When it became public that Nvidia was in talks with ARM about an acquisition, some critics raised eyebrows, including ARM's Co-Founder Hermann Houser who called the deal a 'disaster.' When the deal went through, others expressed their concern about the merger's effect on the industry, and now, a few months later, UK Authorities are investigating the $40-billion purchase over concerns regarding competition, AP News reports.
ARM was purchased by Nvidia from Softbank, who had previously acquired ARM in 2016 for $32-billion, but ARM failed to perform up to investor's expectations under Softbank's ownership.
However, unlike Softbank, Nvidia has many competitors that work with ARM technologies, which is why the deal is subject to such intense scrutiny. Nvidia has made a vow to maintain ARM's neutrality and its open licensing model, but not everyone is willing to take Nvidia's word on it.
ARM being a UK-based technology licensor, it is the UK's Competition and Markets Authority that is currently investigating the deal. However, due to regulatory concerns also from the EU, US, and China, ARM says the deal likely won't be complete until early 2022.
"The chip technology industry is worth billions, and critical to many of the products that we use most in our everyday lives," said Andrea Coscelli, Chief Executive of the Competition and Markets Authority (via BBC). "We will work closely with other competition authorities around the world to carefully consider the impact of the deal and ensure that it doesn't ultimately result in consumers facing more expensive, or lower quality, products."
ARM is a chip architecture designer that licenses the designs out to parties interested in incorporating the designs in their own silicon. Among ARM's licensees are Apple, Samsung, Broadcom, Qualcomm, Huawei HiSilicon, Nvidia itself, and more, with its chip designs in almost every smartphone currently in the consumer's hands. Apple's latest M1 chip also contains ARM technology. The concern is that Nvidia's ownership of ARM would give it too much power over its competitors.