Nvidia to Acquire Arm for $40B

Nvidia to Acquire Arm for $40B(nvidianews.nvidia.com)

2122 points by czr 5 years ago | 752 comments

DCKing 5 years ago |

This is terrible. Not really just because of Nvidia - which has a lot of problems I've previously commented on the rumors of this [1] - but Nvidia's ownership completely changes ARM's incentives.

ARM created a business model for itself where they had to act as a "BDFL" for the ARM architecture and IP. They made an architecture, CPU designs, and GPU designs for others. They had no stake in the chip making game, and they had others - Samsung, Apple, Nvidia, Qualcomm, Huawei, Mediatek, Rockchip and loads of others make the chip. Their business model was to make the ARM ecosystem accessible for as many companies as possible, so they could sell as many licenses as possible. In that way, ARM's business model enabled a very diverse and thriving ARM market. I think this is the sole reason we see ARM eating the chip world today.

This business model would continue to work perfectly fine as a privately held company, or being owned by a faceless investor company that wants you to make as much money as possible. But it's not fine if you are owned by a company that wants to use you to control their own position in the chip market. There is no way Nvidia (any other chip company, but as laid out previously Nvidia might even be more concerning) will spend 40 billion on this without them deliberately or inadvertently destroying ARM's open CPU and GPU ecosystem. Will Nvidia allow selling ARM licenses to competitors of Nvidia's business? Will Nvidia reserve ARM's best IP as a selling point for its own chips? Will Nvidia allow Mali to continue existing? Any innovations ARM made previously it sold to anyone mostly indiscriminatorily (outside of legal restrictions), but now every time the question must be asked "does Nvidia have a better propietary purpose for this?". For any ARM chip maker the situation will be that Nvidia is both your ruthless competitor, but it also sells you the IP you need to build your chips.

EDIT: ARM's interests up to last week were to create and empower as many competitors for Nvidia as possible. They were good at that and was the root of the success of the ARM ecosystem. That incentive is completely gone now.

Unless Nvidia leaves ARM alone (and why would they spend $40B on that??), this has got to be the beginning of the end of ARM's golden age.

[1]: https://news.ycombinator.com/item?id=24010821

klelatti 5 years ago | |

Precisely, plus just consider the information that Nvidia will have on all its competitors who use Arm IP.

- It will know of their product plans (as they will need to buy licenses for new products).

- It will know their sales volumes by product (as they will need to pay fees for each Arm CPU sold).

- If they need technical help from Arm in designing a new SoC then the details of that engagement will be available to Nvidia.

How does this not give Nvidia an completely unfair advantage?

DCKing 5 years ago | | |

I wouldn't use the term "unfair" here. There's also just three x86 licensees in the world and people don't usually consider that an affront. You buy, you control, that's how the world works.

But I do think it's important that we recognize that we're going from a position of tremendous competitiveness to a much less competitive situation. And that will be a situation where ARM will be tightly controlled and much less inducive to the innovation we've seen in the last years.

Wowfunhappy 5 years ago | |

To play devil’s advocate a bit, are nVidia's incentives necessarily so different? Their goal will be to make as much money as possible, and it's clear that licensing has been a winning strategy for ARM.

Samsung comes to mind as another company that makes their own TVs, phones, SSDs, ect., but is also perfectly happy to license the underlying screens and chips in those products to other companies. From my vantage point, the setup seems to be working well?

DCKing 5 years ago | | |

It could be Nvidia just wants ARM's profits and leave them alone, but I don't understand why Nvidia would spend 40 billion dollars on that. They spend 40 billion on the control of a company, why would they do that if they just would leave them be? Surely they want to exercise that control in some way for their own goals. Especially a company like Nvidia which (in my linked comment) has a proven track record of not understanding how to collaborate with others.

EDIT: Let's be clear that ARM's incentive last week was to create and empower as many competitors for Nvidia as possible. They were good at that and was the root of the success of the ARM ecosystem. That incentive is completely gone now.

