UK Considers Blocking Nvidia Takeover of ARM Over Security (yahoo.com) 75
According to Bloomberg, the U.K. is considering blocking a takeover of Arm by Nvidia due to potential risks to national security. SoftBank announced plans to sell Arm to U.S. chip company Nvidia last September for more than $40 billion. It's been under investigation and protested ever since. Bloomberg reports: In April, U.K. Culture Secretary Oliver Dowden asked the Competition and Markets Authority (CMA) to prepare a report on whether the deal could be deemed anti-competitive, along with a summary of any national security concerns raised by third parties. The assessment, delivered in late July, contains worrying implications for national security and the U.K. is currently inclined to reject the takeover, a person familiar with government discussions said. The U.K. is likely to conduct a deeper review into the merger due to national security issues, a separate person said.
No final decision has been taken, and the U.K. could still approve the deal alongside certain conditions, the people added. Dowden is set to decide on whether the merger needs further examination by the U.K.'s competition authorities. "We continue to work through the regulatory process with the U.K. government," said an Nvidia spokesperson in a statement. "We look forward to their questions and expect to resolve any issues they may have."
No final decision has been taken, and the U.K. could still approve the deal alongside certain conditions, the people added. Dowden is set to decide on whether the merger needs further examination by the U.K.'s competition authorities. "We continue to work through the regulatory process with the U.K. government," said an Nvidia spokesperson in a statement. "We look forward to their questions and expect to resolve any issues they may have."
Do it. (Score:3, Insightful)
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Explaining why no one owns their products. ;-)
Re:Do it. (Score:4, Insightful)
People kept using Windows and Microsoft has always been pretty much a shit company. Being backed into a corner doesn't mean nvidia isn't a shit company. Until recently AMD couldn't compete. Now, they can.
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"doesn't work or is otherwise incapable of performing needed functions"
As a security professional, I've built an entire (quite lucrative) career on this concept as it relates to microsoft products.
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Re:Didn't UK divorce the EU to get closer to the U (Score:5, Insightful)
My understanding is that the SoftBank deal was considered acceptable because they agreed to take a hands-off approach to operations. I don’t see how Brexit or the U.S./Japanese angles are relevant. Nvidia has incentives to fundamentally change how ARM operates in ways that could harm competition and cause the British to lose an important domestic tech company. SoftBank doesn’t.
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Nvidia bought Bristol-based fabless semiconductor start-up Icera [wikipedia.org] in 2011, and then shut it down 4 years later. Primarily because Nvidia decided they didn't want to make cell phone chips with integrated modems [wikipedia.org] anymore.
I doubt UK regulators are nuanced enough to have followed this old story in their own backyard. But there are already pretty good reasons to distrust American corporations in general.
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Re: Didn't UK divorce the EU to get closer to the (Score:2)
Iâ(TM)d also add with countries wanting to ensure chip fabrication and expertise is available within their territory, the Nvidia buyout could work against this.
It may be better to have a ARM owned by a holding company, with no company or individual able to have more than 50% ownership, in which the British government has a stake?
That was a previous government (Score:5, Insightful)
ARM should have never have been allowed to be sold to Softbank or anyone else, but whats done is done. However compared to what NVidia will do - essentially gut ARM for its IP and close the UK offices in a few years - Softbank have been fairly benevolent.
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Precedents... (Score:5, Interesting)
The UK is starting to look very carefully at who owns what. A company called Sheffield Forgemasters has been bought out by the Government as it was about to go bust. It also just happens to be the only company in the UK capable of making certain large metal components for military and power station nuclear reactors.
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I should have pointed out that it only cost the Government a couple of million dollars which is absolutely nothing compared to the Sovereign capability it represents.
