Arm Co-founder: Nvidia Takeover Would Create Another US Tech Monopoly (theguardian.com) 40
The co-founder of Arm has said that if the government does not stop the $40 billion takeover of the British chip designer, its proposed buyer, Nvidia, will become the next US tech monopoly alongside companies such as Google and Facebook. From a report: Detailing his concerns in a letter to the House of Commons foreign affairs committee, Hermann Hauser said that a deal would end Arm's position as the "Switzerland of the semiconductor industry." Arm, which employs 6,500 staff, including 3,000 in the UK, is a global leader in designing chips for smartphones, computers and tablets. "There is not a single important semiconductor company in the world which does not have an Arm licence," said Hauser. "Nvidia has an opportunity to become the quasi monopoly supplier of microprocessors to the world. This [deal] will give Nvidia a dominant position in all processor segments and create another US technology monopoly which has created so much angst in Britain when the country worries about the surreptitiously controlling influence Google, Facebook, Netflix and Amazon has on the UK economy." Hauser argued that because Nvidia is one of more than 500 Arm licensees worldwide, becoming the Cambridge-based business's parent company will destroy its "even-handed" model and ultimately kill the world-leading British tech firm. "Technology sovereignty is fast becoming the defining issue of the decade," said Hauser. "Given the importance of our IT infrastructure, which is correctly compared with our water and electricity infrastructure, [the takeover] clearly relates to national security as well."
Re: (Score:2)
Re: (Score:2)
Re: (Score:2)
It already kind of is given the way that so many U.S. companies will bend over backwards for China in order to cater to that market. So in a sense the monopoly (I don't believe most of them are, but I'll just go along with the term) is based in the USA, but it's being directed in part by the Chinese government.
Yes, of course. But we do not need a monopoly domestically to achieve that.
Why didn't the license holders band together? (Score:3)
Honestly, I could easily have seen the license holders all kicking in a few bucks each, and done a counter offer against Nvidia, with a board of directors voted in by the license holders at large. They could have structured it so they have majority control, IPO'ed it, and possibly make some money in the long run.
Re: (Score:2)
Re: (Score:2)
Given how much Apple likes to control its entire supply chain, and Apple's recent move to ARM chips, I am surprised Apple alone isn't trying to outbid Nvidia. They have a considerable cash pile to play with.
Re: (Score:2)
Apple has a perpetual license to the Arm instruction set and core designs.
So they have little reason to care what Nvidia does.
Re: (Score:2)
Apple benefits from a large and diverse ARM ecosystem. This lesson they should have learnt when they moved Macs from PowerPC to Intel.
Re: Why didn't the license holders band together? (Score:1)
Yea but that's a long term lesson. And corporate boardrooms don't do long term.
Re: (Score:2)
I didn't know that. That does remove a lot of the impetus. Not all -- might still be nice to be able to restrict sales to some specific other major tech power. But that explains why they weren't chomping at the bit. Thanks for the info.
Re: (Score:2)
Re: (Score:2)
Re: (Score:3)
Nvidia is also a significant player in the RISC-V [riscv.org] world too. I don't think you can get away from their influence so easily.
What's weird about all of this is that people were happy to pay millions to ARM Holdings. But very few companies license any of NV's IP and some of it is given away freely [github.com]. Complaining about a company that doesn't actually do that much business in a field seems overly dramatic.
The whole spectacle is amusing though. "Let's keep ARM British!", says the Austrian, some four years after sell
Re: (Score:2)
Paying ARM to do the development is cheaper than developing your own design. People pay the license costs because it is SAVING money, not costing them more. And not having to deal with the infighting as one company wants something added to RISC-V while another wants to do something else was probably a blessing.
Re: (Score:2)
full throttle on abandoning ARM
Yes that's happening.
