UK's CMA: 'Nvidia’s USD 40 Billion Arm deal raise concerns'
The CMA, The Competition and Markets Authority in the UK, has determined that an in-depth investigation into the deal between NVIDIA and Arm is warranted on competition grounds.
Should the deal go ahead, the CMA is concerned that the merged business would have the ability and incentive to harm the competitiveness of NVIDIA’s rivals by restricting access to Arm’s intellectual property (IP). Arm’s IP is used by companies that produce semiconductor chips and related products, in competition with NVIDIA. Ultimately, the CMA is concerned this loss of competition could stifle innovation across a number of markets, including data centres, gaming, the ‘internet of things’, and self-driving cars. This could result in more expensive or lower quality products for businesses and consumers. NVIDIA offered a behavioural remedy – a measure which regulates the ongoing behaviour of a business – but the CMA found that this type of remedy would not alleviate its concerns. Therefore, the CMA found that the merger should be progressed to an in-depth Phase 2 investigation on competition grounds. Andrea Coscelli, chief executive of the CMA, said: “We’re concerned that NVIDIA controlling Arm could create real problems for NVIDIA’s rivals by limiting their access to key technologies, and ultimately stifling innovation across a number of important and growing markets. This could end up with consumers missing out on new products, or prices going up. The chip technology industry is worth billions and is vital to products that businesses and consumers rely on every day. This includes the critical data processing and datacentre technology that supports digital businesses across the economy, and the future development of artificial intelligence technologies that will be important to growth industries like robotics and self-driving cars.”