# [VideoCardz] FTC is suing to block NVIDIA’s $40 billion acquisition of ARM



## EastCoast

> The Federal Trade Commission today sued to block U.S. chip supplier Nvidia Corp.’s $40 billion acquisition of U.K. chip design provider Arm Ltd. Semiconductor chips power the computers and technologies that are essential to our modern economy and society. The proposed vertical deal would give one of the largest chip companies control over the computing technology and designs that rival firms rely on to develop their own competing chips. The FTC’s complaint alleges that the combined firm would have the means and incentive to stifle innovative next-generation technologies, including those used to run datacenters and driver-assistance systems in cars.
> 
> “The FTC is suing to block the largest semiconductor chip merger in history to prevent a chip conglomerate from stifling the innovation pipeline for next-generation technologies,” said FTC Bureau of Competition Director Holly Vedova. “Tomorrow’s technologies depend on preserving today’s competitive, cutting-edge chip markets. This proposed deal would distort Arm’s incentives in chip markets and allow the combined firm to unfairly undermine Nvidia’s rivals. The FTC’s lawsuit should send a strong signal that we will act aggressively to protect our critical infrastructure markets from illegal vertical mergers that have far-reaching and damaging effects on future innovations.”
> 
> According to the complaint, the acquisition will harm competition in three worldwide markets in which Nvidia competes using Arm-based products:
> 
> 
> High-Level Advanced Driver Assistance Systems for passenger cars. These systems offer computer-assisted driving functions, such as automated lane changing, lane keeping, highway entrance and exit, and collision prevention;
> DPU SmartNICs, which are advanced networking products used to increase the security and efficiency of datacenter servers; and
> Arm-Based CPUs for Cloud Computing Service Providers. These new and emerging products leverage Arm’s technology to meet the performance, power efficiency, and customizability needs of modern datacenters that provide cloud computing services. “Cloud computing” refers to the increasingly popular computing business model in which large datacenter operators provide computing services remotely and/or directly offer computing resources for rent, as well as provide other support services to customers who can then run applications, host websites, or perform other computing tasks on the remote servers—i.e., “the cloud.”
> The complaint also alleges that the acquisition will harm competition by giving Nvidia access to the competitively sensitive information of Arm’s licensees, some of whom are Nvidia’s rivals, and that it is likely to decrease the incentive for Arm to pursue innovations that are perceived to conflict with Nvidia’s business interests.











Federal Trade Commission is suing to block NVIDIA's $40 billion acquisition of ARM - VideoCardz.com


FTC Sues to Block $40 Billion Semiconductor Chip Merger Vertical deal between chip supplier Nvidia and chip design provider Arm would allow combined firm to stifle competing next-generation technologies The Federal Trade Commission today sued to block U.S. chip supplier Nvidia Corp.’s $40...




videocardz.com





This is not surprising at all. As a matter of fact it was expected.


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## des2k...

this makes 0 sense to me

how can you sue on a speculation / something that as not happened yet ?

FTC will have a hard time in court if their entire argument is "but in the future Nvidia will prevent others from doing a /b with arm"


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## EastCoast

des2k... said:


> this makes 0 sense to me
> 
> how can you sue on a speculation / something that as not happened yet ?
> 
> FTC will have a hard time in court if their entire argument is "but in the future Nvidia will prevent others from doing a /b with arm"


It makes perfect sense it is completely anti competitive. And the US FTC isn't the only one against this. China regulators are also against the merger for similiar reasons. Even the UK’s Competition and Markets Authority launched a phase 2 level investigation into the deal. It's not a hard concept.

The US is one of the last regulators to actually rebuke the merger. In other words, late to the party!

Companies like Samsung, Qualcomm and Apple have openly rebuked the merger as well. And it's been rumored they are using their political clot to stop the merger.


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## Paradigm Shifter

EastCoast said:


> The US is one of the last regulators to actually rebuke the merger. In other words, late to the party!
> 
> Companies like Samsung, Qualcomm and Apple have openly rebuked the merger as well. And it's been rumored they are using their political clout to stop the merger.


Yup; seems like everyone dislikes the idea of nVidia being able to go the Apple route and control an entire ecosystem rigidly.

