Last year, in September, Nvidia had announced that it is planning to acquire ARM Holdings in a deal worth 40 billion US Dollars but other tech giants like Google, Qualcomm, and Microsoft are against the deal and have protested against it. Currently, the deal is facing major regulatory hurdles.
The said deal was between Nvidia and SoftBank Group, the current owner of ARM Holdings. ARM Holdings is behind the popular instructions and core designs. The company licenses those designs to other companies rather than makings its own SoCs. As per a report, currently, over 90 per cent of all smartphones in the world utilize ARM cores.
It is worth mention that even Apple has moved towards the ARM-based M1 chipset for its laptops. Apple laptops use its instruction set but not the ARM cores. In simple words, the ARM design is widely used across brands. The opposing companies are protesting because they are concerned that if Nvidia gains control over ARM, it might use it to leverage the licensing deals that the latter holds across the globe. Digit reported that Nvidia and ARM are not direct competitors but its supply to its rivals might be against its interest post-acquisition.
Firms like Google have alleged that this conflict of interest might lead Nvidia to use its position to impact the business models of other companies. As of now, apart from the opposition of these tech giants, the China division of ARM Holding is also facing a major hurdle for the acquisition.
Allen Wu, Chief Executive of ARM China, who holds about 17 per cent stake in the four investment firms of ARM China is in a standoff with ARM China’s board which wanted to remove him as the head. It seems the acquisition would have to wait till this resolves.