Re: (Score:2)
Well, at least you're trying to figure out a solution, but I think the problem with this approach (and the answer to your speculative question) is that it doesn't address the root of the problem. The likely best-case outcome would merely be to bump up the stock price a bit and make the monopolistic acquisition a bit more expensive, but it could flop the other way and actually make the takeover easier and cheaper.
Actually I'm beginning to see two interlocking and underlying problems with these situations. On
What's ARM got to do with IT infrastructure? (Score:2)
"Technology sovereignty is fast becoming the defining issue of the decade," said Hauser. "Given the importance of our IT infrastructure, which is correctly compared with our water and electricity infrastructure, [the takeover] clearly relates to national security as well."
The UK might be different, but I haven't heard of a takeover in IT infrastructure like high-speed routers and security scanners by ARM - as far as I know, Intel still reigns there. ARM's always had the endpoint - it's the infrastructure t
Re: (Score:2)
The UK might be different, but I haven't heard of a takeover in IT infrastructure like high-speed routers and security scanners by ARM - as far as I know, Intel still reigns there.
They do, but it's not hard to imagine those jobs being done by more aggressively multicore ARM designs in the future. And ARM is already picking up some of the more I/O bound jobs in the server space because of its lower power consumption, and their use in that role is likely to expand significantly before RISC-V becomes a major factor. As well, ARM cores absolutely dominate the low-end networking infrastructure market. The very lowest-end hardware is still likely to be MIPS-based, but everything in between
Probably true, but why were they for sale? (Score:5, Insightful)
ARM sold out to Softbank. They already gave up control. Now they want to complain that a different third party not based in the UK will control the company they already gave up control over. If ARM was so important to the UK, perhaps they shouldn't have sold it to Softbank in the first place.
When you choose to sell out, you lose any moral high ground you might have occupied. This is capitalism 101 stuff.
Softbank is also supposed to get 10% of nVidia from this move, so not only are they at least getting their money back out of ARM (possibly even turning a small profit) they are also getting a piece of the new juggernaut being created. If ARM didn't foresee this sort of thing being likely then they really weren't being realistic. More likely, ARM's leadership absolutely did foresee it, and thought it would be good for them personally. And it is: They stand to pick up a large portion of $1.5B earmarked for ARM employees [fool.com].
Re: (Score:2, Insightful)
> When you choose to sell out, you lose any moral high ground you might have occupied. This is capitalism 101 stuff.
"Selling-out" has nothing to do with capitalism or with the issue at hand.
In any case, the issue here is the legislation that regulates foreign takeover of domestic entities. ARM is still a UK based company that just so happens to have its shares owned by a foreign company. There is no carte blanche for the current owners to sell it to anybody it wishes.
Re: (Score:2)
When you choose to sell out, you lose any moral high ground you might have occupied. This is capitalism 101 stuff.
I don't think moral high ground is part of capitalism, 101 or otherwise.
Re: (Score:2)
Re: (Score:2)
Treating them as two mutually exclusive phenomena is your mistake. Some very good examples of trade that's also theft would be a price-fixing or cartel scheme, or a monopoly situation. Then you'd need a more powerful system to artificially intervene in these scenarios to reduce the theft factor.
This will all get very complicated very quickly, so you may want to stick to a set of hypersimplified dogmatic axioms to maintain your belief in a system that is simple, elegant, and wrong.
Re: (Score:2)
Softbank wasn't in the position to turn ARM into a vertically integrated monopoly like NVIDIA is.
Maybe the ARM founders, (Score:3)
TSMC as well (Score:3)
Re: (Score:2)
China is rapidly developing their own CPUs and their own fabs, and ARM becoming an American company will only make them push even harder to get it done.
It's also an issue for Europe, maybe time we mad RISC V happen, although I'd prefer a better architecture to take on that mantle.
Re: (Score:2)
although I'd prefer a better architecture to take on that mantle.
What's wrong the current one?
