Microsoft, Google, and Qualcomm have been raising concerns to regulators about Nvidia’s Arm acquisition, according to reports by CNBC and Bloomberg. The companies have approached regulators in the US, EU, UK, and China, reportedly with concerns that Nvidia could change how Arm licenses out its chipmaking technology.
Nvidia has pledged that it won’t use its control over the company to change how it interacts with other businesses. Writing to the Financial Times, Nvidia CEO Jensen Huang said he could “unequivocally state that Nvidia will maintain Arm’s open licensing model. We have no intention to ‘throttle’ or ‘deny’ Arm’s supply to any customer.”
Nvidia’s rivals argue, however, that keeping Arm neutral and not using its tech to Nvidia’s own gains isn’t what the company would be incentivized to do — especially not after paying $40 billion for it. Restrictions on licensing, however, would hurt the 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.
For its part, Nvidia has argued that the acquisition is about driving AI forward, which is an area Nvidia has focused on heavily, from its machine learning-powered upscaling on its graphics cards to its work in self-driving cars. Arm’s low-power technology could help Nvidia spread AI into more places, but the company will also have to figure out what to do with everything else Arm does — mainly, powering almost every cellphone in existence as well as holding the key to computer companies moving away from Intel.
Regulators are also apparently looking closely at the deal to determine whether it would give Nvidia too much power in the chipmaking business: according to CNBC the Federal Trade Commission has asked Nvidia and Arm to give it more information, and it could be talking to “other companies who may have relevant information.”
Meanwhile, UK and EU officials have promised to “thoroughly investigate” the deal. It’s very likely that they will hear many objections, not just from Google, Microsoft, and Qualcomm, but from others in the chipmaking industry who are concerned about their 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 in the 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 ‘90s, where it went up against the US government, and Google has recently been the focus of growing antitrust sentiment in the US and EU.