Nvidia is quietly preparing to drop the company's long-standing acquisition of Arm,

[kladzen]

Summary

Nvidia is quietly preparing to drop the company's long-standing acquisition of Arm, which has met with strong opposition.

 

Quotes

Quote

Nvidia has quietly begun contacting partners and business associates to let them know that the company is dropping its lengthy acquisition of Arm.
Nvidia and Arm owner SoftBank agreed that Nvida would take over Arm for $ 40 billion just over a year and a half ago.

 

But since then, the agreement has met with great opposition from many different sides, and Nvidia has had great difficulty in landing the necessary permits from not least competition authorities around the world.

 

Nvidia now announces, according to Bloomberg, that the company no longer expects the acquisition to turn into anything. Japanese SoftBank - which owns Arm - will now reportedly go after listing Arm instead.

 

However, according to Bloomberg's sources, no final and official decision has yet been made to drop the deal.

 

The acquisition has caused concern in the EU, in China and in the United States. This is because Arm is behind a special chip architecture that other manufacturers can use and modify to their own needs via licenses.

 

My thoughts

Well - it's not a major surprise to me with the concerns of ARM being under nvidia wings... so that to me makes sense... I would assume this also have some kind of impact in the long run with ARM not being under nvidia, we all know the saying "it will keep the way it is.... nothing going to change" well that might be true for the first couple of years... but IF the deal would be excuted what would that look like in the long 10-15 year run for consumers? not good i think, i personally think this is for the better for the consumer.

 

Sources

FULL SOURCE . https://www.computerworld.dk/art/259480/nvidia-goer-i-al-stilhed-klar-til-at-droppe-kaempe-opkoeb-af-arm-efter-stor-modstand

DANISH LANGUAGE

[Orcblood]

Good.

[Rauten]

[Insert sigh of relief]

[porina]

nvidia had to be realistic that given the comments from various regulators, the chances of completing the deal were looking slim. However I don't share the concerns under traditional anti-competitive laws, and feel this is more political than just business. It is what it is, and the world will move on.

[Mark Kaine]

why does softbank even want to sell, dont they know this is a goldmine and risc arm is the future?

 

 

[Fasterthannothing]

Well that sucks I was hoping for some really cool Nvidia GPUs in a ARM chip

[Master Disaster]

27 minutes ago, Mark Kaine said:

why does softbank even want to sell, dont they know this is a goldmine and risc arm is the future?

 

 

If I'm remembering correctly (and I might not be) they are being forced to sell after a high ranking Chinese employee got fired then went rogue, refused to quit and tried stealing the entire company.

 

I'm 99% sure that's what happened.

[Mark Kaine]

14 minutes ago, Master Disaster said:

If I'm remembering correctly (and I might not be) they are being forced to sell after a high ranking Chinese employee got fired then went rogue, refused to quit and tried stealing the entire company.

 

I'm 99% sure that's what happened.

oh im remembering that story, i forgot that was arm… yeah whatever really happened, something did happen, and they probably just want to get rid of it and all the trouble now… lol.

[StDragon]

Awesome news! That means there's potential Nvidia could develop with RISC-V; one would hope.

[BuckGup]

1 hour ago, SlidewaysZ said:

Well that sucks I was hoping for some really cool Nvidia GPUs in a ARM chip

That's not what would have happened at all. Nvidia bought Mellanox and made it incredibly anticonsumer as they had a monopoly on the high speed networking market. It's one of the sole reasons HPE bought Cray as they had Slingshot but Slingshot is shit and Nvidia is in the lead by over a year

[hishnash]

1 hour ago, SlidewaysZ said:

Well that sucks I was hoping for some really cool Nvidia GPUs in a ARM chip

Nvidia does not need to own arm to do this. they already have an ISA and an arc license to arm. When it comes to producing chips with a mix of ARM and NV IP Nvidia can do that today they do not need to own arm to do it.

Also Nvidias GPU IP is not focused on perf/W so would likly not be a good match. 

[JLO64]

Have there been any updates on the ARM China division going AWOL? I understand that the Chinese Government has basically no incentive to do anything in this situation, but that fact that it may have seriously affected a $40 Billion (failed) acquisition can't be ignored. Also, given that they've hired private security to defend "their" company, I kinda think that this is going to end in a Rainbow Six style raid.

[dalekphalm]

Can't say I'm particularly disappointed by this news. There was always going to be massive anti-trust issues with NVIDIA becoming the owner of a company that their direct competitors regularly do business with.

