10 ms·

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 graph

by 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)
      - cwizou 5y ago
        For many different reasons too ! Some were a bit petty/misguided : - Microsoft was mostly contractual on the Xbox, Nvidia didn't want to lower the price of the chips over the lifespan of the 1st Xbox which was a huge no-no. And some technical people also had a terrible experience (some people in the DirectX team had strong thoughts about working with Nvidia). - Sony was mostly about terrible tech support and not wanting to share enough technical details which hampered AAA devs a whole lot, to the point most ended up using the SPUs in very creative (and technically fascinating) ways to compensate (the GTA V engine on PS3 was truly impressive in that regard). - There were some minor (but acrimonious) back and forth with Apple over a failing gen of GPUs (G80s if memory serves), but the large fallout came for the same reason as for the rest of the mobile industry : the Kepler licensing initiative. Long story short, Nvidia tried to assert patents on mobile GPU (ala Microsoft on Android, as a way to "sell" their exit of the mobile market to investors). They then sued Samsung and Qualcomm [1]. Samsung countersued Nvidia, which had to settle as Samsung was close to winning a ban on imports from some Nvidia products [2]. Many of the patents Nvidia tried to assert were thrown out and they had a terrible legal time. The damage that ill thought strategy did to Nvidia is hard to measure but there's not a single mobile company that wanted that acquisition to go forward and many are probably quite relieved after this. [1] : https://www.zdnet.com/article/nvidia-launches-patent-suit-against-qualcomm-samsung/ https://www.zdnet.com/article/nvidia-launches-patent-suit-ag... [2] : https://www.reuters.com/article/us-nvidia-samsung-elec-idUSKCN0XT1QO https://www.reuters.com/article/us-nvidia-samsung-elec-idUSK...
      - spacedcowboy 5y ago
        Apple too. There's a reason it was, in recent memory, intel embedded graphics or an AMD mobile GPU in the portables. Not going to be a thing going forward, of course. The M1 (next seems to be M3 at 3nm ?) will handle the GPU from here on out
  - rswail 5y ago
    Companies are sociopaths by definition. You can't stop them being assholes, what you can do is regulate their asshole-ness so that it minimizes that effect on consumers and markets in general. "Free trade" and "Free markets" has never meant "totally unregulated". That's completely flawed reasoning that ignores the actual purpose of those things, which is to encourage increased/better supply of products and services to consumers at the best possible price.
ninth_ant 5y ago
The press release directly and prominently answers this question multiple times. It suggests that under Nvidia the new Arm would be disincentived to innovate in any area that negatively affects Nvidia businesses. Given that Arm is a critical supplier for many industries, this could result in consumer harm via “reduced product quality, reduced innovation, higher prices, and less choice” Also, I don’t believe the FTC mission is to increase US tax revenue, so that aspect seems irrelevant.
- dcow 5y ago
  And why is SoftBank any more positioned to be a champion of ARM quality? I just don’t see how it would not be in Nvidia’s interest to promote a healthy ARM any more or less than any other owner. Is the goal for ARM to become independent again? Are Nvidia’s competitors making ARM graphics cards and SoCs?
  - bobsmooth 5y ago
    AMD decides it wants to make something like the TX1. Do you think that could happen if Big N owned ARM? Would the M1 series have progressed as quickly knowing the bad blood between Apple and Nvidia? Softbank probably isn't the best management but its neutral.
    - GhettoComputers 5y ago
      Yes to both, if it’s not competitive they’ll use RISC-V or another architecture.
      - dralley 5y ago
        Changing architectures is no small thing regardless of how many times Apple has done it.
        GhettoComputers 5y ago
        You’re right. I don’t even count the new M1 as an architecture change, they switched to mobile like how C2D came from pentium M, their software market in ARM was already mature and it would be significantly harder. At the same time, they made Rosetta and switched to x68 and ARM around the same time, only ARM won.
JumpCrisscross 5y ago
> why wouldn’t the US gov’t want a US company owning ARM? Why is the FTC pilling on to block this? The U.S. government isn't a monolith. FTC is charged with, first and foremost, maintaining our markets.
- romwell 5y ago
  Also to add: Allowing nVidia to become a monopoly would bite the US in the ass strategically, as nVidia loses incentive to innovate. That's how the US, effectively, ended up having no viable aircraft when it entered WWI, after being the country that invented the thing. (Wright and Curtiss, IIRC, locked the market with patents). Or, more closely, how the US telecom/Internet infrastructure is atrocious, despite — and because of — the Internet and the telephone being invented here. Go figure, Ma Bell wasn't the bees knees. Strategically, the US needs someone to keep nVidia up on their toes. Innovation cuts into profit margins when you have a monopoly.
  - GhettoComputers 5y ago
    Ma Bell made some great innovations here and started a lot of the computers tech, after it was destroyed the baby bells combined again, Cingular has exclusive rights to iPhone at a time. Nvidia is reasltically already a monopoly with CUDA. They don’t need to innovate and they force universities to use their more expensive GPUs.
    - JumpCrisscross 5y ago
      > Cingular has exclusive rights to iPhone at a time But not the other baby bells, which is the point. Also, Apple went to Cingular after being rebuffed by Verizon. (Apple wanted no crapware. Verizon said no.) Competition working.
    - romwell 5y ago