EU Angle (Score:3)
From what I’ve read, one of the things that EU member nations are not allowed to do is negotiate their own trade deals, for example. (This, apparently, helps to explain why the UK did such a crap job of negotiating their post-Brexit deal with the EU - because they had terminate
Re:EU Angle (Score:5, Interesting)
"helps to explain why the UK did such a crap job of negotiating their post-Brexit deal with the EU - because they had terminated all their trade negotiators and gutted those government departments, because the EU prohibited them from striking their own agreements). "
I doubt this. My take is that Brexit was and is a stupid idea and there was no getting a "better" deal for Britain. Any deal to leave the EU would leave Britain's panties exposed. Now they will have to duplicate all the regulatory mechanisms the EU used to provide. It has also made Scottish independence more likely since Scotland wanted to remain in the EU. Britain now has a border problem with N. Ireland that they didn't have before making reunification with Ireland increasingly possible.
In addition, any trade deals Britain tries to set up will have them dealing with a weak hand since they won't be EU trade deals. Britain is simply too small to compete effectively with big countries and big economic blocs.
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See here [civilserviceworld.com], or here. [ft.com]
The issue was "by design" because when the UK was a member of the EU, the UK was prohibited from arranging direct trade deals with non-EU nations by EU treaty - literally prohibited from doing bespoke deals. Come the UK's exit, the EU chose to enforce this particular agreement "up to the line" - in other words even though the UK gave the EU notice of exit and all the other plans were put in place, the EU enfor
Re:EU Angle (Score:4, Insightful)
This is all based on the word of renowned liar Oliver Letwin. I'd say you should take it with a pinch of salt, but for a slug like him I'd recommend a mountain of it.
The UK was not prohibited from doing bespoke trade deals. In fact many were negotiated and existed happily during the UK's EU membership.
To your observations:
1) You understand it wrong. The conservative party feared having its anti-EU support eaten by UKIP. So they called a referendum to placate this group. That backfired tremendously. This is the reason we have Brexit. Nothing to do with UK-EU negotiations or refusal to address concerns, that's a misdirection. It was a political miscalculation.
2) This is somewhat true, though if you consider their aim to be the enrichment of their donors and friends, they've been wildly successful. It's only if you are under the misapprehension that they are trying to act in the interest of the country that they appear incompetent. Viewed as a cabal attempting to extract wealth, they are incredibly efficient.
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The UK is the 5th largest national economy in the world out of nearly 200, they are not "too small" by any stretch.
They also have close ties to a large number of other countries especially their former colonies and the commonwealth nations, as well as the advantage of natively speaking the language of international business and the internet.
Trade deals as a bloc can also be more difficult. The EU is a large and diverse bloc with many competing interests, whereas the UK is a small and largely homogenous coun
Re: EU Angle (Score:2)
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Re: EU Angle (Score:2)
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Since the 80s Britain has been selling stuff off cheap. All the nationalised industries like the Post Office and railways were first, but then they started selling private businesses to foreign companies. The owners and shareholders walk away with a big bonus, the company itself goes into decline in most cases.
Being outside the EU doesn't make any difference in legal terms, at least not yet as all the rules as still in place in British law. In the longer term the UK might try to diverge with say massive sta
Re: EU Angle (Score:2)
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Makes sense (Score:2)
Re:Makes sense (Score:5, Insightful)
Trump on the other hand did (Xiaomi), which has spooked the world that if the US president can suddenly (and possibly on a whim) block other nations from access to US technology, then how trust worthy can they be in the future? ARM isn't something that many nations feel should be risked to be used as a bargaining chip by either the current or future president.
So yes, selling it to a US-owned company is a huge national security risk.
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To China, yes, it's a question of national security. Which is why they're diversifying with RISC-V, LoongArch and Zhaoxin to be fabbed internally at mainland Chinese SMIC should Taiwan's TSMC ever get sanctioned.
To Britain though?
Allies being allies, the UK shares all its spook-related security with Canada, New Zealand, USA and Australia. Like it or lump it, *we* are joined at the hip.
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Britain has been on the receiving end of US sanctions and limitations several times since WW2, so the British government does like to keep its options open...
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Sure but one of the key planks of Brexit, allegedly, was to regain its sovereignty and negotiate agreements under its own terms.
