago
I wonder if the "ARM China went rouge" stuff is related. https://news.ycombinator.com/item?id=28329731 https://news.ycombinator.com/item?id=28329731
kwere 5y ago
is softbank (ARM owner) in need of cash?
- gjsman-1000 5y ago
  I wonder how much a business' valuation is determined by sale potential. If you have a business that is worth a lot, and yet nobody can or will buy it, how much is it really worth? Obviously it's still worth something, it's just that the valuation becomes really fuzzy except for the assets.
  - ttt333 5y ago
    Formerly worked in Investment banking: it is a huge huge determinant of value. Particularly for a lower-dividend, higher growth company like Nvidia, the vast majority of the present value comes from the terminal value (what someone else will pay you for it when you're done holding the investment), made even more extreme by low interest rates.
    - richardwhiuk 5y ago
      Couldn't it transform into a high-dividend company?
      - JumpCrisscross 5y ago
        > Couldn't it transform into a high-dividend company? This is cigarette-butt investing. It ignores terminal value. If the terminal value is already close to zero, it's the right move, an orderly wind-down and re-allocation of assets. If there is terminal value, it's a pillaging. Cases like these, where the terminal value starts looking more theoretical than practical, are how those incentives shift.
        rswail 5y ago
        What happens in the situation where there isn't a "terminal" point for a company? Coca-Cola has no reason to "terminate" itself, so why shouldn't it distribute profit excess to its operating requirements back to shareholders?
        5y ago
gjsman-1000 5y ago
If I was working for Qualcomm... I would say that the FTC suing right now is almost maliciously late. Edit: So much so, that I would almost start my defense with claiming that the FTC's charges are in bad-faith.
bobsmooth 5y ago
I'm conflicted. As an NVDA holder, I'm disappointed. As a tech lover, this is for the best.
- Dracophoenix 5y ago
  Is it? Nvidia gave plenty of good examples of what it has been able to accomplish with ARM tech in their previous keynotes. If anything, I've come around from thinking this was simply a power play on Nvidia's part, to seeing this merger as a win-win-win for Nvidia, the ARM ISA, and ISA competition as a whole.
  - bobsmooth 5y ago
    Whatever neat things Nvidia is doing with ARM can be done with ARM being independent.
    - GhettoComputers 5y ago
      Can you show evidence of this? There has never been a good open ARM processor for mobile computing ever, the Jetson is the best open one while the Apple chips and M1 is the technically best one.
      - bobsmooth 5y ago
        You answered your own question. Nivida doesn't need to own the entirety of the mobile processor market.
        GhettoComputers 5y ago
        So then they’re no good reason to block it. They would do a better job than it currently it currently is in now, mobile processors aren’t all ARM either.
        mijoharas 5y ago
voz_ 5y ago
This is a good thing, from any way you look. The last thing we need is more consolidation, and less competition, in this space.
- gjsman-1000 5y ago
  On the other hand, a NVIDIA ARM acquisition could really spark RISC-V adoption. Maybe.
  - Alupis 5y ago
    There are very few positive signs Nvidia would be a good caretaker of ARM IP, continue to push new innovated and open designs and mass adoption. Nvidia's entire business and philosophy regarding their chip designs are kind of antithetical to what ARM was achieving.
    - gjsman-1000 5y ago
      All you have to see is NVIDIA's trashy effort on Linux and locking-down what-would-otherwise-be-open hardware from being usable by open-source drivers...
      - GhettoComputers 5y ago
        And ARM had constantly updated Linux kernels and drivers from Qualcomm before didn’t they?
        monocasa 5y ago
        ARM works very, very closely with the Linux kernel. The issues with updated code in the kernel isn't because of ARM CPU IP.
        rjsw 5y ago
        ARM hasn't been much better than Nvidia for GPU code.
barbacoa 5y ago
It's surprising the US gov would take action to stop this. One one hand yes, this isn't great for the industry. But on the other it would mean that ARM will become an American owned company which gives the US government enormous new tech war leverage against China.
- bogwog 5y ago
  I wonder if vague fears about China are part of the reason the FTC has been sitting on their ass doing nothing about the tech industry for the past decade+? It would be ironic if true, because their failure to intervene has hurt America's ability to innovate and created opportunities for China.
- zarzavat 5y ago
  It seems extremely unlikely that the UK will allow this deal anyway so it is somewhat moot what the FTC does. The original ARM sale to Softbank was made while everybody was distracted by Brexit, and is regarded as somewhat of an embarrassment. However Softbank appears to have played themselves because any attempt to sell ARM to a non-British owner will likely be denied as politically unacceptable.
  - starfallg 5y ago
    >However Softbank appears to have played themselves because any attempt to sell ARM to a non-British owner will likely be denied as politically unacceptable. Softbank gets to keep a cool $1.25 billion in cash from Nvidia if the deal falls through. It's standard M&A practice and so a win-win situation for them.
    - Qub3d 5y ago
      Is it that general? Its one thing if a deal fails because a party gets cold feet, or can't reach an agreement. Its another if the parties are all agreed and ready and a regulator steps in, isn't it?
  - fomine3 5y ago
    The worst thing Softbank did is selling Arm China stock to China local. This is serious failure for western world.
mrlambchop 5y ago
A late, but potentially still well timed event that will tie up the deal through to next summer when the exclusivity period expires and SoftBank gets a 1.25B breakup fee.
- KingMachiavelli 5y ago
  Is that good? The Nvidia-ARM merger has progressed and been in the news so many times that it's been partly responsible for Nvidia's stock growth. It's a bit strange to correct a market by blocking a merger while choosing to sue at the most disruptive time (correcting/bear-ish turned market, inflation policy changes, very close to the exclusivity period expiration). The FTC should be doing its job but it should be doing it the proper way - not just delaying the deal until it falls apart. It should also do its job promptly... the UK was looking at this deal nearly a year ago - that should have been a huge flag to accelerate their own investigation. What's the point of wasting months of people's time and money.
dcow 5y ago
Strategically, why wouldn’t the US gov’t want a US company owning ARM? Why is the FTC pilling on to block this? How would I, as a consumer, be harmed by a graphics company owning an instruction set and design specification? Stopping two US companies from merging because it would create a monopoly and negatively impact US consumers is one thing. But this isn't even remotely the case here? Doesn't the US government get more tax revenue if Nvidia makes some extra dough charging royalties for that IP? I’m confused.
- russellbeattie 5y ago
  You're not paying attention if you think Nvidia is just a "graphics company". As a chip supplier they are known to be aggressive to the point of bullying and their negotiations tend towards the extortion end of the business spectrum. I like Nvidia (because I don't have to work with them), but I don't think they are the right steward for ARM in any way.
  - dcow 5y ago
    So the headline should read: Nvidia too much of an asshole to own ARM? Let’s update our laws too. I’m serious, if we don’t want companies to be assholes then we’d need to regulate how they negotiate and a lot of other things.
    - effie 5y ago
      Caring only about laws and not about reputation of being a good ecosystem partner to others is a recipe for others to look elsewhere. NVIDIA has a really bad rep due to its arrogant behaviour towards customers and other companies (Linux project, Apple). Maybe this ARM drawn out saga is just karma coming back from that.
      - shrewduser 5y ago
        Nvidia has burned its bridges with a lot of companies over the years (Microsoft comes to mind, i'm pretty sure they will never use an nvidia chip inside an xbox ever again)
shmerl 5y ago
Good. Nvidia is a pretty lock-in oriented and anti-competitive company in general. So them getting ARM would have been bad.
- GhettoComputers 5y ago
  Any ARM hardware that isn’t? Jetson was way more open compared to all other ARM hardware I know of.
  - shmerl 5y ago
    Mots are pretty bad I guess. For example Qualcomm is horrible.
    - GhettoComputers 5y ago
