The US regulator Federal Trade Commission wants to block the acquisition of ARM by Nvidia and is taking the matter to court. It reasons that Nvidia stands to gain the ability to block its competitors from using important technology through the acquisition.
Nvidia’s aspired acquisition of British chipset supplier ARM is not looking up. First came close examination by competition authorities Europe. now, authorities in the United States follow suit.
The US Federal Trade Commission (FTC) is actively seeking to prevent the acquisition. To this end, the regulator has gone to court. It argues that the proposed acquisition would give Nvidia complete control over chip technology and designs that are also of interest to competitors for the production of their own processors. According to the FTC, this gives Nvidia the ability to block competitors’ access to this technology, take advantage and make it more difficult to compete in the processor market.
Dominant position in three market sectors
More specifically, the acquisition would bring unfair competition to specific processor market sectors, among which are “high-level advanced driver assistance” systems for cars. The latter includes lane assist and collision avoidance technologies. In addition, ARM’s technology is important for network applications such as DPU SmartNICs. These applications strive to improve security and efficiency in data centers.
Furthermore, ARM technology is vital for the chipsets used in data center environments of cloud providers.
The FTC’s proposed lawsuit against Nvidia’s acquisition of ARM will not start until August 9, 2022. In the meantime, the acquisition is ruled out.