 

Personally I'd be happy with taking ARM public, or have them be acquired by a company without direct ties to ARM's competition.

[Orcblood]

Nvidia should just focus on Risc-V if they want to enter the CPU arena.

[Brooksie359]

1 minute ago, Orcblood said:

Nvidia should just focus on Risc-V if they want to enter the CPU arena.

You realize that nvidia could easily license the arm ip and create arm based cpus like Qualcomm and Apple do. Them not acquiring ARM wouldn't prevent them from doing so. I also think that would make more sense than going RISC-V. 

[dalekphalm]

2 minutes ago, Brooksie359 said:

You realize that nvidia could easily license the arm ip and create arm based cpus like Qualcomm and Apple do. Them not acquiring ARM wouldn't prevent them from doing so. I also think that would make more sense than going RISC-V. 

NVIDIA already does license ARM - they've in fact made multiple ARM CPU's before.

[hishnash]

2 hours ago, dalekphalm said:

Personally I'd be happy with taking ARM public, or have them be acquired by a company without direct ties to ARM's competition.

if they did go public it would be important to put some constraints in place so that a big vendor could not just use thier case to execute a hostile takeover. Something like no single shareholder/group can own more than 20%. 

If ARM did go public I would put quite a large investment in!

[dalekphalm]

Just now, hishnash said:

if they did go public it would be important to put some constraints in place so that a big vendor could not just use thier case to execute a hostile takeover. Something like no single shareholder/group can own more than 20%. 

If ARM did go public I would put quite a large investment in!

For sure, some considerations definitely need to be made to protect the company from competitors.

[hishnash]

2 hours ago, dalekphalm said:

For sure, some considerations definitely need to be made to protect the company from competitors.

Eg intel buying them out so that they can then stop ARM from licensing any new designs? ... that would be the worst case.  

To be honest I think the best case would be for a consortium of tec companies to found a `Arm Foundation` that ownes and runs arm but is run in the same way other joint ventures are (with a load of rules to stop one of the owners using it to hurt the others).

This would also help ensure the ARM ISA does not end up fragmented since ISA license holders are free to change it if they want, without the buy-in from these vendors to push for these changes to be upstream they are likly to end up going to a different path fragmenting the instruction set's feature set. (thinking of Apple here but others also adapt the ISA to meet there needs, to date these vendors do tend to push these additions back into the mainstream ISA for the next revision). 
 
 

[mr moose]

8 hours ago, porina said:

nvidia had to be realistic that given the comments from various regulators, the chances of completing the deal were looking slim. However I don't share the concerns under traditional anti-competitive laws, and feel this is more political than just business. It is what it is, and the world will move on.

 

I mostly agree,  I would understand the outcry if it was a Taiwanese or Korean company,  but Nvidia is US based.  So like other US based companies they'd normally enjoy a bias in the US legal system.

[hishnash]

3 minutes ago, mr moose said:

So like other US based companies they'd normally enjoy a bias in the US legal system.

but it is not just US regulators that are looking into this and if Nvidia wants to be bale to sell products into the rest of the world it needs to ensure all the regulators around the world are happy with it.  Not worth buying ARM and then finding out that Nvidia is listed and non-compliant in EU and then unable to sell any products or sign any contracts in the EU and all EU companies are banned from working with them since they are considered in violation (this is what would happen if they ignored a regulators warning and said 'we are based in the US so go F yourself.")

[mr moose]

22 minutes ago, hishnash said:

but it is not just US regulators that are looking into this and if Nvidia wants to be bale to sell products into the rest of the world it needs to ensure all the regulators around the world are happy with it.  Not worth buying ARM and then finding out that Nvidia is listed and non-compliant in EU and then unable to sell any products or sign any contracts in the EU and all EU companies are banned from working with them since they are considered in violation (this is what would happen if they ignored a regulators warning and said 'we are based in the US so go F yourself.")

It's the US regulators taking legal action. 

 

The rest is just speculation from people who nothing about international trade embargo's.    I mean do you really think the EU is going to prevent phone makers from selling devices using ARM IP just because Nvidia own them and they can't regulate the sale? 

 

EDIT: I'm no IP/trade lawyer, but the EU really only has three options in the event Nvidia did acquire ARM:

 

1. do nothing and let all contracts go through as per free market regulation (unlikely because the EU don't do that).

2. Compromise to agreement on regulation that prevents NVIDIA from abusing their market monopoly. (most likely outcome as this happens all the time with apple, google and MS).