      I’m excited for project mainline from google, maybe they can make a good generic kernel for all ARM processors. https://www.xda-developers.com/android-project-mainline-modules-explanation/ https://www.xda-developers.com/android-project-mainline-modu...
      - shmerl 5y ago
        An improvement for sure if they'll require upstreaming drivers (as in making them FOSS), because Android is causing a rift as long as drivers have blobs due to bionic vs glibc.
nus07 5y ago
https://www.newyorker.com/magazine/2021/12/06/lina-khans-battle-to-rein-in-big-tech https://www.newyorker.com/magazine/2021/12/06/lina-khans-bat... A rather long read but it’s starting to make sense .
- 2OEH8eoCRo0 5y ago
  Came here to post the same thing. Very good read.
  - abnercoimbre 5y ago
    I must signal my approval of this piece. They have a great audio narration available for free as well. I'll be following this new FTC closely.
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hn_throwaway_99 5y ago
I think the comments along the lines of "This is weird, why wouldn't the US govt want a US company to own ARM?" are incredibly simplistic. First, it's at least possible that some government agencies actually do care about their charters and don't make it 100% about any one-sided geopolitical advantages. It's not hard to see how this deal will be bad for American consumers and businesses at large, and the FTC's purpose is to prevent that harm. But more than that, even if you do take the position that they only care about realpolitik, the US government's desire to reign in big tech is about the sole thing that has bipartisan support. This action is well in line with keeping big tech from usurping the power of government.
- deleted 5y ago
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- dcow 5y ago
  > It's not hard to see how this deal will be bad for American consumers and businesses at large, and the FTC's purpose is to prevent that harm. I am having a hard time understanding this. Care to explain rather than sidestepping and calling out my comment as overly simplistic? It seems the FTC is acting to protect businesses (ironically other big tech), not consumers. That’s what I don’t get. > This action is well in line with keeping big tech from usurping the power of government. “It’s political” isn’t really an explanation either. There’s certainly something to discuss about at what point a company becomes too big and valuable, but that doesn't seem to be the stated motivation here. And I’d be interested in understanding what the framework is for applying those restrictions and how e.g. a company like Apple slid by without getting dismantled. EDIT: To put my confusion another way, at the end it says “The FTC acts when it has reason to believe the law has been or is being violated.” What law has allegedly been violated or would be violated should this merger succeed?
  - nnvvhh 5y ago
    One thing the TFA says: "Because Arm’s technology is a critical input that enables competition between Nvidia and its competitors in several markets, the complaint alleges that the proposed merger would give Nvidia the ability and incentive to use its control of this technology to undermine its competitors, reducing competition and ultimately resulting in reduced product quality, reduced innovation, higher prices, and less choice, harming the millions of Americans who benefit from Arm-based products, the complaint alleges." When a downstream firm merges with an upstream supplier that is really important to the downstream firm and its competitors, the merged firm can competitively hobble the downstream competitors. They can refuse to sell the upstream good to competitors, or raise the cost for competitors. Plus it may force the competitors (or potential new entrants) to vertically integrate themselves and enter both the downstream and upstream markets, which chills competition in the downstream market. The government also credits business justifications for the merger, and in the end they balance those with the potential harms to competition. The article (I can't find the complaint) also says, and this is a typical vertical merger concern, that this will give Nvidia (the downstream firm) access to sensitive information of Nvidia's rivals that they had previously shared with Arm. EDIT: There is also a general antitrust push in the Biden administration, notably in the appointments of Lina Khan and Tim Wu. Interesting to see its fruits.
InTheArena 5y ago
Rule of law still matters. It’s interesting to see how differently ARM is treated versus ARM China.
volta83 5y ago
> DPU SmartNICs, Which other companies beyond NVIDIA sell DPUs ?
- Zandikar 5y ago
  Marvell, Fungible, Broadcom, and Intel (though they may brand them as IPU or something else, they're in the same market/use niche), possibly more.
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blablabla123 5y ago
This is the most megalomanic thing I've ever heard of. ARM has high chances to be both the next x86 and the most common embedded architecture. While at the same time Nvidia GPUs are already the de facto standard for GPU computing. So Nvidia would have monopolies in 2 verticals. No reasonable and competent antitrust commission could ever allow that - although probably everyone was betting the latter wasn't the case...
- xiphias2 5y ago
  I totally agree… what’s interesting is that some of the reasons that FTC provide are totally not what’s interesting (self driving). I have a MacBook Pro with M1 ARM chip, and I love it, it’s extremely power efficient, I don’t really have to think much about charging it. It wouldn’t be possible if NVIDIA could force its chips on Apple.
  - effie 5y ago
    How long can you use the M1 laptop on single charge?
    - xiphias2 5y ago
      https://support.apple.com/kb/SP824?locale=en_US https://support.apple.com/kb/SP824?locale=en_US The official number is 17 hours, bu I never had to test it in real life. The crazy thing is charging to 50% in 30 minutes, and 50% is enough to get me through my trips.
      - effie 5y ago
        That's great. Yeah, once the on-battery time is slightly greater than one workday requires, increasing it further stops being interesting. For battery longevity, in general I would charge to 90% and then use it until 20%, then recharge to 90% again. This makes the most out of the battery charge cycles, and avoid the increased stress of close-to-0% charge (bad if there for longer time) and close-to-100% charge (less bad but still better not to go there often). But maybe M1 battery system is different for some reason, I don't know.
mullingitover 5y ago
So what I'm reading is Intel ordered the FTC to dismantle any potential competition.
- dang 5y ago
  Please don't post unsubstantive/flamebait comments. We're trying for something else on this site. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
  - mullingitover 5y ago
    Sorry, I'm expressing my sincere belief that there's real corruption at the upper echelons that's benefitting Intel. I can see how my terse comment would come across as flamebait, it wasn't intentional. Intel's consistently rich margins don't really make sense if we actually have a fair and competitive market.
Bud 5y ago
It's shocking how just four years of Trumpism have made it difficult for Americans to even imagine a US government agency actually doing its job, as it was intended to do. We now just automatically jump to assuming "fuck everything, except making more money and Mercuh". Sad.
- krapp 5y ago
  > It's shocking how just four years of Trumpism have made it difficult for Americans to even imagine a US government agency actually doing its job, as it was intended to do. It wasn't just four years of Trumpism. Trumpism was simply the fruition of decades of successful neoliberal anti-government propaganda, primarily from the Republicans, going back at least as far as Reagan saying "Government is not the solution to our problem, government is the problem." What Trumpism added was mainstreaming conspiracy theory on top of the general disposition that government should be starved until it was weak enough to be drowned in the bathtub. So now the Libertarians are talking about limited government and how Fauci created COVID for the Illuminati.
- genousti 5y ago
  Its not Trump that jailed chelsea manning and wage war against assange. Wake up
- dang 5y ago
  Would you please stop taking HN threads further into flamewar? Discussion quality takes a sharp step down with posts like this. Please make your substantive points without doing that. We detached this subthread from https://news.ycombinator.com/item?id=29423448 https://news.ycombinator.com/item?id=29423448.
gip 5y ago
As a former hardware engineer I support the move by the FTC! I have an honest question though: does the lawsuit have any realistic change to block that merger?
- not2b 5y ago
  It seems it will at least delay it while the lawyers fight it out in court.
- pm90 5y ago