I'm guessing Samsung has a track record where I'd feel a little more confidence in the situation if they'd taken over ARM here, but in general ARM's sale to Softbank and thereby its exposure to lesser competitive interests has been terrible. They could have remained a private company.

klelatti 5 years ago | | |

How do we know that Samsung hasn't stifled some potential competitors by refusing to sell them screens or by selling them an inferior product?

marcosdumay 5 years ago | | |

Screen manufacture is a highly competitive market. ARM licensing isn't.

captainbland 5 years ago | | |

The main difference I'd say is that ARM holds more of a potentially captive industry that is totally intertwined with its IP. Most of the products that Samsung sell to other industries are more or less fungible with products that other third parties sell but the ARM design rights are going to be incredibly difficult to replace. Entire ecosystems of electronics and software are built on it.

There's a whole lot of inertia for Nvidia to take advantage of here while the rest of the industry figures out where it's going.

starfallg 5 years ago | | |

The reason that ARM is only worth 30-40 billion while powering nearly all smartphones and much of the embedded space is because their business model is not that profitable. If Nvidia is looking for profits, ARM is a bad investment. If they are looking for synergies to boost nVidia profits, it will be done at the expense of other licensees. That's exactly what people fear.

dv_dt 5 years ago | | |

Didn't Samsung stopping selling flash chips to ouside parties when it suited them?

013a 5 years ago | |

I tend to agree, but there may be another angle to this which could prove beneficial to consumers. Right now, the only ARM chips which are actually competitive with desktop chips are from Apple, and are obviously very proprietary. If this acquisition enables Nvidia to begin producing ARM chips at the same level as Apple (somehow, who's to say how, that's on them) then that would help disrupt the AMD/Intel duopoly on Windows. Its been a decade; Qualcomm has had the time to try and compete here, and has failed miserably.

I doubt Nvidia would substantially disrupt or cancel licensing to the many third-rate chip designers you listed. But, if they can leverage this acquisition to build Windows/Linux CPUs that can actually compete with AMD and Intel, that would be a win for consumers. And Nvidia has shown interest in this in the past.

Yes, its a massive disruption to the status quo. But it may be a good one for consumers.

klelatti 5 years ago | | |

But Nvidia has an Arm architecture license already - the same as Apple - so can build Arm chips to whatever design it wants (and it does in Tegra).

This is nothing to do with extending Nvidia's ability to use Arm IP in its own products.

ZuLuuuuuu 5 years ago | | |

The failed "Windows on Snapdragon" experiment is not because of the fault of Qualcomm but Microsoft's. Qualcomm consistently released chips for PCs since Snapdragon 835 and the chips are pretty competitive in raw power compared to Intel. But even some of Microsoft's own software is not compiled natively for ARM leading to bad performance. No 64-Bit emulation means a lot of programs users download does not work at all. .Net Framework which is probably the most popular .Net framework for Windows programs is not compiled for ARM either so people who want to compile their apps need to first transition to .Net Core, and this wasn't even an option a year ago (because of lack of missing parts in .Net Core). So Microsoft is to blame for the handling of the Windows on Snapdragon experiment.

pier25 5 years ago | |

> There is no way Nvidia will spend 40 billion on this without them deliberately or inadvertently destroy ARM's open CPU and GPU ecosystem

But why would a company spend that much money to buy a company and destroy it afterwards?

DCKing 5 years ago | | |

Nvidia will certainly try to get as much money out of ARM's R&D capabilities, existing IP, and future roadmap as they can. They will get their money's worth - at worst they will fail trying. In that sense, they won't destroy "ARM the company" or "ARM the IP". But Nvidia will have no interest in maintaining ARM's business model whereby ARM fosters a community of Nvidia competitors - they have an interest to the opposite. Therefore they very likely will destroy "ARM the ecosystem".

bwanab 5 years ago | | |

It’s not going to destroy the business it’s going to destroy the current business model. The point is that the only way this deal can make sense for Nvidia, is to use ARM’s IP as a competitive advantage over other competitors. Until now, ARM’s value proposition has been IP neutrality for the various user companies.

batmansmk 5 years ago | | |

Oracle and Sun at $8B.

gorbachev 5 years ago | | |

They figure they can make more than $40B by driving ARM to the ground?