      Is your point that monopolies aren't bad, or that anti-monopoly laws are useless? Because both of these are provably false. As is that nVidia is already a monopoly.
gofigure 5y ago
Politically, 'big tech' is on the defensive and this is one way for FTC to show some teeth. That being said, nVidia is currently not playing in ARM's space, so it's hard to argue that this acquisition will harm US consumers or raise prices for them. Hence my feeling is that this is politically motivated, at least to some extent. Also, we (the US) are entering a period of intense competition with China that may last decades and may even include acts of war. Semiconductors are a key area of competition. More US control of key semiconductor assets is in the US interest. However to be totally fair that doesn't typically concern anti-trust law. But it should concern the current administration and drive some of these decisions about where to focus. It would be very different if this was about social networks and funny cat gifs.
- tw04 5y ago
  > That being said, nVidia is currently not playing in ARM's space, so it's hard to argue that this acquisition will harm US consumers or raise prices for them. Hence my feeling is that this is politically motivated, at least to some extent. Huh? They currently use arm designs in the Nintendo switch and their own shield line. They also utilize them in their mellanox Ethernet adapters and network switches. What makes you believe that won't give them a reason to increase prices for competitors that also use ARM chips, if not outright refuse to grant them a license?
- d110af5ccf 5y ago
  > nVidia is currently not playing in ARM's space Look who ARM licenses to and what sort of products those clients manufacture. They are in direct competition right now in a number of areas.
_qswe 5y ago
That was my exact reaction. I'm not sure how much I like Nvidia acquiring Arm, but on some level as an American my instinct is to encourage it. If it is the FTC's actual position that the deal would harm consumers or the industry as a whole, it's certainly admirable that they would ostensibly prioritize that over US strategic interests. This makes me wonder if their analysis shows that the merger would do sufficient harm within the industry as to actually run counter to US interests. If ARM is shaping up to become a pillar of the Western world/economy while China and its sphere of influence consolidate around RISC-V, then anything that harms Arm's market position is also a geopolitical risk to the West. The US government pushing for such a merger, at a time when China is investing heavily in semiconductor manufacturing capabilities while eyeing a conquest of Taiwan/TSMC, would therefore be shooting itself in the foot. Better to grow the pie than risk blowing it up for a slightly larger slice.
- not2b 5y ago
  I don't think it's the US strategic interest for Nvidia to own ARM. International corporations don't have any particular loyalty to the country where their corporate HQ is located, and fewer semiconductor companies just mean higher prices and fewer choices. Also the acquisition would accelerate movement by Nvidia's competitors away from ARM. The only pie that is grown by merging two successful companies is the wealth of the stockholders, everyone else is worse off.
  - stjohnswarts 5y ago
    Looking at this from the perspective of a US citizen I see it as a very bad merger and I'm glad they're suing to stop it. We need more competition not less. Nvidia doesn't exactly have the best record in serving the public.
- ClumsyPilot 5y ago
  "then anything that harms Arm's market position is also a geopolitical risk to the West" This is some seriously flawed thinking extremely convenient for corporate interests. Mixing up marlets with national security leads to the kind of atrocities that make totalitarian states proud. "Coca-Cola Co.'s Colombian bottlers are working with death squads to kill, threaten and intimidate plant workers,"
mywittyname 5y ago
Their argument seems to largely be that ARM does not produce chips directly, but instead licenses designs to other firms using a "neutral, open licensing approach." They feel that this will stop should Nvidia acquire ARM. The also FTC contends that ARM induces competitive behavior in Nvidia. And a merger would stifle that competition. Additionally, and probably most importantly, the FTC contends that Nvidia's competition shares sensitive information with ARM. And part of what Nvidia is looking for with this acquisition is this information. I suspect this is the true reason behind the lawsuit; there's probably a good bit of industry support behind it. Personally, I'd rather ARM be owned by a massive American firm. And out of all the American firms who would be interested in ARM, Nvidia is the most likely to continue to innovate, rather than merely engage in rent seeking behavior.
- rswail 5y ago
  Why would you want ARM owned by a "massive" American firm. Is there one that you would trust to keep the evolution of ARM IP at the same rate, while also offering IPRs (ie licensing etc) in a way that continues to encourage innovation in the use and evolution of that IP? Massive firms are not an inherent Good Thing. There are some benefits due to their ability to invest, but there are also multiple downsides to conglomerates, particularly in strategically vital industries and areas.
  - mywittyname 5y ago
    Well, it's not that I want it owned by a massive firm, but the fact is that only an extremely large company would be in a position to buy it. I was primarily pointing out that, I'd personally favor it being owned by an American company, because the most obvious alternative is a Chinese one. I can't think of many British/European technology companies who could afford ARM and could justify the price premium. The alternative would be to go public again. But I think the temptation is too great, and some massive company would take it over. ARM is the kind of company which is much more valuable as a part of a conglomerate than it is as an independent company.