  It absolutely does. The FTC doesn’t bring lawsuits forward unless they have pretty good reason to believe they will succeed. I suspect they have been gathering evidence to make this case for a while now.
  - scandinavian 5y ago
    Always such a weird argument. I assume Nvidia also doesn't try to aquire large companies unless they have pretty good reason to believe they will succeed.
    - pm90 5y ago
      I dislike even engaging with this kind of lazy reasoning. The offer was made under a different US administration which did not prioritize enforcement of antitrust laws.
      - scandinavian 5y ago
        If you dislike lazy reasoning, why do you post it on HN?
- e-_pusher 5y ago
  This is an aside but: what made you switch away from hardware engineering? And what are you doing nowadays?
keewee7 5y ago
This might be the geopolitical blunder of the decade. If this merger doesn't happen China is going to win the chip race. As an European I'm increasingly bullish on China and see the US and EU as self-sabotaging neurotic entities.
- CameronNemo 5y ago
  What is the "chip race" and why is a combined NVIDIA/ARM necessary to "win" it? Aren't AMD/TSMC, Apple/TSMC, and Intel enough to be competitive?
  - keewee7 5y ago
    TSMC is Taiwanese, China will takeover Taiwan in the next 5-10 years, and Intel's manufacturing processes are ancient. The future when US/EU can't produce our own chips is rapidly approaching.
    - CameronNemo 5y ago
      And... What do ARM or NVIDIA have anything to do with fabrication? If anything a merger will hurt Intel and make it harder for them to update their processes.
    - unionpivo 5y ago
      You do realize that neither Nvidia nor Arm, have their own foundries and have shown no signs of wanting to build one ? TSMC and Nvidia are not in the same business.
    - rswail 5y ago
      TSMC is building new plant in the US and elsewhere outside of Taiwan. There's no guarantee that Chine will "takeover" Taiwan any time soon, the geo-politics of that are way more enormous than just chip manufacture. Most of the development in manufacturing of chips is by the companies that supply the fab developers, the integration of those skills and components is where the different fab owners have their competitive advantages. The "future when the US/EU can't produce our own chips" was also in the 80s when there was a push to develop memory manufacturers and back then, Japan was the evil empire that needed to be stopped. TSMC would continue post a China takeover of Taiwan.
lr1970 5y ago
Apple, Qualcomm, Intel, AMD probably lobbying FTC against this deal.
- tempfs 5y ago
  Finally, someone gets it. There is a lot of other well intended, intellectually driven arguments and opinions in this thread, but I am afraid that the people actually making the calls here are mostly likely being guided by their own self interests.
  - dcow 5y ago
    No no, this is what I'm trying to get to the bottom of. I don't see any way this is strictly substantially bad for consumers or reduces competition in a way that antitrust law would apply, and I don't see any way this is at all bad for the US strategically. So the FTC is issuing a complaint in response to ..something.. that goes against the interest of our own government and has nothing to do with consumers (hell I'd love to see an Nvidia N2 SoC that competes with the Apple M1). Bingo, it's other big tech firms lobbying. These other big tech firms most certainly have y'alls interest at heart and are just looking out for you, small fry. Give me a break!
    - yehaaa 5y ago
      Nothing is stopping Nvidia from creating a N2 SoC that competes with the Apple M1. They don’t need to own ARM to do that. They can even create their own SOC with a Nvidia GPU.
    - max_ 5y ago
      The point is that this was arbitrary use of power. Not if the intention was good or bad. [0]: https://www.collinsdictionary.com/dictionary/english/arbitrary-power https://www.collinsdictionary.com/dictionary/english/arbitra...
  - abnercoimbre 5y ago
    Usually I'd agree, but we're likely wrong on this one. I recommend this New Yorker piece detailing the new FTC [0]. [0] https://www.newyorker.com/magazine/2021/12/06/lina-khans-battle-to-rein-in-big-tech https://www.newyorker.com/magazine/2021/12/06/lina-khans-bat...
nikolay 5y ago
I guess, the government is friends with Apple. The corruption in the US is beyond imagination, just on a totally different level than anywhere else in the world! When iPhone was a monopoly, it was fine. When Facebook is a monopoly, it's fine. When Google is a monopoly, it's fine, but when it comes to more traditional businesses - no, it's not fine as chips can't be used as political tools unlike Apple's, Google's, and Facebook's platforms!
- deleted 5y ago
  [deleted]
- matthewmcg 5y ago
  I think you need to recognize that the FTC is governed by its commissioners and chairperson, and those people have their own priorities that are going to be different than their predecessors. Lina Khan, current chair, is much more focused[1] on controlling tech monopolies than Trump’s appointees, who had what you might charitably call more “market oriented” priorities[2] (to me, a euphemism for “bought by big business”). [1]: https://www.newyorker.com/magazine/2021/12/06/lina-khans-battle-to-rein-in-big-tech https://www.newyorker.com/magazine/2021/12/06/lina-khans-bat... [2]: https://www.politico.com/story/2019/05/08/ftc-chairman-congress-rulemaking-authority-1418237 https://www.politico.com/story/2019/05/08/ftc-chairman-congr...
  - nikolay 5y ago
    Is there are more a blatant monopoly than Meta? Or Google for search?
usr1106 5y ago
Good that they remember their tasks of enforcing antitrust rules when it comes to mergers. When will they remember them in cases of disruptive growth like Google and Amazon and do AT&T?
varelse 5y ago
Our government continues to show how corrupt and bad it really is. It'll be super funny when Qualcomm buys ARM instead because that's a-okay and all that. Edit: you know Qualcomm has already said that's exactly what they're going to do right? Maybe the Nvidia CEO needs to kill a goat with a stun gun and feed it to the FTC to send the right message? That seemed to work really well for Zuck. https://www.cnbc.com/2021/06/14/qualcomm-offers-to-invest-in-arm-as-regulators-threaten-nvidia-deal.html https://www.cnbc.com/2021/06/14/qualcomm-offers-to-invest-in...
- gifnamething 5y ago
  >Edit: you know Qualcomm has already said that's exactly what they're going to do right? Well that's not what your link says
  - varelse 5y ago
    Okay if you trust that buying an unspecified stake doesn't lead to an acquisition once the smoke has cleared you have a very different worldview than I do. We will have to agree to disagree. It does seem like the next 100 years is just more of what's been going on the past decade and it seems pretty grim for the customer and great for the corporations as they duke it out with each other much like what this seems to really be about.
    - gifnamething 5y ago
      I don't need to trust it, the rules for acquisition are much more strict than the rules for part ownership.
      - varelse 5y ago
        Fascinating... So many strange acquisitions and this is the one that triggers all the red flags. The story will come out eventually and I think it's going to be a doozy.
- rswail 5y ago
lvl100 5y ago
This is not material in my view in the sense that it was going to get blocked by EU. And to be perfectly honest, it’s really not Nvidia’s fault that ARM sold out to Softbank, a known player with hard investment return mandates. I am sure Apple gave this a big push along with other players mentioned in comments. As for the validity/veracity of the suit, it’s 50/50.
- rswail 5y ago
  It's likely to be blocked by the UK first, then potentially the EU, then the FTC. There are plenty of people lining up against NVidia on this.
mercy_dude 5y ago
There goes my NVDA calls. I should have sold when it hit the ATH.
rodmena 5y ago
A big win for consumers.
NortySpock 5y ago
The reason to block the merger is pretty straightforward: 1) Nvidia designs expensive chips and sells them by the millions. [1] 2) ARM designs cheap chips and sells them by the billions. [2] 3) Nvidia's "normal" product departments are incentivized to prevent ARM from competing with Nvidia's expensive chips, in various ways. This would hinder ARM's innovation and growth opportunities vs being independent. I am glad to see this motion to block the merger, for the sake of a competitive market for CPUs, GPUs, etc. [1] https://www.techradar.com/news/nvidia-hits-new-highs-in-gpu-sales-as-ampere-dominates-amd-big-navi https://www.techradar.com/news/nvidia-hits-new-highs-in-gpu-... [2] https://www.tomshardware.com/news/arm-6-7-billion-chips-per-quarter https://www.tomshardware.com/news/arm-6-7-billion-chips-per-...
- dcow 5y ago
  ARM doesn't sell chips. They license the instruction set. Ask Apple or Qualcomm if the final ARM SOCs they build and sell are cheap...