Personally I don't think that's true in this particular case, but the strategy isn't exactly unheard of.

ltbarcly3 5 years ago | | |

https://songma.github.io/files/cem_killeracquisitions.pdf

melbourne_mat 5 years ago | |

I think it's wonderful news that Arm is joining the ranks of giant American tech oligopolies. This is a win for freedom and increases prosperity for all.

ngcc_hk 5 years ago | | |

Both Apple and windows has arm implementation. In fact with Apple it is arm not risc/v we are looking at. Can Nvidia bring competition or instead destroy arm ... wonder if he wants to destroy what a cpu ip or competition it pay 40B to destroy. What does it want from the deal ? And what will it get from the deal ? Any past deal we can gauge ? Oracle buy sun is the worst scenario.

edderly 5 years ago | |

I agree with the general sentiment here, but ARM is not exactly Snow White. It's an open secret that ARM was (and still is) selling the CPU design at a discount if you integrated their Mali (GPU). This isn't relevant to Nvidia today, but it was when they were in the mobile GPU space. Also this caused obvious problems for IMGtec and other smaller GPU players like Vivante.

Followerer 5 years ago | | |

" It's an open secret that ARM was (and still is) selling the CPU design at a discount if you integrated their Mali (GPU)."

Why is that bad? Not only it's common business practice (the more you buy from us, the cheaper we sell), it also makes sense from the support perspective. Support the integration between their cores and a different GPU would be more work for them than integration of their cores with their own GPUs.

That's why companies expand to adjacent markets: efficiency.

A completely different thing would be to say: "if you want our latest AXX core, you have to buy our latest Mali GPU". That's bundling, and that's illegal.

hajile 5 years ago | | |

Bundling isn't necessarily anti-competitive provided ARM isn't taking a loss selling their chip. I'll admit that things aren't actually free-market here because copyright and patent monopolies apply.

There are three possibilities here: ARM's design is approximately the same as the competitory, ARM's design is inferior to the competitor, and ARM's design is superior to the competitor.

If faced with two equivalent products, staying with the same supplier for both is best (especially in this case where the IP isn't supply-limited). The discount means a reduction in costs to make the device. Instead of ARM making a larger profit, their customers keep more of their money. In turn, the super-competitive smartphone market means those savings will directly go to customers.

In cases where ARM's design is superior, why would they bundle? If they did, getting a superior product at an even lower price once again just means less money going to the big corporation and more money that stays in the consumer's pocket.

The final case is where ARM has an inferior design. I want to sell the most performance/features for the price so I can sell more phones. I have 2 choices: slight discount on the CPU but bundled with an inferior GPU or full price for the CPU and full price for a superior GPU. The first option lowers phone price. The second option offers better features and performance. For the high-end market, I'm definitely not going with the discount because peak performance reigns supreme. In the lesser markets, its a calculation of price for total performance and the risk that consumers might prefer an extra few FPS for the cost of another few dollars.

Finally, there are a couple small players like Vivante or Imagination Technologies, but the remaining competitors in the space (Intel, AMD, Nvidia, Qualcomm, Samsung, etc) aren't going to be driven under by bundle deals, so bundling seems to be pretty much all upside for consumers who stand to save money as a result.

DCKing 5 years ago | | |

I'm sure that ARM is not a saint here in the sense that they would also have an incentive to milk their licensees as much as possible. Now they will keep having that incentive, but also the terrible incentive to actively outcompete their licensees which is much worse.

ksec 5 years ago | | |

>I agree with the general sentiment here, but ARM is not exactly Snow White. It's an open secret that ARM was (and still is) selling the CPU design at a discount if you integrated their Mali (GPU).

It is actually the other way around. ARM is more like giving the Mali GPU for free ( or at a very low cost ) if you use their CPU.

>Also this caused obvious problems for IMGtec

Yes, part of the reason why PowerVR couldn't get more traction and Apple were unhappy with their GPU pricing.

klelatti 5 years ago | | |

Bundling is not necessarily problematic: it happens at your local supermarket all the time!

What would be an issue would be if Arm used their market power in CPUs to try to control the GPU market - e.g. you can't have the latest CPU unless you buy a Mali GPU with it.

spfzero 5 years ago | |

Exactly, there is no way ARM is worth 40 B to Invidia, unless they are going to use it to arm-twist their competition.

Just look at ARMs annual net, multiply by 10, multiply that by 2 assuming starry-eyed optimism about you being better at generating value from ARM IP, you’re still far from 40 billion.

ksec 5 years ago | |

>Will Nvidia allow selling ARM licenses to competitors of Nvidia's business?

Like AMD? Sure. None of the ARM IP compete with Nvidia much. Not to mention by "Not" Selling to AMD it create more problem for its $40B asset than anyone could imagine.