Re: (Score:1)
It's simpler for Chinese to block the acquisition. And they should, together with the UK. Don't let the company with uber-expensive cards and their shitty linux binary-only driver win this one.
Advanced Tech Attracts Monopolies (Score:3)
This is a problem with our technology market today. When your business produces advanced technology, over time you will just get better off of it, and improve you design to a point, where it is nearly impossible for a Startup to try to compete against you. Unless you really let your business model slide, or the Startup comes up with something that changes the game.
Sure I may be able to design a better Chip, Program A better social media Platform, create a better Search Algorithm. However my product will be extremely difficult to market, because I don't have the Economies of Scale to sell my chip at an affordable price that people would want to get, I don't the have the User Base to attract other users onto my site. I don't have a Database of billions of Websites at my beck and call.
It is no longer who can build a better mousetrap, But who can provide enough good enough mousetraps for a price people will want to pay.
A small company can probably compete against a Giant like Logitech with making a better keyboard, mouse, etc... Because people may be willing to pay 2x more for a better device, even if it isn't twice as good. Because Paying $80 for a keyboard, vs paying $160 of a keyboard, That is a little better, may be worth it for a lot of people.
When people make a purchase decision there is a few breakdowns on how much that purchase would affect them.
I will be using my Middle Class budget as an example, some people may have different pain areas.
If a purchase price will not really hit your budget or you will need to make a minor sacrifice, you may Splurge on the better product. Say buying a $8.00 cup of coffee, that you really enjoy. Vs paying $1.00 for an OK cup, at your gas station. This may mean you will not buy some doughnuts or perhaps over the week, you decide not to eat out where you might have.
If I decide to buy a new Laptop or Phone, Between $600-$3000 I will normally want to save up for it. It wouldn't be an impulse buy, But something I'll do some research on. As this will be a product that I would be using for a while (for me over 4 years, normally 6-10+) Then I may figure getting something on the Nicer End would be a better investment over time, as I can go longer without having an obviously out of date device.
Then I have bigger purchases $3000-15,000 That amount of money can take a long time to save up, so this is usually something I really should be careful on getting and should last me a good portion of my life, or improve resellability. This is normally for home repairs, and often need a short term loan, so I can keep my savings for other emergencies.
Then you have Large Purchases $15k-$100k You are probably going to be getting a loan for. And you need to plan your life around paying off such loan. This is usually for Car Payments. How much you decide to spend, is a value judgement on how much Joy the car will bring, vs how much you will be giving up.
Then you have you Life Purchases over $100k. You probably will need a mortgage, and usually goes towards a home. What you choose can affect your quality of life for a long time.
So paying $500 for a GPU vs Paying $12,000 for a GPU that is only slightly better isn't worth it, as it would cross different barriers for the common person. Such GPU will need to sell at 12,000 in order to afford having small batches created, because they currently don't have the demand to ramp up production to make them at $500. So companies who get into this market, will often need to put a lot of money upfront, and pretend they are a much bigger company, having making their own Chip Plants, and product thousands of products, or selling the products at a Large loss, until they have demand to improve production.
Sounds like... (Score:3)
ARM already has a monopoly by the founders own admission, everyone is stuck licensing from ARM. I fail to see how the situation is any different than if nvidia owns it.
Re: (Score:2)
ARM already has a monopoly by the founders own admission, everyone is stuck licensing from ARM. I fail to see how the situation is any different than if nvidia owns it.
If you knew anything about Nvidia, then you wouldn't be asking that question.
Now, I suppose if you're saying "Who cares?" then I'll have to admit, I agree with you there.
Re: (Score:2)
If you knew anything about Nvidia, then you wouldn't be asking that question.
Ooooh mysterious. Just leaves us plebs scratching our heads though.
NVIDIA-20 (Score:2)
Somehow it feels like he is saying that we should prepare for another pandemic. Best to stockpile hardware before another lockdown hits us. Hope you'll all make it through this "evil" monopoly ... (sarcasm)