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Nvidia to Acquire Arm for $40 billion
Nvidia to Acquire Arm for $40 billion
Arm will operate as an Nvidia division and will continue to be based in the UK.
Nvidia said Sunday it would acquire chipmaker Arm from SoftBank for $ 40 billion. Arm will operate as an Nvidia division and will continue to be based in the UK and "will continue to operate its open license model while maintaining its global neutrality with the customer," the company said. But the deal is likely still facing intense regulatory scrutiny.
In 2016, SoftBank bought Arm for $ 31 billion. The British company's intellectual property helps power mobile device processors for companies like Apple, Samsung and Qualcomm. Arm has likely only grown in value since acquiring SoftBank, with Microsoft making an Arm-based Surface and a version of Windows for Arm, and Apple plans to switch future Macs to Arm-based chips.
Nvidia is the leading manufacturer of GPUs, which Arm also designs. Still, aside from its Tegra line of mobile chipsets used in devices like the Nintendo Switch, Nvidia doesn't do much when it comes to CPU design or mobile hardware.
Speaking to Forbes, Nvidia CEO Jensen Huang said his priority after the acquisition would be to "bring Nvidia technology across Arm's extensive network." However, that does not necessarily mean that Arm will change its current licensing model. Bloomberg reports that "Huang said that Nvidia is spending a lot of money on the acquisition and has no incentive to do anything that will make customers leave."
Perhaps to underscore that it intends to keep Arm as a neutral technology provider in the short term, the agreement emphasizes that Arm will continue to be based in Cambridge, UK, and Nvidia says it will invest in building a new research centre of AI there. Nvidia is positioning the acquisition as the setup for the next stage of AI computing. Both Nvidia and Arm see growth opportunities by enabling artificial intelligence software that can run on Arm chips, from small smartphones to massive servers.
Nvidia once had high ambitions to make CPUs for phones, but less successful. This acquisition could change that, but it seems that initially at least, the focus will be on data centres. "What will change is the pace of our roadmap. We know for a fact that the data centres and the clouds are crying out for the Arm microprocessor, the Arm CPU," Huang tells Forbes. "Energy efficiency translates directly into computing capacity, computing performance, and the cost of the provisioning service."
The news underscores the success that Nvidia has had in the past five years, focusing on areas such as GPUs, autonomous vehicles and artificial intelligence.