>Will Nvidia reserve ARM's best IP as a selling point for its own chips? Will Nvidia allow Mali to continue existing?

Sure. Mali dont compete with Nvidia at all. Unless Nvidia will put up their CUDA Core for IP licensing with similar price and terms to Mali. Could they kill it or raise the price of Mali? Sure. But there is always PowerVR. Not to mention AMD is also licensing out Radeon IP to Mobile. Mostly because AMD dont / cant compete in that segment.

>Unless Nvidia leaves ARM alone (and why would they spend $40B on that??)

It has more to do with Softbank being an Investor. They were already heavily invested in Nvidia. And they need money, they want out. And seriously no one sane would buy ARM for $40B ( It is actually $35B, with $5B as performance bonus, the number $40 was likely used only for headline. ) As a matter of fact I would not be surprised if Softbank promise to buy it back someday. This also paint a picture of how desperate Son / Softbank needs those Cash. So something is very wrong. ( Cough WeWork Cough )

But I do understand your point. Conflict of Interest. Similar to Apple wouldn't want to build their Chip in Samsung Foundry.

While I would have liked ARM to remain independent. I am not as pessimistic as some have commented. And normally I am the one who had people pointing at my pessimism.

On the optimistic side of things. There are quite a lot of cost could be shared with the tools used for TSMC and Samsung Foundry implementation. ( Nvidia is now in bed with Samsung Foundry ) For ARM that means higher margin, for its customers that mean access to Samsung Foundry Capacity where previously they are stuck with TSMC. Nvidia also gets to leverage ARM's expertise in licensing, so their Nvidia GPU could theoretically enter new market. The real IP with Nvidia isn't so much about the GPU design, but its Drivers and CUDA. So may be Nvidia could work towards being an Apple like "Software" company that works with specific Hardware. ( Pure Speculation only )

There are lots of talk about Nvidia and ARM. While I dont think the marriage make perfect sense, It is not all bad. There are more interesting point no one is talking about. Marvell, AMD, Xillix and may be Broadcom. The industry is consolidating rapidly because designing leading edge chip, even with the cheap IP licensing is now becoming very expensive. And the four mentioned above have less leverage than their competitors.

Interest Times.

oldschoolrobot 5 years ago | |

exactly

Blammar 5 years ago |

No one has seemed to notice the following two things:

"To pave the way for the deal, SoftBank reversed an earlier decision to strip out an internet-of-things business from Arm and transfer it to a new company under its control. That would have stripped Arm of what was meant to be the high-growth engine that would power it into a 5G-connected future. One person said that SoftBank made the decision because it would have put it in conflict with commitments made to the U.K. over Arm, which were agreed at the time of the 2016 deal to appease the government." (from https://arstechnica.com/gadgets/2020/09/nvidia-reportedly-to... )

and

"The transaction does not include Arm’s IoT Services Group." (nvidia news.)

which appear to contradict each other.

I'm not sure about the significance of this. I would have guessed Nvidia would have wanted the IoT group to remain.

Also, to first order, when a company issues stock to purchase another corporation, that cost is essentially "free" since the value of the corporation increases.

In other words, Nvidia is essentially paying $12 billion in cash for ARM up front, and that's all. (The extra $5B in cash or stock depends on financial performance of ARM, and thus is a second-order effect.)

fishermanbill 5 years ago |

When will Europe realise that there is no second place when it comes to a market - the larger player will always eventually end up owning everything.

I can not put into words how furious I am at the UK's Conservative party for not protecting our last great tech company.

Europe has been fooled into the USA's ultra free market system (which works brilliantly for the US but is terrible for everybody else). As such American tech companies have brought EVERYTHING and eventually moth balled them.

Take Renderware it was the leading game engine of the PS2 era consoles, brought by EA and mothballed. Nokia is another great example brought by Microsoft and mothballed. Imagination Technologies was slightly different in that it wasn't bought but Apple essentially mothballed them. Now ARM will undoubtedly be the next via an intermediate buyout.

You look across Europe and there is nothing. Deepmind could have been a great European tech company - it just needed the right investment.

zdw 5 years ago |

I see this going a few ways for different players:

The perpetual architecture license folks that make their own cores like Apple, Samsung, Qualcomm, and Fujitsu (I think they needed this for the A64FX, right?) will be fine, and may just fork off on the ARMv8.3 spec, adding a few instructions here or there. Apple especially will be fine as they can get code into LLVM for whatever "Apple Silicon" evolves into over time.