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Yes, it will keep its options open. I suspect you mean that now if the U.S. gets pissy with British companies, they have diddley-squat to back them up. Before, they had the EU behind them. Now they are free to get nailed in the teeth should another president like the former alleged president decide to pick up the mantel of stupidity and continue his wreaking havoc on U.S. foreign relations.
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Some people would look at how the US immediately started hammering out a mutually beneficial trade deal with the UK and point to it as proof that you're not only wrong, but s
Re: Makes sense not (Score:2)
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If you can't tell the difference between a global security threat (China)
Re:Makes sense (Score:4, Informative)
I think it's a bit of a stretch to mask the true motivation (nVidia is a strong tech brand that will overshadow the most relevant UK tech brand, whereas SoftBank would leave the brand identity intact).
However, to try to justify a 'security' argument, another difference is that SoftBank would leave the business model intact and allow all sorts of companies to license the tech, meaning suppliers relevant to UK security can source from ARM without being ARM. On the flipside, for example, nVidia acquired Cumulus, a network switch OS expressly designed to work on multiple vendor switches, and the first major release after nVidia sealed the deal? Only supports nVidia switches, despite those switches (Mellanox) being a minority of Cumulus revenue. They immediately shut down all third-party switch support at their earliest chance. So if nVidia gets ARM, there may not be a third-party license opportunity for ARMv10.
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The idea of it being a security issue is just so frikkin absurd. The US and UK are the two closest allies on the planet and have been for almost two centuries.
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I was involved in a different national security review, and evidently one consideration is could critical government agencies and their immediate suppliers deal with the acquired company in question being unavailable to them (i.e. is the company in question a sole supplier in any particular context).
Security isn't just about 'could this supplied surveil us' but 'could this supplier cripple us through withholding product' too. The likelihood of whether that could come to pass is part of the equation (e.g. S
Re: Makes sense (Score:2)
The difference is SoftBank so opportunity to grow and make money off ARM. ARM wouldnâ(TM)t be diluted in their relationship.
On the other hand Nvidia risks diluting ARM or shutting down any U.K. based presence, since it could conflict with what is happening else where in the company. Additionally there is a potential conflict of interest where the competition are also customers, so depending on current leadership could result in cutting off access to ARM designs.
Probably a good idea (Score:1)
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ARM has 8.5k employees, and NVIDIA has 13.7k. I think they're both large corporations. Which one should I assume you are trying to defend?
Kind of odd timing (Score:3)
Seeing as ARM Holdings was bought by Softbank, a Japanese investment company, 5 years ago. Are they going to make Softbank sell ARM to somebody in the UK if they block Nvidia from buying it?
China. (Score:5, Interesting)
My supposition is this is Chinese ARM twisting ... [cnbc.com] ARM under NVDIA (American) has technology export bans...
Other related ongoing aspects have even been mentioned on /. before. [slashdot.org]
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If ARM ever became subject to US export restrictions it would be the end of them. They already moved some R&D out of their US facility to make sure it couldn't be touched.
Even just the possibility of this happening damages ARM, as it pushes China to develop and promote alternatives even faster.
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And let China develop their own shit for a change. The more
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The UK's economic interests are somewhat aligned with China's because China has been a major investor in the UK. For example the new nuclear money pit Hinkey Point C is partly funded by the Chinese, and believe me they tried every other source of cash first but nobody wanted to touch it.
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That would also mean there are some very corrupt UK officials willing to pretend that a threat to China is actually a threat to the UK.
The security argument simply doesn't work when the company already has a foreign owner, and one outside the Anglophone family. And if you're right, it's an insane argument as China's security and economy interests run counter to those of the UK. Hurting China's security and economy is good for the UK and her former citizens in Hong Kong.
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Because that sale came with all sorts of legal caveats as to what Softbank could do with it. Effectively Softbank would forfeit ownership if they sold it to NVIDIA without UK government approval.