  - kadoban 5y ago
    I don't see that that really changes anything here.
    - dcow 5y ago
      Well the argument is that ARM is cheap and good for consumers because it's cheap. I wanted to make it clear that you can't go to ARM and buy <cheap arm chip>. You have to go to Qualcomm or Apple or Broadcom and buy <not quite so cheap arm chip>. So that kinda impacts the argument. Whatever Nvidia wants to do with licensing they have to combat market forces already in play. There's a market for somewhat less expensive arm chips, for one, so they'd lose that revenue. Two, if they want to royally fuck arm shops and become the only ARM vendor, well, good luck... you just killed the ISA you bought for 40 billion...
      - throwaway2048 5y ago
        40 billion isn't much to sabotage the vast majority of your competitors
emodendroket 5y ago
The idea that you can possibly have a bunch of small companies competing in the modern semiconductor space is risible. If a big private concern makes you feel bad you could think about bringing the government into it but I see little other way forward.
DarkmSparks 5y ago
I was pretty skeptical on attempts to block this merger, still am tbh. But I'm also very happy this is going to get the scrutiny it needs, both nvidia and arm are pretty vital to the tech industry right now, I can see it going either way, ARM needs better GPU patents, NV needs better SOC patents, the risk of a merger being a disaster is pretty high.
- fennecfoxen 5y ago
  > ARM needs better GPU patents Remember also that "GPU" technology is not strictly about graphics. If you browse the marketing website, listen to the keynotes, and generally learn of the NVIDIA vision of the future, it is something like this. There will be tons of little robots and similar endpoints ("edge computing"). Such a robot will be powered by a little ARM chip with an NVIDIA coprocessor for its on-board AI (computer vision, mobility, and the like). The robot will talk over 5G or one of its successors — the signal processing for the base station perhaps powered by something like NVIDIA AI-on-5G. This communication link will connect it with compute appliances in the nearest utility closet or server room, wherein NVIDIA simulation and route-planning software maintains a "digital twin" of the real world, and helps orchestrate their operations, while operators can render that model on their local machines. And all these devices will have computer-vision and route-planning models on board, models that are trained in the big machines in the datacenter. We have a few of these systems in computing today, but AI coprocessors will become very interesting as we move deeper into this world.
  - erikpukinskis 5y ago
    > Remember also that "GPU" technology is not strictly about graphics. It’s not even primarily about graphics anymore. Graphics seem to be the 2nd if not 3rd most common use for GPUs.
COGlory 5y ago
The FTC mentioned chips in vehicles multiple times. >The FTC’s complaint alleges that the combined firm would have the means and incentive to stifle innovative next-generation technologies, including those used to run datacenters and driver-assistance systems in cars. and here: >According to the complaint, the acquisition will harm competition in three worldwide markets in which Nvidia competes using Arm-based products: >High-Level Advanced Driver Assistance Systems for passenger cars. These systems offer computer-assisted driving functions, such as automated lane changing, lane keeping, highway entrance and exit, and collision prevention; I wonder if this action is related to the automotive chip shortage concerns in any way.
- rswail 5y ago
  Unlikely, it's more that the vehicle manufacturers would be affected directly if these things became less competitive. Vehicle manufacturers are essentially component assemblers that buy their components at various levels of assembly from 3rd party suppliers. It also is a major US industry so that enables the FTC to describe in the court cases the impact on competition outside of the specific chip design/manufacture industry.
dcow 5y ago
Okay let's assume the worst: Nvidia proves once and for all they're a giant green asshole and squeezes the life out of all existing ARM licensees to the point where they switch to a new ISA or die. What is the value of the investment you just made when nobody cares about ARM anymore? Or, 40 billion to force the market to agree on a new ISA a little sooner than it would have naturally? Smart play. It's nice job security for the engineers that are going to need to port everything, though...
jamesliudotcc 5y ago
Administrative overreach. If the FTC really believed they could win in a regular federal court where they did not hire and fire the judges, they would do so.
porknubbins 5y ago
Going through my stock app the other day I thought Nvidia market cap had to be a typo… since when is a graphics card company one of the biggest companies in the world? 800B is 4x the market cap of Intel, not that far off Apple. How many people realize this?
- sounds 5y ago
  Because the market thinks Nvidia's potential for future earnings is similar to Intel, Apple, and similar tech companies (Microsoft, Amazon, Google, Facebeta or whatever-it-is). While I can guess what the collective market is thinking, it's anybody's guess. If you disagree, then short Nvidia?
  - foepys 5y ago
    That's assuming that the market is always rational. It might be in this case but it not always is. See the more or less recent mortgage crisis for an extreme example. I, for example, don't agree with Tesla's current valuation but I wouldn't be stupid enough to try to compete with Musk's memeing on Twitter.
  - porknubbins 5y ago
    I’m not taking issue with the valuation. I never short tech companies that could have an unpredictable breakthrough success. For all I know they sell millions of GPUs at high prices to justify it. I’m just saying if you asked what are the biggest companies in the world I would never have guessed Nvidia.
  - 1-6 5y ago
    Nvidia has the market cornered but anyone else can do the same thing they’re doing for less. It’s just branding and being first to market at this point.
- dev_tty01 5y ago
  Well, clearly lots of investors are aware of this...
999900000999 5y ago
Does ARM have any real competitors? ARM alone is way too powerful
DeathArrow 5y ago
It's a pity MIPS died as a consequence of Apple killing PowerVR. It could provide some competition to ARM.
- dev_tty01 5y ago
  PowerVR is still around and selling designs, some of which are reportedly still used by Apple. Apple is also still paying licensing fees for PowerVR. MIPS just got long in the tooth and died because the company (Wave Computing) that was licensing MIPS designs just didn't have enough customers. They have now switched to RISC-V.
- fredoralive 5y ago
  MIPS hadn't been providing much competition to ARM[1] in the decade or so leading up the 2016 bust up between Apple and Imagination, so why would it suddenly start doing so after? [1] In general terms, I know it has (had?) a few niches like routers (IIRC).
klelatti 5y ago
One further reason why this takeover is problematic: Nvidia would gain unprecedented information on its competitors businesses. - sales volumes for all arm based products - plans to license arm cores for new designs - some details of new designs - eg possibly process technology etc
Symmetry 5y ago
As an NVidia shareholder let me say thank goodness. NVidia is having to pay more than the market rate for ARM in order to get it from Softbank instead of them just selling ARM on the open market. But because nobody in their right mind would trust NVidia with ARM, ARM under NVidia is going to be worth less than what the market would pay for an independent ARM. And everything NVidia wants to do with ARM they can do by just buying an architectural license like everybody else. The whole deal would have been a huge destruction of value for the sake of Jensen Huang's ego.
kotxig 5y ago
It's easier that the US blocks it for diplomatic reasons than the UK. The UK will almost certainly block it if the US doesn't. It could be interpreted as a snub if the UK interferes with the deal, so the US has first dibs on blocking the merger.
cdbattags 5y ago
If this merger does happen, my hope is RISC-V will win in 5-10+ years horizon. Which I think would be net-net better for the whole industry.
stjohnswarts 5y ago
This is really good news. Nvidia has always been show to be kind of hostile and proprietary and non community friendly as they've gotten larger and larger. It's always good to hear when companies that large get taken down a notch or two. ARM is too important to the broad market to let them merge with a company that will most likely swallow up the IP and limit access to it in an attempt to become hegemonious in the arenas that ARM finds itself in.