The smaller vendors that license core designs (like the A5x and A7x series, etc.) like Allwinner, Rockchip, and Broadcom are probably in a worse state - nVidia could cut them off from any new designs. I'd be scrambling for an alternative if I were any of these companies.

Long term, it really depends on how nVidia acts - they could release low end cores with no license fees to try to fend off RISC-V, but that hasn't been overly successful when tried earlier with the SPARC and Power architectures. Best case scenario, they keep all the perpetual architecture people happy and architecturally coherent, and release some interesting datacenter chips, leaving the low end (and low margin) to 3rd parties.

Hopefully they'll also try to mend fences with the open source community, or at least avoid repeating past offenses.

ChuckMcM 5 years ago |

And there you have it. Perhaps the greatest thing to happen to RISC-V since the invention of the FPGA :-).

I never liked Softbank owning it, but hey someone has to.

Regarding the federal investment in FOSS thread that was here perhaps CPU architecture would be a good candidate.

ibains 5 years ago |

I love this, I was amongst early engineers on CUDA (compilers).

NVIDIA was so well run, but boxed into a smaller graphics card market - ATI and it were forced into low margins since they were made replaceable by OpenGL and DirectX standards. For the standard fans - they resulted a wealth transfer from NVIDIA to Apple etc. and reduced capital available for R&D.

NVIDIA was constantly attacked by a much bigger Intel (which changed interfaces to kill products and was made to pay by a court)

Through innovation, developing new technologies (CUDA) they increased market cap, and have used that to buy Arm/Mellanox.

I love the story of the underdog run by a founder, innovating it’s way to getting into new markets against harsh competition. Win for capitalism!

enragedcacti 5 years ago | |

Nvidia might have been an underdog once, but they are now the world's largest chipmaker, even surpassing Intel.

https://www.extremetech.com/computing/312528-nvidia-overtake...

mhh__ 5 years ago | | |

And Intel's revenue remains 700% larger than Nvidia's

verall 5 years ago | | |

Samsung and TSMC are both worth more. America's largest chipmaker.

justicezyx 5 years ago | |

The comment identified the positive side of the nvidia story. Note that nvidia had not had large acquisition for many years.

This acquisition can be seen as a beacon of nvidia's past struggle against the market and the competitors.

For whatever happened, nvidia innovated to their success, and had enabled possibly the biggest tech boom so far through deep learning. Might be one day everyone claimed nvidia to be the "most important company" on earth.

llukas 5 years ago | | |

> The comment identified the positive side of the nvidia story. Note that nvidia had not had large acquisition for many years.

Not correct Mellanox was bought for $7B.

walterbell 5 years ago |

Talking points from the founders of Arm & Nvidia: https://www.forbes.com/sites/patrickmoorhead/2020/09/13/its-...

> Huang told me that first thing that the combined company will do is to, “bring NVIDIA technology through Arm’s vast network.” So I’d expect NVIDIA GPU and NPU IP to become available quickly to smartphone, tablet, TV and automobile SoC providers as quickly as possible.

> Arm CEO Simon Segars framed it well when he told me, “We're moving into a world where software doesn't just run in one place. Your application today might run in the cloud, it might run on your phone, and there might be some embedded application running on a device, but I think increasingly and with the rollout of 5g and with some of the technologies that Jensen was just talking about this kind of application will become spread across all of those places. Delivering that and managing that there's a huge task to do."

> Huang ... “We're about to enter a phase, where we're going to create an internet that is thousands of times bigger than the internet that we enjoy today. A lot of people don't realize this. And so, so we would like to create a computing company for this age of AI.”

paulpan 5 years ago |

My initial reaction is that this reminiscent of the AMD-ATI deal back in 2006. It almost killed both companies and comparatively, this deal size is much bigger ($40B vs. $6B) for both a more mature industry and companies involved.

$40B is an obscene lot of money objectively and what's the endgame for Nvidia? If it's to "fuse" ARM's top CPU designs with their GPU prowess, then couldn't they invest the money to restart their own CPU designs (e.g. Carmel)? My inner pessimist, as with others here, is that Nvidia will somehow cripple the ARM ecosystem or prioritize their own needs over those of other customers'. Perhaps an appropriate analogy is Qualcomm's IP licensing shenanigans and how they've crippled the non-iOS smartphone industry.

