Microsoft, Google and Qualcomm have raised concerns for regulators about the acquisition of Nvidia Arm, according to CNBC reports and Bloomberg. The companies approached regulators in the U.S., EU, UK and China, allegedly with concerns that Nvidia could change the way Arm licenses its chip-making technology.
Nvidia has promised that it will not use its control over the company to change the way it interacts with other companies. Writing for Financial TimesNvidia’s CEO, Jensen Huang, said he could “state unequivocally that Nvidia will maintain Arm’s open licensing model. We have no intention of ‘strangling’ or ‘denying’ Arm’s supply to any customer. “
Nvidia’s rivals argue, however, that keeping Arm neutral and not using its technology for Nvidia’s own earnings is not what the company would be encouraged to do – especially not after paying $ 40 billion for it. Licensing restrictions, however, would hurt companies that benefit from having the ability to license Arm’s technology. Google and Microsoft are reportedly working on their own Arm-based chips, and Qualcomm’s processors are based on the architecture.
In turn, Nvidia argued that the acquisition aims to boost AI, which is an area that Nvidia has focused heavily on, from enhancing machine learning on its graphics cards to working on autonomous cars. Arm’s low-power technology could help Nvidia spread AI to more places, but the company will also have to figure out what to do with everything Arm does – primarily, power almost all existing phones, as well as the key. for moving computer companies away from Intel.
Regulators are also apparently looking closely at the deal to determine whether it would give Nvidia a lot of power in the chipmaking business: according to CNBC the Federal Trade Commission asked Nvidia and Arm to provide more information and could be talking to “other companies that may have relevant information”
Meanwhile, UK and EU officials have pledged to “thoroughly investigate” the deal. It is very likely that they will hear many objections, not just from Google, Microsoft and Qualcomm, but from others in the chip industry who are concerned about the open licensing agreement with Arm being affected by the merger.
These companies have experience with regulators and anti-competitive behavior. Qualcomm has had to pay several fines of hundreds of millions and sometimes billions of dollars to authorities in China, South Korea and the EU for anti-competitive licensing policies. Microsoft, of course, had its big monopoly case in the 1990s when it rebelled against the United States government, and Google has recently been the focus of the growing antitrust sentiment in the United States and the EU.