722 points by badwolf 5y ago

I don't get the logic. So US government is ok with ARM China getting kidnapped, but has a problem with merge of 2 US companies? https://www.extremetech.com/computing/326447-arm-china-seizes-ip-relaunches-as-an-independent-company https://www.extremetech.com/computing/326447-arm-china-seize...

macintux 5y ago
> So US government is ok with ARM China getting kidnapped Two factors here: ARM isn’t a U.S. company, and neither the U.K. nor U.S. would seem to have a great deal of leverage to bring to bear on the situation, realistically.
- rastapasta42 5y ago
  "No leverage" "Our hands are tied" "The bribe was too large to refuse" Our grand-children will hate us for being cowards and short-sighted profiteers. https://www.wionews.com/world/joe-bidens-son-helped-china-get-control-over-vast-cobalt-mine-in-africa-report-432925 https://www.wionews.com/world/joe-bidens-son-helped-china-ge...

KETpXDDzR 5y ago

I wonder if the "ARM China went rouge" stuff is related. https://news.ycombinator.com/item?id=28329731 https://news.ycombinator.com/item?id=28329731

kwere 5y ago

is softbank (ARM owner) in need of cash?

gjsman-1000 5y ago
I wonder how much a business' valuation is determined by sale potential. If you have a business that is worth a lot, and yet nobody can or will buy it, how much is it really worth? Obviously it's still worth something, it's just that the valuation becomes really fuzzy except for the assets.
- ttt333 5y ago
  Formerly worked in Investment banking: it is a huge huge determinant of value. Particularly for a lower-dividend, higher growth company like Nvidia, the vast majority of the present value comes from the terminal value (what someone else will pay you for it when you're done holding the investment), made even more extreme by low interest rates.
  - richardwhiuk 5y ago
    Couldn't it transform into a high-dividend company?
    - JumpCrisscross 5y ago
      > Couldn't it transform into a high-dividend company? This is cigarette-butt investing. It ignores terminal value. If the terminal value is already close to zero, it's the right move, an orderly wind-down and re-allocation of assets. If there is terminal value, it's a pillaging. Cases like these, where the terminal value starts looking more theoretical than practical, are how those incentives shift.
      - rswail 5y ago
        What happens in the situation where there isn't a "terminal" point for a company? Coca-Cola has no reason to "terminate" itself, so why shouldn't it distribute profit excess to its operating requirements back to shareholders?
        5y ago

gjsman-1000 5y ago

If I was working for Qualcomm... I would say that the FTC suing right now is almost maliciously late. Edit: So much so, that I would almost start my defense with claiming that the FTC's charges are in bad-faith.

bobsmooth 5y ago

I'm conflicted. As an NVDA holder, I'm disappointed. As a tech lover, this is for the best.

Dracophoenix 5y ago
Is it? Nvidia gave plenty of good examples of what it has been able to accomplish with ARM tech in their previous keynotes. If anything, I've come around from thinking this was simply a power play on Nvidia's part, to seeing this merger as a win-win-win for Nvidia, the ARM ISA, and ISA competition as a whole.
- bobsmooth 5y ago
  Whatever neat things Nvidia is doing with ARM can be done with ARM being independent.
  - GhettoComputers 5y ago
    Can you show evidence of this? There has never been a good open ARM processor for mobile computing ever, the Jetson is the best open one while the Apple chips and M1 is the technically best one.
    - bobsmooth 5y ago
      You answered your own question. Nivida doesn't need to own the entirety of the mobile processor market.
      - GhettoComputers 5y ago
        So then they’re no good reason to block it. They would do a better job than it currently it currently is in now, mobile processors aren’t all ARM either.
        mijoharas 5y ago

voz_ 5y ago

This is a good thing, from any way you look. The last thing we need is more consolidation, and less competition, in this space.

gjsman-1000 5y ago
On the other hand, a NVIDIA ARM acquisition could really spark RISC-V adoption. Maybe.
- Alupis 5y ago
  There are very few positive signs Nvidia would be a good caretaker of ARM IP, continue to push new innovated and open designs and mass adoption. Nvidia's entire business and philosophy regarding their chip designs are kind of antithetical to what ARM was achieving.
  - gjsman-1000 5y ago
    All you have to see is NVIDIA's trashy effort on Linux and locking-down what-would-otherwise-be-open hardware from being usable by open-source drivers...
    - GhettoComputers 5y ago
      And ARM had constantly updated Linux kernels and drivers from Qualcomm before didn’t they?
      - monocasa 5y ago
        ARM works very, very closely with the Linux kernel. The issues with updated code in the kernel isn't because of ARM CPU IP.
        rjsw 5y ago
        ARM hasn't been much better than Nvidia for GPU code.

barbacoa 5y ago

It's surprising the US gov would take action to stop this. One one hand yes, this isn't great for the industry. But on the other it would mean that ARM will become an American owned company which gives the US government enormous new tech war leverage against China.

bogwog 5y ago
I wonder if vague fears about China are part of the reason the FTC has been sitting on their ass doing nothing about the tech industry for the past decade+? It would be ironic if true, because their failure to intervene has hurt America's ability to innovate and created opportunities for China.
zarzavat 5y ago
It seems extremely unlikely that the UK will allow this deal anyway so it is somewhat moot what the FTC does. The original ARM sale to Softbank was made while everybody was distracted by Brexit, and is regarded as somewhat of an embarrassment. However Softbank appears to have played themselves because any attempt to sell ARM to a non-British owner will likely be denied as politically unacceptable.
- starfallg 5y ago
  >However Softbank appears to have played themselves because any attempt to sell ARM to a non-British owner will likely be denied as politically unacceptable. Softbank gets to keep a cool $1.25 billion in cash from Nvidia if the deal falls through. It's standard M&A practice and so a win-win situation for them.
  - Qub3d 5y ago
    Is it that general? Its one thing if a deal fails because a party gets cold feet, or can't reach an agreement. Its another if the parties are all agreed and ready and a regulator steps in, isn't it?
- fomine3 5y ago
  The worst thing Softbank did is selling Arm China stock to China local. This is serious failure for western world.

mrlambchop 5y ago

A late, but potentially still well timed event that will tie up the deal through to next summer when the exclusivity period expires and SoftBank gets a 1.25B breakup fee.

KingMachiavelli 5y ago
Is that good? The Nvidia-ARM merger has progressed and been in the news so many times that it's been partly responsible for Nvidia's stock growth. It's a bit strange to correct a market by blocking a merger while choosing to sue at the most disruptive time (correcting/bear-ish turned market, inflation policy changes, very close to the exclusivity period expiration). The FTC should be doing its job but it should be doing it the proper way - not just delaying the deal until it falls apart. It should also do its job promptly... the UK was looking at this deal nearly a year ago - that should have been a huge flag to accelerate their own investigation. What's the point of wasting months of people's time and money.

dcow 5y ago

Strategically, why wouldn’t the US gov’t want a US company owning ARM? Why is the FTC pilling on to block this? How would I, as a consumer, be harmed by a graphics company owning an instruction set and design specification? Stopping two US companies from merging because it would create a monopoly and negatively impact US consumers is one thing. But this isn't even remotely the case here? Doesn't the US government get more tax revenue if Nvidia makes some extra dough charging royalties for that IP? I’m confused.

russellbeattie 5y ago
You're not paying attention if you think Nvidia is just a "graphics company". As a chip supplier they are known to be aggressive to the point of bullying and their negotiations tend towards the extortion end of the business spectrum. I like Nvidia (because I don't have to work with them), but I don't think they are the right steward for ARM in any way.
- dcow 5y ago
  So the headline should read: Nvidia too much of an asshole to own ARM? Let’s update our laws too. I’m serious, if we don’t want companies to be assholes then we’d need to regulate how they negotiate and a lot of other things.
  - effie 5y ago
    Caring only about laws and not about reputation of being a good ecosystem partner to others is a recipe for others to look elsewhere. NVIDIA has a really bad rep due to its arrogant behaviour towards customers and other companies (Linux project, Apple). Maybe this ARM drawn out saga is just karma coming back from that.
    - shrewduser 5y ago
      Nvidia has burned its bridges with a lot of companies over the years (Microsoft comes to mind, i'm pretty sure they will never use an nvidia chip inside an xbox ever again)

shmerl 5y ago

Good. Nvidia is a pretty lock-in oriented and anti-competitive company in general. So them getting ARM would have been bad.