wahern 5y ago
> Strategically, why wouldn’t the US gov’t want a US company owning ARM It's worth noting ARM Ltd is a British company currently owned by a Japanese company. The U.K. and Japan are two of the closest, if not the closest, defense and industrial partners the U.S. enjoys. And unlike many U.S. allies, they're more-or-less close by choice. IOW, there's a deep reservoir of trust across the spectrum--military, legal, political. Both the U.K. and Japan tend to exercise their independence far more freely than other U.S. allies precisely because of the mutual respect afforded among the three. There's much less tension and apprehension among those three than as between, say, the U.S. and France. A critical supplier like ARM being in the hands of the U.K. and/or Japan is good enough from the perspective of the U.S., absent some extraordinary complicating context.
- Terry_Roll 5y ago
  You dont think this had anything to do with it then? ;-) "When Britain Nuked America....Twice!" https://www.youtube.com/watch?v=-Wx6npt421c https://www.youtube.com/watch?v=-Wx6npt421c And this? "U.S. satellites are being attacked every day according to Space Force general (thedrive.com)" https://news.ycombinator.com/item?id=29402923 https://news.ycombinator.com/item?id=29402923 I think its a good decision because just being dominated by US tech companies can be demoralising, besides no one has a monopoly on ideas or innovation which all develops at different rates. And if ARM did get bought up, would this also drive other countries towards China who are developing their own CPU's? "How China plans to lead the computer chip industry" https://www.bbc.co.uk/news/business-50287485 https://www.bbc.co.uk/news/business-50287485 From a US Military perspective, you don't want to pee off your military assets/partners do you?
  - chrisjc 5y ago
    Wow, fascinating video.
theduder99 5y ago
anything that would improve the US this admin does the opposite 90% of the time. look at the remain in mexico thing which was done away with and now after the epic border fail is going to be stood up again.
mminer237 5y ago
The risk is that Nvidia could produce ARM chips themselves without having to pay money while raising the rates on other companies. This could create an unfair advantage for Nvidia and allow them to charge consumers above-current-market rates on ARM chips.
shrewduser 5y ago
how many US companies rely on ARM being a neutral party though? while you might win a little on one side of the ledger how much would you lose on the other?
emodendroket 5y ago
People have gotten really into the idea of antitrust without really thinking about what problems "trust-busting" was meant to address or whether it's relevant to the ones they have now. Well, I guess half-baked nostalgia is all the rage these days.
- stjohnswarts 5y ago
  Or others have bought into lassezfaire capitalism to such an extent that they think large companies are amoral entities and therefore get a free pass to do whatever the want and grow larger and larger engulfing and eliminating competition.
- makeitdouble 5y ago
  Looking at your other replies your argument seems to boil down to “reasearch needs all the money in the world, consolidation helps with money”, but don’t really address where you think that money will come from, and for what value delivered. The main concern voiced here is that Nvidia-Arm could get away will less research while earning more money. That’s basically what happened when Wintel was at peak and there was no viable alternative to Intel chips. They didn’t bring incredible innovation from the ungodly amount of money they gained; they just crushed all their other competitors through various means, got sued, and still made the field plateau for a decade or so before we saw real innovation.
  - emodendroket 5y ago
    Isn’t it the actual state of play though? At more and more levels there are only one or two players — e.g., ASML, Samsung/TSMC, AMD/Intel, etc. There are lots of others around but they’ve written off cutting-edge business. That’s even though there are a number of exciting developments in hardware going on. I just think the barrier to entry has grown so large that it’s difficult to avoid.
    - makeitdouble 5y ago
      Right now, regarding CPUs we have: - Intel - AMD - Apple - Qualcomm Any of them is pushing the enveloppe in some way or form, I’d argue they are “cutting-edge”
scotty79 5y ago
Maybe they recognize global nature of this issue since Earth has just one Arm, and if it is damaged all people on Earth will be disadvantaged, including Americans, who, even though some of them don't recognize that, live on Earth not planet America.
garmaine 5y ago
> Doesn't the US government get more tax revenue if Nvidia makes some extra dough charging royalties for that IP? I’m confused. Maximizing tax revenues is not the FTC’s job.
rastapasta42 5y ago
The strategy is for the rich and powerful to sell out this country piece by piece, starting with Hunter Biden's Cobalt mine deal: 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... Great way to cause a chip crises and kill our car industry, but if they keep going at this pace, soon there won't be anything left to sell. https://www.extremetech.com/computing/326447-arm-china-seizes-ip-relaunches-as-an-independent-company https://www.extremetech.com/computing/326447-arm-china-seize...
bboreham 5y ago
> Doesn't the US government get more tax revenue As a frequently observed phenomenon, no. The intellectual property and brand which generate revenue for ARM will be held in some other country, so profits can be directed there and no tax payable in the USA.
stjohnswarts 5y ago
Because it has an extremely HIGH probability of Nvidia being hostile and blocking other companies from getting new or relicensing old licenses. Nvidia is big enough and powerful enough as it is whatever country it is based out of. ARM is much better placed as being independent in the market and not owned by an 800lb gorilla like nvidia.