Yes! It's best that Japan owns them (Score:2)
How is it their call? (Score:2)
I'm not a business guru but how is it that the UK can stop them if belongs to a company in Japan? I mean, if there are physical assets in the U.K. then I could understand the U.K. blocking the acquisition of those assets but if Nvidia wants it bad enough, couldn't they still buy it without those assets?
BTW, the UK really shot itself in the foot with Brexit.
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Most of the assets are in the UK. Without those, the company is pretty much useless.
Re: How is it their call? (Score:1)
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If you dumped ARM on a brand new engineering team that involved none of the UK engineers currently responsible, then it very likely that they would be unable to make progress for a long time...
Continuity of experience is a critical asset for this sort of IP, even ignoring everything else.
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If you dumped ARM on a brand new engineering team that involved none of the UK engineers currently responsible, then it very likely that they would be unable to make progress for a long time...
Alternatively, make offers to the lead engineers that can explain everything for jobs that pay $$$ in another country and you could recover much faster. It's not efficient but it's entirely doable.
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Because the original sale to Softbank came with a whole bunch of UK government imposed restrictions on what they can do. They can't just sell the company to anyone they need UK government approval or they effectively forfeit ownership. It helps that the assets are in the UK too.
Spin it off? (Score:3)
I thought I read somewhere that Softbank was also considering spinning it off as a separate company. I can't remember if that was by IPO or by just issuing shares and putting them on the market... but I'd actually love to own a piece of ARM. Maybe that's the best way to go...
Awesome news! (Score:4, Interesting)
Nvidia has proven over and over that they will screw anyone and everyone, regardless of being a partner or a customer.
They have found some kind of loophole to screw the whole industry if allowed to purchase ARM.
Proof?
Simple, they have no financial reasons to spend that much money to be able to make their own ARM cpus.
ROI would be super slow since ARM itself generates less than 5 $ billions a year.
For way less, they can obtain a proper architectural license and go wild.
But no, the intention is to pull some of their dirty tactics and fuck the whole industry.
This needs to be blocked, period.
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Prime example, Cumulus was a company specializing in an OS for third-party ethernet switches.
nVidia acquired them and a relatively minor ethernet switch player (Mellanox) and the very next release *only* supports nVidia switches. nVidia gave up the third party switch revenue to make Cumulus exclusive to their newly acquired hardware.
Owning ARM doesn't help them produce ARM architecture products, as you say, but it does let them deny licensing to others.
So the question is whether nVidia wants to secure exclu
NVDA (Score:1)
Buy the dip.
National Security is BS (Score:2)
Calling it National security is bs. Unless of course your government was strong-arming the company for backdoors (pun not intended) and selling it to a different country may expose that...
The narrative is that these are just a bunch of toy chips right. No backdoors or spying right. So then that's not an impact to National Security if they sell it.
Unless of course that's all lies.
Security? (Score:1)
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In other words... (Score:2)
...There will be a delay in the proposed takeover of ARM until the appropriate bribes have been paid.
Re: In other words... (Score:1)
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ROFL! Thanks for that. Made my day.
huh? (Score:2)
How could it be a national risk to security as it's already owned by a non UK company. Not that I object to it NOT being sold to Nvidia. But if Nvidia can't buy it due to UK security concerns, then NO US company can buy it, so not Intel, not Apple, not Microsoft, not Qualcomm or whichever US company.
Personally I would laugh my ass off if a Chinese consortium would be able to buy it.
What possible security concern? (Score:2)
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Given the current political situation in the United States (and I mean that much more broadly than Trump/Biden, Democrat/Republican), I wouldn't trust a US company one bit more than I'd trust a Russian or Chinese one. Japan is far from perfect, but its empire-building days are past, and with that passing, so, too, its penchant for international thuggery on the world stage.
Considering blocking...? (Score:2)
Of course they would (Score:2)
Not that takeover is a good idea anyway but... (Score:2)
.. why does UK think letting ARM be owned by an American company is more dangerous, from a security perspective, than a Japanese one (which it is now)?
Unless Jensen being Asian makes them worried - but again,,,
You'd think the UK govt would have been more interested in stopping the original ARM in UK_>Softbank deal.