GhettoComputers 5y ago
Any ARM hardware that isn’t? Jetson was way more open compared to all other ARM hardware I know of.
- shmerl 5y ago
  Mots are pretty bad I guess. For example Qualcomm is horrible.
  - GhettoComputers 5y ago
    I’m excited for project mainline from google, maybe they can make a good generic kernel for all ARM processors. https://www.xda-developers.com/android-project-mainline-modules-explanation/ https://www.xda-developers.com/android-project-mainline-modu...
    - shmerl 5y ago
      An improvement for sure if they'll require upstreaming drivers (as in making them FOSS), because Android is causing a rift as long as drivers have blobs due to bionic vs glibc.

nus07 5y ago

https://www.newyorker.com/magazine/2021/12/06/lina-khans-battle-to-rein-in-big-tech https://www.newyorker.com/magazine/2021/12/06/lina-khans-bat... A rather long read but it’s starting to make sense .

2OEH8eoCRo0 5y ago
Came here to post the same thing. Very good read.
- abnercoimbre 5y ago
  I must signal my approval of this piece. They have a great audio narration available for free as well. I'll be following this new FTC closely.

deleted 5y ago

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hn_throwaway_99 5y ago

I think the comments along the lines of "This is weird, why wouldn't the US govt want a US company to own ARM?" are incredibly simplistic. First, it's at least possible that some government agencies actually do care about their charters and don't make it 100% about any one-sided geopolitical advantages. It's not hard to see how this deal will be bad for American consumers and businesses at large, and the FTC's purpose is to prevent that harm. But more than that, even if you do take the position that they only care about realpolitik, the US government's desire to reign in big tech is about the sole thing that has bipartisan support. This action is well in line with keeping big tech from usurping the power of government.

deleted 5y ago
[deleted]
dcow 5y ago
> It's not hard to see how this deal will be bad for American consumers and businesses at large, and the FTC's purpose is to prevent that harm. I am having a hard time understanding this. Care to explain rather than sidestepping and calling out my comment as overly simplistic? It seems the FTC is acting to protect businesses (ironically other big tech), not consumers. That’s what I don’t get. > This action is well in line with keeping big tech from usurping the power of government. “It’s political” isn’t really an explanation either. There’s certainly something to discuss about at what point a company becomes too big and valuable, but that doesn't seem to be the stated motivation here. And I’d be interested in understanding what the framework is for applying those restrictions and how e.g. a company like Apple slid by without getting dismantled. EDIT: To put my confusion another way, at the end it says “The FTC acts when it has reason to believe the law has been or is being violated.” What law has allegedly been violated or would be violated should this merger succeed?
- nnvvhh 5y ago
  One thing the TFA says: "Because Arm’s technology is a critical input that enables competition between Nvidia and its competitors in several markets, the complaint alleges that the proposed merger would give Nvidia the ability and incentive to use its control of this technology to undermine its competitors, reducing competition and ultimately resulting in reduced product quality, reduced innovation, higher prices, and less choice, harming the millions of Americans who benefit from Arm-based products, the complaint alleges." When a downstream firm merges with an upstream supplier that is really important to the downstream firm and its competitors, the merged firm can competitively hobble the downstream competitors. They can refuse to sell the upstream good to competitors, or raise the cost for competitors. Plus it may force the competitors (or potential new entrants) to vertically integrate themselves and enter both the downstream and upstream markets, which chills competition in the downstream market. The government also credits business justifications for the merger, and in the end they balance those with the potential harms to competition. The article (I can't find the complaint) also says, and this is a typical vertical merger concern, that this will give Nvidia (the downstream firm) access to sensitive information of Nvidia's rivals that they had previously shared with Arm. EDIT: There is also a general antitrust push in the Biden administration, notably in the appointments of Lina Khan and Tim Wu. Interesting to see its fruits.

InTheArena 5y ago

Rule of law still matters. It’s interesting to see how differently ARM is treated versus ARM China.

volta83 5y ago

> DPU SmartNICs, Which other companies beyond NVIDIA sell DPUs ?

Zandikar 5y ago
Marvell, Fungible, Broadcom, and Intel (though they may brand them as IPU or something else, they're in the same market/use niche), possibly more.

deleted 5y ago

[deleted]

blablabla123 5y ago

This is the most megalomanic thing I've ever heard of. ARM has high chances to be both the next x86 and the most common embedded architecture. While at the same time Nvidia GPUs are already the de facto standard for GPU computing. So Nvidia would have monopolies in 2 verticals. No reasonable and competent antitrust commission could ever allow that - although probably everyone was betting the latter wasn't the case...

xiphias2 5y ago
I totally agree… what’s interesting is that some of the reasons that FTC provide are totally not what’s interesting (self driving). I have a MacBook Pro with M1 ARM chip, and I love it, it’s extremely power efficient, I don’t really have to think much about charging it. It wouldn’t be possible if NVIDIA could force its chips on Apple.
- effie 5y ago
  How long can you use the M1 laptop on single charge?
  - xiphias2 5y ago
    https://support.apple.com/kb/SP824?locale=en_US https://support.apple.com/kb/SP824?locale=en_US The official number is 17 hours, bu I never had to test it in real life. The crazy thing is charging to 50% in 30 minutes, and 50% is enough to get me through my trips.
    - effie 5y ago
      That's great. Yeah, once the on-battery time is slightly greater than one workday requires, increasing it further stops being interesting. For battery longevity, in general I would charge to 90% and then use it until 20%, then recharge to 90% again. This makes the most out of the battery charge cycles, and avoid the increased stress of close-to-0% charge (bad if there for longer time) and close-to-100% charge (less bad but still better not to go there often). But maybe M1 battery system is different for some reason, I don't know.

mullingitover 5y ago

So what I'm reading is Intel ordered the FTC to dismantle any potential competition.

dang 5y ago
Please don't post unsubstantive/flamebait comments. We're trying for something else on this site. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
- mullingitover 5y ago
  Sorry, I'm expressing my sincere belief that there's real corruption at the upper echelons that's benefitting Intel. I can see how my terse comment would come across as flamebait, it wasn't intentional. Intel's consistently rich margins don't really make sense if we actually have a fair and competitive market.

Bud 5y ago

It's shocking how just four years of Trumpism have made it difficult for Americans to even imagine a US government agency actually doing its job, as it was intended to do. We now just automatically jump to assuming "fuck everything, except making more money and Mercuh". Sad.

krapp 5y ago
> It's shocking how just four years of Trumpism have made it difficult for Americans to even imagine a US government agency actually doing its job, as it was intended to do. It wasn't just four years of Trumpism. Trumpism was simply the fruition of decades of successful neoliberal anti-government propaganda, primarily from the Republicans, going back at least as far as Reagan saying "Government is not the solution to our problem, government is the problem." What Trumpism added was mainstreaming conspiracy theory on top of the general disposition that government should be starved until it was weak enough to be drowned in the bathtub. So now the Libertarians are talking about limited government and how Fauci created COVID for the Illuminati.
genousti 5y ago
Its not Trump that jailed chelsea manning and wage war against assange. Wake up
dang 5y ago
Would you please stop taking HN threads further into flamewar? Discussion quality takes a sharp step down with posts like this. Please make your substantive points without doing that. We detached this subthread from https://news.ycombinator.com/item?id=29423448 https://news.ycombinator.com/item?id=29423448.

gip 5y ago

As a former hardware engineer I support the move by the FTC! I have an honest question though: does the lawsuit have any realistic change to block that merger?

not2b 5y ago
It seems it will at least delay it while the lawyers fight it out in court.
pm90 5y ago
It absolutely does. The FTC doesn’t bring lawsuits forward unless they have pretty good reason to believe they will succeed. I suspect they have been gathering evidence to make this case for a while now.
- scandinavian 5y ago
  Always such a weird argument. I assume Nvidia also doesn't try to aquire large companies unless they have pretty good reason to believe they will succeed.
  - pm90 5y ago
    I dislike even engaging with this kind of lazy reasoning. The offer was made under a different US administration which did not prioritize enforcement of antitrust laws.
    - scandinavian 5y ago
      If you dislike lazy reasoning, why do you post it on HN?
e-_pusher 5y ago
This is an aside but: what made you switch away from hardware engineering? And what are you doing nowadays?

keewee7 5y ago

This might be the geopolitical blunder of the decade. If this merger doesn't happen China is going to win the chip race. As an European I'm increasingly bullish on China and see the US and EU as self-sabotaging neurotic entities.