by dcow 5y ago

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)
    - cwizou 5y ago
      For many different reasons too ! Some were a bit petty/misguided : - Microsoft was mostly contractual on the Xbox, Nvidia didn't want to lower the price of the chips over the lifespan of the 1st Xbox which was a huge no-no. And some technical people also had a terrible experience (some people in the DirectX team had strong thoughts about working with Nvidia). - Sony was mostly about terrible tech support and not wanting to share enough technical details which hampered AAA devs a whole lot, to the point most ended up using the SPUs in very creative (and technically fascinating) ways to compensate (the GTA V engine on PS3 was truly impressive in that regard). - There were some minor (but acrimonious) back and forth with Apple over a failing gen of GPUs (G80s if memory serves), but the large fallout came for the same reason as for the rest of the mobile industry : the Kepler licensing initiative. Long story short, Nvidia tried to assert patents on mobile GPU (ala Microsoft on Android, as a way to "sell" their exit of the mobile market to investors). They then sued Samsung and Qualcomm [1]. Samsung countersued Nvidia, which had to settle as Samsung was close to winning a ban on imports from some Nvidia products [2]. Many of the patents Nvidia tried to assert were thrown out and they had a terrible legal time. The damage that ill thought strategy did to Nvidia is hard to measure but there's not a single mobile company that wanted that acquisition to go forward and many are probably quite relieved after this. [1] : https://www.zdnet.com/article/nvidia-launches-patent-suit-against-qualcomm-samsung/ https://www.zdnet.com/article/nvidia-launches-patent-suit-ag... [2] : https://www.reuters.com/article/us-nvidia-samsung-elec-idUSKCN0XT1QO https://www.reuters.com/article/us-nvidia-samsung-elec-idUSK...
    - spacedcowboy 5y ago
      Apple too. There's a reason it was, in recent memory, intel embedded graphics or an AMD mobile GPU in the portables. Not going to be a thing going forward, of course. The M1 (next seems to be M3 at 3nm ?) will handle the GPU from here on out
- rswail 5y ago
  Companies are sociopaths by definition. You can't stop them being assholes, what you can do is regulate their asshole-ness so that it minimizes that effect on consumers and markets in general. "Free trade" and "Free markets" has never meant "totally unregulated". That's completely flawed reasoning that ignores the actual purpose of those things, which is to encourage increased/better supply of products and services to consumers at the best possible price.