Back when the purchase was announced I predicted this would happen... although I'm surprised the UK actually objected - successive UK governments (of both flavours) usually don't seem to care too much when critical technology or infrastructure gets sold off, so long as they get a cut. Sorry, that was overly cynical of me.

I also predicted that if it did go through, that less than a decade later the HPC market would be systems that were 100% nVidia - from CPUs, interconnects (nVidia already owns Mellanox), GPUs, and (given a year or so back they were advertising for *BSD developers, I suspect that a *BSD-based (but completely closed)) OS would be on the cards as well. Maybe someone else had the same worry.


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## maltamonk

des2k... said:


> this makes 0 sense to me
> 
> how can you sue on a speculation / something that as not happened yet ?
> 
> FTC will have a hard time in court if their entire argument is "but in the future Nvidia will prevent others from doing a /b with arm"


To be fair, they kinda have a history of doing that sorta thing.


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## Mahigan

nVIDIA, a Corporation with a track record of closed sourced proprietary solutions, is surprised that nobody but them and their fans want this acquisition to occur.


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## EastCoast

I personally never thought the merger would go through and would be full of opposition. Anyone who did a little research on the company's history would know how anti competitive they would be had it gone through.


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## SoloTromboneLord

des2k... said:


> this makes 0 sense to me
> 
> how can you sue on a speculation / something that as not happened yet ?
> 
> FTC will have a hard time in court if their entire argument is "but in the future Nvidia will prevent others from doing a /b with arm"


Yea, antitrust laws exist to stop things like these.
They don’t let a company get to much power over to many markets.
They’ll cite antitrust laws, point out other times companies abused to much power.
They’d also cite the issues that arise with nvidia owning the rights to something it’s competitors in the market rely on


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## EastCoast

IMO, if this had gone through arm would be no more. All existing designs by other companies would be invalid and put into planned obsolesces. And all existing hardware using Arm would need a hw update to state it's called nv "something something".

It would have been a complete disaster for existing hardware using arm as they would loathe the idea of arm still existing as a name for them. Yes, they are that toxic!


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## Piers

My MP in Parliament has raised this matter with the CMA and there's widespread concern amongst the government, so it's unlikely to go through UK regulation which is most important in this instance.


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## Paradigm Shifter

EastCoast said:


> I personally never thought the merger would go through and would be full of opposition. Anyone who did a little research on the company's history would know how anti competitive they would be had it gone through.


Mellanox.



Piers said:


> My MP in Parliament has raised this matter with the CMA and there's widespread concern amongst the government, so it's unlikely to go through UK regulation which is most important in this instance.


That hasn't stopped them before.

I have a lot of bad memories of an MP who talked a good game, but ran away and hid as soon as it involved actually standing up and being seen/heard to dissent against their party - especially if a vote was likely, or the margin of success/failure was razor thin.


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## EastCoast

FYI, it only takes 1 regulatory folks.


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## mindarya

they did it on time


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## EastCoast

mindarya said:


> they did it on time


Better late then never


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## Revv23

hopefully they can stop the deal. 

I have no beef with nvidia but i don't think the importance of arm being independent can be overstated. 

You don't pay 40 Billion for a company without the intent of making the investment pay off in a big way


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## EastCoast

Revv23 said:


> hopefully they can stop the deal.
> 
> I have no beef with nvidia but i don't think the importance of arm being independent can be overstated.
> 
> You don't pay 40 Billion for a company without the intent of making the investment pay off in a big way


I believe the deal is stopped.
It would be comical at the number of phones/tablets/etc that would start up with nv logo after an typical update. Also, while the phone/tablet is being unlocked. 
😂🤣


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## Revv23

EastCoast said:


> I believe the deal is stopped.
> It would be comical at the number of phones/tablets/etc that would start up with nv logo after an typical update. Also, while the phone/tablet is being unlocked.
> 😂🤣


It's not stopped at all unless I misunderstand something. Trial is in may, a deal this big you know there is lobbyists and such involved. It's interesting that Google and M$ are the two loudest objectors of how anti competitive this deal would be LOL.


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## EastCoast

Revv23 said:


> It's not stopped at all unless I misunderstand something. Trial is in may, a deal this big you know there is lobbyists and such involved. It's interesting that Google and M$ are the two loudest objectors of how anti competitive this deal would be LOL.