CameronNemo 5y ago
What is the "chip race" and why is a combined NVIDIA/ARM necessary to "win" it? Aren't AMD/TSMC, Apple/TSMC, and Intel enough to be competitive?
- keewee7 5y ago
  TSMC is Taiwanese, China will takeover Taiwan in the next 5-10 years, and Intel's manufacturing processes are ancient. The future when US/EU can't produce our own chips is rapidly approaching.
  - CameronNemo 5y ago
    And... What do ARM or NVIDIA have anything to do with fabrication? If anything a merger will hurt Intel and make it harder for them to update their processes.
  - unionpivo 5y ago
    You do realize that neither Nvidia nor Arm, have their own foundries and have shown no signs of wanting to build one ? TSMC and Nvidia are not in the same business.
  - rswail 5y ago
    TSMC is building new plant in the US and elsewhere outside of Taiwan. There's no guarantee that Chine will "takeover" Taiwan any time soon, the geo-politics of that are way more enormous than just chip manufacture. Most of the development in manufacturing of chips is by the companies that supply the fab developers, the integration of those skills and components is where the different fab owners have their competitive advantages. The "future when the US/EU can't produce our own chips" was also in the 80s when there was a push to develop memory manufacturers and back then, Japan was the evil empire that needed to be stopped. TSMC would continue post a China takeover of Taiwan.

lr1970 5y ago

Apple, Qualcomm, Intel, AMD probably lobbying FTC against this deal.

tempfs 5y ago
Finally, someone gets it. There is a lot of other well intended, intellectually driven arguments and opinions in this thread, but I am afraid that the people actually making the calls here are mostly likely being guided by their own self interests.
- dcow 5y ago
  No no, this is what I'm trying to get to the bottom of. I don't see any way this is strictly substantially bad for consumers or reduces competition in a way that antitrust law would apply, and I don't see any way this is at all bad for the US strategically. So the FTC is issuing a complaint in response to ..something.. that goes against the interest of our own government and has nothing to do with consumers (hell I'd love to see an Nvidia N2 SoC that competes with the Apple M1). Bingo, it's other big tech firms lobbying. These other big tech firms most certainly have y'alls interest at heart and are just looking out for you, small fry. Give me a break!
  - yehaaa 5y ago
    Nothing is stopping Nvidia from creating a N2 SoC that competes with the Apple M1. They don’t need to own ARM to do that. They can even create their own SOC with a Nvidia GPU.
  - max_ 5y ago
    The point is that this was arbitrary use of power. Not if the intention was good or bad. [0]: https://www.collinsdictionary.com/dictionary/english/arbitrary-power https://www.collinsdictionary.com/dictionary/english/arbitra...
- abnercoimbre 5y ago
  Usually I'd agree, but we're likely wrong on this one. I recommend this New Yorker piece detailing the new FTC [0]. [0] https://www.newyorker.com/magazine/2021/12/06/lina-khans-battle-to-rein-in-big-tech https://www.newyorker.com/magazine/2021/12/06/lina-khans-bat...

nikolay 5y ago

I guess, the government is friends with Apple. The corruption in the US is beyond imagination, just on a totally different level than anywhere else in the world! When iPhone was a monopoly, it was fine. When Facebook is a monopoly, it's fine. When Google is a monopoly, it's fine, but when it comes to more traditional businesses - no, it's not fine as chips can't be used as political tools unlike Apple's, Google's, and Facebook's platforms!

deleted 5y ago
[deleted]
matthewmcg 5y ago
I think you need to recognize that the FTC is governed by its commissioners and chairperson, and those people have their own priorities that are going to be different than their predecessors. Lina Khan, current chair, is much more focused[1] on controlling tech monopolies than Trump’s appointees, who had what you might charitably call more “market oriented” priorities[2] (to me, a euphemism for “bought by big business”). [1]: https://www.newyorker.com/magazine/2021/12/06/lina-khans-battle-to-rein-in-big-tech https://www.newyorker.com/magazine/2021/12/06/lina-khans-bat... [2]: https://www.politico.com/story/2019/05/08/ftc-chairman-congress-rulemaking-authority-1418237 https://www.politico.com/story/2019/05/08/ftc-chairman-congr...
- nikolay 5y ago
  Is there are more a blatant monopoly than Meta? Or Google for search?

usr1106 5y ago

Good that they remember their tasks of enforcing antitrust rules when it comes to mergers. When will they remember them in cases of disruptive growth like Google and Amazon and do AT&T?

varelse 5y ago

Our government continues to show how corrupt and bad it really is. It'll be super funny when Qualcomm buys ARM instead because that's a-okay and all that. Edit: you know Qualcomm has already said that's exactly what they're going to do right? Maybe the Nvidia CEO needs to kill a goat with a stun gun and feed it to the FTC to send the right message? That seemed to work really well for Zuck. https://www.cnbc.com/2021/06/14/qualcomm-offers-to-invest-in-arm-as-regulators-threaten-nvidia-deal.html https://www.cnbc.com/2021/06/14/qualcomm-offers-to-invest-in...

gifnamething 5y ago
>Edit: you know Qualcomm has already said that's exactly what they're going to do right? Well that's not what your link says
- varelse 5y ago
  Okay if you trust that buying an unspecified stake doesn't lead to an acquisition once the smoke has cleared you have a very different worldview than I do. We will have to agree to disagree. It does seem like the next 100 years is just more of what's been going on the past decade and it seems pretty grim for the customer and great for the corporations as they duke it out with each other much like what this seems to really be about.
  - gifnamething 5y ago
    I don't need to trust it, the rules for acquisition are much more strict than the rules for part ownership.
    - varelse 5y ago
      Fascinating... So many strange acquisitions and this is the one that triggers all the red flags. The story will come out eventually and I think it's going to be a doozy.
rswail 5y ago

lvl100 5y ago

This is not material in my view in the sense that it was going to get blocked by EU. And to be perfectly honest, it’s really not Nvidia’s fault that ARM sold out to Softbank, a known player with hard investment return mandates. I am sure Apple gave this a big push along with other players mentioned in comments. As for the validity/veracity of the suit, it’s 50/50.

rswail 5y ago
It's likely to be blocked by the UK first, then potentially the EU, then the FTC. There are plenty of people lining up against NVidia on this.

mercy_dude 5y ago

There goes my NVDA calls. I should have sold when it hit the ATH.

rodmena 5y ago

A big win for consumers.