ninth_ant 5y ago

The press release directly and prominently answers this question multiple times. It suggests that under Nvidia the new Arm would be disincentived to innovate in any area that negatively affects Nvidia businesses. Given that Arm is a critical supplier for many industries, this could result in consumer harm via “reduced product quality, reduced innovation, higher prices, and less choice” Also, I don’t believe the FTC mission is to increase US tax revenue, so that aspect seems irrelevant.

dcow 5y ago
And why is SoftBank any more positioned to be a champion of ARM quality? I just don’t see how it would not be in Nvidia’s interest to promote a healthy ARM any more or less than any other owner. Is the goal for ARM to become independent again? Are Nvidia’s competitors making ARM graphics cards and SoCs?
- bobsmooth 5y ago
  AMD decides it wants to make something like the TX1. Do you think that could happen if Big N owned ARM? Would the M1 series have progressed as quickly knowing the bad blood between Apple and Nvidia? Softbank probably isn't the best management but its neutral.
  - GhettoComputers 5y ago
    Yes to both, if it’s not competitive they’ll use RISC-V or another architecture.
    - dralley 5y ago
      Changing architectures is no small thing regardless of how many times Apple has done it.
      - GhettoComputers 5y ago
        You’re right. I don’t even count the new M1 as an architecture change, they switched to mobile like how C2D came from pentium M, their software market in ARM was already mature and it would be significantly harder. At the same time, they made Rosetta and switched to x68 and ARM around the same time, only ARM won.

JumpCrisscross 5y ago

> why wouldn’t the US gov’t want a US company owning ARM? Why is the FTC pilling on to block this? The U.S. government isn't a monolith. FTC is charged with, first and foremost, maintaining our markets.

romwell 5y ago
Also to add: Allowing nVidia to become a monopoly would bite the US in the ass strategically, as nVidia loses incentive to innovate. That's how the US, effectively, ended up having no viable aircraft when it entered WWI, after being the country that invented the thing. (Wright and Curtiss, IIRC, locked the market with patents). Or, more closely, how the US telecom/Internet infrastructure is atrocious, despite — and because of — the Internet and the telephone being invented here. Go figure, Ma Bell wasn't the bees knees. Strategically, the US needs someone to keep nVidia up on their toes. Innovation cuts into profit margins when you have a monopoly.
- GhettoComputers 5y ago
  Ma Bell made some great innovations here and started a lot of the computers tech, after it was destroyed the baby bells combined again, Cingular has exclusive rights to iPhone at a time. Nvidia is reasltically already a monopoly with CUDA. They don’t need to innovate and they force universities to use their more expensive GPUs.
  - JumpCrisscross 5y ago
    > Cingular has exclusive rights to iPhone at a time But not the other baby bells, which is the point. Also, Apple went to Cingular after being rebuffed by Verizon. (Apple wanted no crapware. Verizon said no.) Competition working.
  - romwell 5y ago
    Is your point that monopolies aren't bad, or that anti-monopoly laws are useless? Because both of these are provably false. As is that nVidia is already a monopoly.

gofigure 5y ago

Politically, 'big tech' is on the defensive and this is one way for FTC to show some teeth. That being said, nVidia is currently not playing in ARM's space, so it's hard to argue that this acquisition will harm US consumers or raise prices for them. Hence my feeling is that this is politically motivated, at least to some extent. Also, we (the US) are entering a period of intense competition with China that may last decades and may even include acts of war. Semiconductors are a key area of competition. More US control of key semiconductor assets is in the US interest. However to be totally fair that doesn't typically concern anti-trust law. But it should concern the current administration and drive some of these decisions about where to focus. It would be very different if this was about social networks and funny cat gifs.

tw04 5y ago
> That being said, nVidia is currently not playing in ARM's space, so it's hard to argue that this acquisition will harm US consumers or raise prices for them. Hence my feeling is that this is politically motivated, at least to some extent. Huh? They currently use arm designs in the Nintendo switch and their own shield line. They also utilize them in their mellanox Ethernet adapters and network switches. What makes you believe that won't give them a reason to increase prices for competitors that also use ARM chips, if not outright refuse to grant them a license?
d110af5ccf 5y ago
> nVidia is currently not playing in ARM's space Look who ARM licenses to and what sort of products those clients manufacture. They are in direct competition right now in a number of areas.