3. Ban the sale of Nvidia IP which basically means all phones and tablets in the EU until NVIDIA sell ARM.  (not going to happen because NVIDIA are the only ones interested in buying ARM).

[hishnash]

12 minutes ago, mr moose said:

The rest is just speculation from people who nothing about international trade embargo's.    I mean do you really think the EU is going to prevent phone makers from selling devices using ARM IP just because Nvidia own them and they can't regulate the sale? 

 

The EU would prevent a phone maker from selling a device using ARM IP licensed after the illegal merger yes. 

 

 

13 minutes ago, mr moose said:

2. Compromise to agreement on regulation that prevents NVIDIA from abusing their market monopoly. (most likely outcome as this happens all the time with apple, google and MS).

3. Ban the sale of Nvidia IP which basically means all phones and tablets in the EU until NVIDIA sell ARM.  (not going to happen because NVIDIA are the only ones interested in buying ARM).

Sure (2) is what would be most likely but that requires Nvidia to not ignore the EU. Said above if Nvidia just ignored the EU regulator they could not come to a `Compromise agreement`

(3) the EU would only need to band Nvidia IP that is post merger, due to how ARM licenses work this means all the big arm vendors would still be able to sell products in the EU without issue since they all purchased thier licenses years and years ago. The main effect would be Nvidia ability to sell GPUs and other networking and server equipment directly to the EU (suff licensed post merger or stuff sold by Nvidia post merger).  The EU would not ban you from selling a Nvidia gpu into the EU as long as you purchased it before the illegal merger.  (the likes of Qualcomm, Apple, Samsung could continent to sell devices into the EU for years unless they build new devices using new Nvidia IP). 

And if a company ignores the courts in a region then this is the default action that always takes place, If you just ignore a legal case then the result is a trade ban on all future products and IP.  This is the only way that courts outside can get international companies to even listen to them and engage in that compromise. 

[mr moose]

2 minutes ago, hishnash said:

The EU would prevent a phone maker from selling a device using ARM IP licensed after the illegal merger yes. 

 

Never going to happen.

 

2 minutes ago, hishnash said:

 

Sure (2) is what would be most likely but that requires Nvidia to not ignore the EU. Said above if Nvidia just ignored the EU regulator they could not come to a `Compromise agreement`

Which happens all the time, ergo the merger is not that big of a deal.

 

2 minutes ago, hishnash said:

(3) the EU would only need to band Nvidia IP that is post merger, due to how ARM licenses work this means all the big arm vendors would still be able to sell products in the EU without issue since they all purchased thier licenses years and years ago. The main effect would be Nvidia ability to sell GPUs and other networking and server equipment directly to the EU (suff licensed post merger or stuff sold by Nvidia post merger).  The EU would not ban you from selling a Nvidia gpu into the EU as long as you purchased it before the illegal merger.  (the likes of Qualcomm, Apple, Samsung could continent to sell devices into the EU for years unless they build new devices using new Nvidia IP). 

And if a company ignores the courts in a region then this is the default action that always takes place, If you just ignore a legal case then the result is a trade ban on all future products and IP.  This is the only way that courts outside can get international companies to even listen to them and engage in that compromise. 

Again, not going to happen.  You really think any government body is going to stop all new phones and tablet sales?  Let's not even talk about the super computers all running arm IP and the fact that NVIDIA already owns a huge portion of the interconnect IP that those computers need.

 

The only country that has actually done something to prevent the merger is the US and the only country that stands to gain something from the merger is the US.  As I said before, most of our speculation is lacking. 

[hishnash]

11 minutes ago, mr moose said:

You really think any government body is going to stop all new phones and tablet sales?  Let's not even talk about the super computers all running arm IP and the fact that NVIDIA already owns a huge portion of the interconnect IP that those computers need.

EU would absolutely stop future IP licenses and Nvidia licensed products, of course any product that will be manufactured in the next 5 years will be based on existing contracts/IP and thus not subject to these rules.  All of that existing IP is pre merger so not subject to such a restriction.  

A regulation body that is there to controle monopoly will not avoid punishing a monopoly player due to that monopoly player having to much of a monopoly.  Remember (unlike most other regions) the EU regulators are much more removed from the political aspect, voters being upset that they can't get new gaming GPUs or companies being upset they can't get new Nvidia server hardware is not something that really effects the EU commission (well it does but only with 5 to 10 years worth of lag) the commission operates very detached from the political whims of member states. Unlike US regulators.

 

13 minutes ago, mr moose said:

Never going to happen.

I agree Nvidia would have not risked ignoring the EU regulators due to the consequence of doing so.