NortySpock 5y ago

The reason to block the merger is pretty straightforward: 1) Nvidia designs expensive chips and sells them by the millions. [1] 2) ARM designs cheap chips and sells them by the billions. [2] 3) Nvidia's "normal" product departments are incentivized to prevent ARM from competing with Nvidia's expensive chips, in various ways. This would hinder ARM's innovation and growth opportunities vs being independent. I am glad to see this motion to block the merger, for the sake of a competitive market for CPUs, GPUs, etc. [1] https://www.techradar.com/news/nvidia-hits-new-highs-in-gpu-sales-as-ampere-dominates-amd-big-navi https://www.techradar.com/news/nvidia-hits-new-highs-in-gpu-... [2] https://www.tomshardware.com/news/arm-6-7-billion-chips-per-quarter https://www.tomshardware.com/news/arm-6-7-billion-chips-per-...

dcow 5y ago
ARM doesn't sell chips. They license the instruction set. Ask Apple or Qualcomm if the final ARM SOCs they build and sell are cheap...
- kadoban 5y ago
  I don't see that that really changes anything here.
  - dcow 5y ago
    Well the argument is that ARM is cheap and good for consumers because it's cheap. I wanted to make it clear that you can't go to ARM and buy <cheap arm chip>. You have to go to Qualcomm or Apple or Broadcom and buy <not quite so cheap arm chip>. So that kinda impacts the argument. Whatever Nvidia wants to do with licensing they have to combat market forces already in play. There's a market for somewhat less expensive arm chips, for one, so they'd lose that revenue. Two, if they want to royally fuck arm shops and become the only ARM vendor, well, good luck... you just killed the ISA you bought for 40 billion...
    - throwaway2048 5y ago
      40 billion isn't much to sabotage the vast majority of your competitors

emodendroket 5y ago

The idea that you can possibly have a bunch of small companies competing in the modern semiconductor space is risible. If a big private concern makes you feel bad you could think about bringing the government into it but I see little other way forward.

DarkmSparks 5y ago

I was pretty skeptical on attempts to block this merger, still am tbh. But I'm also very happy this is going to get the scrutiny it needs, both nvidia and arm are pretty vital to the tech industry right now, I can see it going either way, ARM needs better GPU patents, NV needs better SOC patents, the risk of a merger being a disaster is pretty high.

fennecfoxen 5y ago
> ARM needs better GPU patents Remember also that "GPU" technology is not strictly about graphics. If you browse the marketing website, listen to the keynotes, and generally learn of the NVIDIA vision of the future, it is something like this. There will be tons of little robots and similar endpoints ("edge computing"). Such a robot will be powered by a little ARM chip with an NVIDIA coprocessor for its on-board AI (computer vision, mobility, and the like). The robot will talk over 5G or one of its successors — the signal processing for the base station perhaps powered by something like NVIDIA AI-on-5G. This communication link will connect it with compute appliances in the nearest utility closet or server room, wherein NVIDIA simulation and route-planning software maintains a "digital twin" of the real world, and helps orchestrate their operations, while operators can render that model on their local machines. And all these devices will have computer-vision and route-planning models on board, models that are trained in the big machines in the datacenter. We have a few of these systems in computing today, but AI coprocessors will become very interesting as we move deeper into this world.
- erikpukinskis 5y ago
  > Remember also that "GPU" technology is not strictly about graphics. It’s not even primarily about graphics anymore. Graphics seem to be the 2nd if not 3rd most common use for GPUs.

COGlory 5y ago

The FTC mentioned chips in vehicles multiple times. >The FTC’s complaint alleges that the combined firm would have the means and incentive to stifle innovative next-generation technologies, including those used to run datacenters and driver-assistance systems in cars. and here: >According to the complaint, the acquisition will harm competition in three worldwide markets in which Nvidia competes using Arm-based products: >High-Level Advanced Driver Assistance Systems for passenger cars. These systems offer computer-assisted driving functions, such as automated lane changing, lane keeping, highway entrance and exit, and collision prevention; I wonder if this action is related to the automotive chip shortage concerns in any way.

rswail 5y ago
Unlikely, it's more that the vehicle manufacturers would be affected directly if these things became less competitive. Vehicle manufacturers are essentially component assemblers that buy their components at various levels of assembly from 3rd party suppliers. It also is a major US industry so that enables the FTC to describe in the court cases the impact on competition outside of the specific chip design/manufacture industry.

dcow 5y ago

Okay let's assume the worst: Nvidia proves once and for all they're a giant green asshole and squeezes the life out of all existing ARM licensees to the point where they switch to a new ISA or die. What is the value of the investment you just made when nobody cares about ARM anymore? Or, 40 billion to force the market to agree on a new ISA a little sooner than it would have naturally? Smart play. It's nice job security for the engineers that are going to need to port everything, though...

jamesliudotcc 5y ago

Administrative overreach. If the FTC really believed they could win in a regular federal court where they did not hire and fire the judges, they would do so.

porknubbins 5y ago

Going through my stock app the other day I thought Nvidia market cap had to be a typo… since when is a graphics card company one of the biggest companies in the world? 800B is 4x the market cap of Intel, not that far off Apple. How many people realize this?

sounds 5y ago
Because the market thinks Nvidia's potential for future earnings is similar to Intel, Apple, and similar tech companies (Microsoft, Amazon, Google, Facebeta or whatever-it-is). While I can guess what the collective market is thinking, it's anybody's guess. If you disagree, then short Nvidia?
- foepys 5y ago
  That's assuming that the market is always rational. It might be in this case but it not always is. See the more or less recent mortgage crisis for an extreme example. I, for example, don't agree with Tesla's current valuation but I wouldn't be stupid enough to try to compete with Musk's memeing on Twitter.
- porknubbins 5y ago
  I’m not taking issue with the valuation. I never short tech companies that could have an unpredictable breakthrough success. For all I know they sell millions of GPUs at high prices to justify it. I’m just saying if you asked what are the biggest companies in the world I would never have guessed Nvidia.
- 1-6 5y ago
  Nvidia has the market cornered but anyone else can do the same thing they’re doing for less. It’s just branding and being first to market at this point.
dev_tty01 5y ago
Well, clearly lots of investors are aware of this...

999900000999 5y ago

Does ARM have any real competitors? ARM alone is way too powerful

DeathArrow 5y ago

It's a pity MIPS died as a consequence of Apple killing PowerVR. It could provide some competition to ARM.

dev_tty01 5y ago
PowerVR is still around and selling designs, some of which are reportedly still used by Apple. Apple is also still paying licensing fees for PowerVR. MIPS just got long in the tooth and died because the company (Wave Computing) that was licensing MIPS designs just didn't have enough customers. They have now switched to RISC-V.
fredoralive 5y ago
MIPS hadn't been providing much competition to ARM[1] in the decade or so leading up the 2016 bust up between Apple and Imagination, so why would it suddenly start doing so after? [1] In general terms, I know it has (had?) a few niches like routers (IIRC).

klelatti 5y ago

One further reason why this takeover is problematic: Nvidia would gain unprecedented information on its competitors businesses. - sales volumes for all arm based products - plans to license arm cores for new designs - some details of new designs - eg possibly process technology etc

Symmetry 5y ago

As an NVidia shareholder let me say thank goodness. NVidia is having to pay more than the market rate for ARM in order to get it from Softbank instead of them just selling ARM on the open market. But because nobody in their right mind would trust NVidia with ARM, ARM under NVidia is going to be worth less than what the market would pay for an independent ARM. And everything NVidia wants to do with ARM they can do by just buying an architectural license like everybody else. The whole deal would have been a huge destruction of value for the sake of Jensen Huang's ego.

kotxig 5y ago

It's easier that the US blocks it for diplomatic reasons than the UK. The UK will almost certainly block it if the US doesn't. It could be interpreted as a snub if the UK interferes with the deal, so the US has first dibs on blocking the merger.

cdbattags 5y ago

If this merger does happen, my hope is RISC-V will win in 5-10+ years horizon. Which I think would be net-net better for the whole industry.

stjohnswarts 5y ago

This is really good news. Nvidia has always been show to be kind of hostile and proprietary and non community friendly as they've gotten larger and larger. It's always good to hear when companies that large get taken down a notch or two. ARM is too important to the broad market to let them merge with a company that will most likely swallow up the IP and limit access to it in an attempt to become hegemonious in the arenas that ARM finds itself in.