_qswe 5y ago

That was my exact reaction. I'm not sure how much I like Nvidia acquiring Arm, but on some level as an American my instinct is to encourage it. If it is the FTC's actual position that the deal would harm consumers or the industry as a whole, it's certainly admirable that they would ostensibly prioritize that over US strategic interests. This makes me wonder if their analysis shows that the merger would do sufficient harm within the industry as to actually run counter to US interests. If ARM is shaping up to become a pillar of the Western world/economy while China and its sphere of influence consolidate around RISC-V, then anything that harms Arm's market position is also a geopolitical risk to the West. The US government pushing for such a merger, at a time when China is investing heavily in semiconductor manufacturing capabilities while eyeing a conquest of Taiwan/TSMC, would therefore be shooting itself in the foot. Better to grow the pie than risk blowing it up for a slightly larger slice.

not2b 5y ago
I don't think it's the US strategic interest for Nvidia to own ARM. International corporations don't have any particular loyalty to the country where their corporate HQ is located, and fewer semiconductor companies just mean higher prices and fewer choices. Also the acquisition would accelerate movement by Nvidia's competitors away from ARM. The only pie that is grown by merging two successful companies is the wealth of the stockholders, everyone else is worse off.
- stjohnswarts 5y ago
  Looking at this from the perspective of a US citizen I see it as a very bad merger and I'm glad they're suing to stop it. We need more competition not less. Nvidia doesn't exactly have the best record in serving the public.
ClumsyPilot 5y ago
"then anything that harms Arm's market position is also a geopolitical risk to the West" This is some seriously flawed thinking extremely convenient for corporate interests. Mixing up marlets with national security leads to the kind of atrocities that make totalitarian states proud. "Coca-Cola Co.'s Colombian bottlers are working with death squads to kill, threaten and intimidate plant workers,"

mywittyname 5y ago

Their argument seems to largely be that ARM does not produce chips directly, but instead licenses designs to other firms using a "neutral, open licensing approach." They feel that this will stop should Nvidia acquire ARM. The also FTC contends that ARM induces competitive behavior in Nvidia. And a merger would stifle that competition. Additionally, and probably most importantly, the FTC contends that Nvidia's competition shares sensitive information with ARM. And part of what Nvidia is looking for with this acquisition is this information. I suspect this is the true reason behind the lawsuit; there's probably a good bit of industry support behind it. Personally, I'd rather ARM be owned by a massive American firm. And out of all the American firms who would be interested in ARM, Nvidia is the most likely to continue to innovate, rather than merely engage in rent seeking behavior.

rswail 5y ago
Why would you want ARM owned by a "massive" American firm. Is there one that you would trust to keep the evolution of ARM IP at the same rate, while also offering IPRs (ie licensing etc) in a way that continues to encourage innovation in the use and evolution of that IP? Massive firms are not an inherent Good Thing. There are some benefits due to their ability to invest, but there are also multiple downsides to conglomerates, particularly in strategically vital industries and areas.
- mywittyname 5y ago
  Well, it's not that I want it owned by a massive firm, but the fact is that only an extremely large company would be in a position to buy it. I was primarily pointing out that, I'd personally favor it being owned by an American company, because the most obvious alternative is a Chinese one. I can't think of many British/European technology companies who could afford ARM and could justify the price premium. The alternative would be to go public again. But I think the temptation is too great, and some massive company would take it over. ARM is the kind of company which is much more valuable as a part of a conglomerate than it is as an independent company.

wahern 5y ago

> Strategically, why wouldn’t the US gov’t want a US company owning ARM It's worth noting ARM Ltd is a British company currently owned by a Japanese company. The U.K. and Japan are two of the closest, if not the closest, defense and industrial partners the U.S. enjoys. And unlike many U.S. allies, they're more-or-less close by choice. IOW, there's a deep reservoir of trust across the spectrum--military, legal, political. Both the U.K. and Japan tend to exercise their independence far more freely than other U.S. allies precisely because of the mutual respect afforded among the three. There's much less tension and apprehension among those three than as between, say, the U.S. and France. A critical supplier like ARM being in the hands of the U.K. and/or Japan is good enough from the perspective of the U.S., absent some extraordinary complicating context.