It is stopped. That's who they are looking for approval from


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## Revv23

EastCoast said:


> It is stopped. That's who they are looking for approval from


From the FTC site:

"The complaint names Nvidia Corp., Arm Ltd., and Arm owner Softbank Group Corp. The Commission vote to issue the administrative complaint was 4-0. The administrative trial is scheduled to begin on August 9, 2022."









FTC Sues to Block $40 Billion Semiconductor Chip Merger


The Federal Trade Commission today sued to block U.S. chip supplier Nvidia Corp.’s $40 billion acquisition of U.K. chip design provider Arm Ltd.




www.ftc.gov





It's not over it hasn't even started yet.


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## EastCoast

Revv23 said:


> From the FTC site:
> 
> "The complaint names Nvidia Corp., Arm Ltd., and Arm owner Softbank Group Corp. The Commission vote to issue the administrative complaint was 4-0. The administrative trial is scheduled to begin on August 9, 2022."
> 
> 
> 
> 
> 
> 
> 
> 
> 
> FTC Sues to Block $40 Billion Semiconductor Chip Merger
> 
> 
> The Federal Trade Commission today sued to block U.S. chip supplier Nvidia Corp.’s $40 billion acquisition of U.K. chip design provider Arm Ltd.
> 
> 
> 
> 
> www.ftc.gov
> 
> 
> 
> 
> 
> It's not over it hasn't even started yet.


🤣
It's over.


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## Revv23

EastCoast said:


> 🤣
> It's over.


Why do you say that? Because you believe the ftc will win the lawsuit?

Filing a lawsuit and winning a lawsuit are 2 different things.


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## BenjaminWayn

I think that the chances of winning are not very convincing


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## Revv23

BenjaminWayn said:


> I think that the chances of winning are not very convincing


That I would certainly agree with. Nvidia spokesperson says they are still going for it. Although it's such a huge deal they had to know they were in for a fight.


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## EastCoast

Nvidia is making preparations to give up on Arm acquisition, says report


Too big a deal for regulators to buy




www.theverge.com













NVIDIA Arm Deal Said to be Over According to Bloomberg


It appears that NVIDIA is getting ready to give up on its acquisition attempt of Arm, at least if news coming via Bloomberg is correct. Due to a paywall we can't access the original story, but the reason for the possible end to the deal seems to be issues related to getting government approval...




www.techpowerup.com













Nvidia Might Withdraw $40 Billion Arm Bid


Bloomberg and EEtimes are suggesting that NVIDIA seems to be silently abandoning the ARM deal. According to people familiar with the subject, after making little to no headway in securing approval for...




www.guru3d.com





It is a real shame that in order for someone to process information is to get an immediate, instant result. Unfortunate for them that is not how the world works. Some things take a little time. However through critical thinking one should know the outcome. Not dismiss it because an immediate response wasn't noticed.


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## EastCoast

> Nvidia Corp. is quietly preparing to abandon its purchase of Arm Ltd. from SoftBank Group Corp. after making little to no progress in winning approval for the $40 billion chip deal, according to people familiar with the matter.
> — Bloomberg




__ https://twitter.com/i/web/status/1485918157760086021
There you go....


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## Mahigan

EastCoast said:


> __ https://twitter.com/i/web/status/1485918157760086021
> There you go....


People who are fans of the Corporation, in this case nVIDIA (or any Corporation for that matter), will all too often ignore reason, evidence, and what is demonstrably true if said reason, evidence, and evident reality is negative towards the Corporation they hold in high regard.


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## EastCoast

Mahigan said:


> People who are fans of the Corporation, in this case nVIDIA (or any Corporation for that matter), will all too often ignore reason, evidence, and what is demonstrably true if said reason, evidence, and evident reality is negative towards the Corporation they hold in high regard.


I see it as cognitive dissonance. You are to correct them, yet pitty them at the same time. But always correct them. Dont arguing with them. Because at the end of the day they will try to get some satisfaction of doing just that.

But yeah, nvidia is giving up on the deal. But they have to pay $1.XX Billion to Softbank (which I am sure they are about to do or already sent) as a penalty for the deal collapsing.


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