Terry_Roll 5y ago
You dont think this had anything to do with it then? ;-) "When Britain Nuked America....Twice!" https://www.youtube.com/watch?v=-Wx6npt421c https://www.youtube.com/watch?v=-Wx6npt421c And this? "U.S. satellites are being attacked every day according to Space Force general (thedrive.com)" https://news.ycombinator.com/item?id=29402923 https://news.ycombinator.com/item?id=29402923 I think its a good decision because just being dominated by US tech companies can be demoralising, besides no one has a monopoly on ideas or innovation which all develops at different rates. And if ARM did get bought up, would this also drive other countries towards China who are developing their own CPU's? "How China plans to lead the computer chip industry" https://www.bbc.co.uk/news/business-50287485 https://www.bbc.co.uk/news/business-50287485 From a US Military perspective, you don't want to pee off your military assets/partners do you?
- chrisjc 5y ago
  Wow, fascinating video.

theduder99 5y ago

anything that would improve the US this admin does the opposite 90% of the time. look at the remain in mexico thing which was done away with and now after the epic border fail is going to be stood up again.

mminer237 5y ago

The risk is that Nvidia could produce ARM chips themselves without having to pay money while raising the rates on other companies. This could create an unfair advantage for Nvidia and allow them to charge consumers above-current-market rates on ARM chips.

shrewduser 5y ago

how many US companies rely on ARM being a neutral party though? while you might win a little on one side of the ledger how much would you lose on the other?

emodendroket 5y ago

People have gotten really into the idea of antitrust without really thinking about what problems "trust-busting" was meant to address or whether it's relevant to the ones they have now. Well, I guess half-baked nostalgia is all the rage these days.

stjohnswarts 5y ago
Or others have bought into lassezfaire capitalism to such an extent that they think large companies are amoral entities and therefore get a free pass to do whatever the want and grow larger and larger engulfing and eliminating competition.
makeitdouble 5y ago
Looking at your other replies your argument seems to boil down to “reasearch needs all the money in the world, consolidation helps with money”, but don’t really address where you think that money will come from, and for what value delivered. The main concern voiced here is that Nvidia-Arm could get away will less research while earning more money. That’s basically what happened when Wintel was at peak and there was no viable alternative to Intel chips. They didn’t bring incredible innovation from the ungodly amount of money they gained; they just crushed all their other competitors through various means, got sued, and still made the field plateau for a decade or so before we saw real innovation.
- emodendroket 5y ago
  Isn’t it the actual state of play though? At more and more levels there are only one or two players — e.g., ASML, Samsung/TSMC, AMD/Intel, etc. There are lots of others around but they’ve written off cutting-edge business. That’s even though there are a number of exciting developments in hardware going on. I just think the barrier to entry has grown so large that it’s difficult to avoid.
  - makeitdouble 5y ago
    Right now, regarding CPUs we have: - Intel - AMD - Apple - Qualcomm Any of them is pushing the enveloppe in some way or form, I’d argue they are “cutting-edge”

scotty79 5y ago

Maybe they recognize global nature of this issue since Earth has just one Arm, and if it is damaged all people on Earth will be disadvantaged, including Americans, who, even though some of them don't recognize that, live on Earth not planet America.

garmaine 5y ago

> Doesn't the US government get more tax revenue if Nvidia makes some extra dough charging royalties for that IP? I’m confused. Maximizing tax revenues is not the FTC’s job.

rastapasta42 5y ago

The strategy is for the rich and powerful to sell out this country piece by piece, starting with Hunter Biden's Cobalt mine deal: 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... Great way to cause a chip crises and kill our car industry, but if they keep going at this pace, soon there won't be anything left to sell. https://www.extremetech.com/computing/326447-arm-china-seizes-ip-relaunches-as-an-independent-company https://www.extremetech.com/computing/326447-arm-china-seize...

bboreham 5y ago

> Doesn't the US government get more tax revenue As a frequently observed phenomenon, no. The intellectual property and brand which generate revenue for ARM will be held in some other country, so profits can be directed there and no tax payable in the USA.

stjohnswarts 5y ago

Because it has an extremely HIGH probability of Nvidia being hostile and blocking other companies from getting new or relicensing old licenses. Nvidia is big enough and powerful enough as it is whatever country it is based out of. ARM is much better placed as being independent in the market and not owned by an 800lb gorilla like nvidia.