That said, there's also examples of companies making these purchases with minimal insidious behavior and co-existing with their would-be competitors: Microsoft's acquisition of Github, Google's Pixel smartphones, Sony's camera lenses business and even Samsung, which supposedly firewalls its components teams so the best tech is available to whoever wants (and is willing to pay for it).

I suppose if this acquisition ends up going through (big if), then we'll see Nvidia's true intent in 3-5 years.

dijit 5 years ago | |

I see two ways of it playing out for Nvidia:

1) Adoption of ARM CPU's (AWS Graviton, rPi etc) will cause software to be adapted to ARM anyway, meaning: Nvidia could come out with a full vertically integrated cloud.

2) Leveraging full vertical integration with ML based super computers.

acuozzo 5 years ago | |

> what's the endgame for Nvidia?

Announced at ARM TechCon last year: https://www.arm.com/products/silicon-ip-cpu/ai-platform

PragmaticPulp 5 years ago |

I’m not convinced this is a death sentence for ARM. I doubt nVidia spent $40b on a company with the intention of killing it’s golden goose business model. The contractual agreements might change, but ARM wasn’t exactly giving their IP away for free before this move.

MattGaiser 5 years ago | |

It is less about them intentionally killing it and more about their culture and attitude killing it.

asdfasgasdgasdg 5 years ago | | |

Does Nvidia have a habit of killing acquisitions? I'm only familiar with their graphics business, but as far as I can see the only culture going on there is excellence.

ckastner 5 years ago |

Softbank paid $32B for ARM in 2016.

A 25% gain over a horizon of four years is not bad for your average investment -- but this isn't an average investment.

First, compared to the SP500, this underperforms over the same horizon (even compared to end of 2019 rather than the inflated prices right now).

Second, ARM's sector (semiconductors) has performed far, far better in that time. The PHOX (Philadelphia Semiconductor Index) doubled in the same time period.

And looking at AMD and NVIDIA, it feels as if ARM would have been in a position to benefit from the surrounding euphoria.

On the other hand, unless I'm misremembering, ARM back then was already considered massively overvalued precisely because it was such a prime takeover target, so perhaps its the $32B that are throwing me off here.

yreg 5 years ago | |

It vastly overperforms the Softbank ventures we usually hear about (excluding BABA).

smcl 5 years ago | | |

To be honest, cash deposited in a boring current account outperforms Softbank's Vision Fund

lrem 5 years ago | |

There's also a fundamental threat to ARM in the raise of RISC-V.

janoc 5 years ago | | |

RISC-V is only a tiiny player in the low end embedded space (there are only a few parts actually available with that instruction set) and no competition at all at the high end.

Maybe in a decade or so it may be more relevant but not today. Calling this a "fundamental threat" is a tad exaggerated.

redwood 5 years ago |

The British should never have allowed foreign ownership of their core tech

bencollier49 5 years ago | |

I'm so exercised about this that I'm setting up a think tank to actively discuss UK control of critical tech (and "golden geese" as per others in this thread). If you're in tech and have a problem with this, please drop me a line, I'm @bencollier on Twitter.

ranbumo 5 years ago | |

Yes. It'd have been reasonable to block sales to non eu parties for national security reasons.

Now arm is yet another US company.

scarface74 5 years ago | | |

Isn’t the UK leaving the EU?

hajile 5 years ago | |

Britain and the US are politically, and economically entwined with each other. As a country, keeping core technology at home is tied to defense (don't buy your guns from your competitor). If they don't intend to go to war with the US, then there isn't any real defense loss (I'd also point out that making IP "blueprints" for a core is different from manufacturing the core itself). If Britain were to have a real issue, it would be the US locking down F35 jets they sell to their allies.

jasoneckert 5 years ago |

Most tech acquisitions are fairly bland - they often maintain their separate ways for several years with a bit of integration. Others satisfy a political purpose or serve to stifle competition.

However, given the momentum of Nvidia these past several years alongside the massive adoption and evolution of ARM, this is probably going to be the most interesting acquisition to watch over the next few years.

zmmmmm 5 years ago |

Many various reasons for this but one perspective I am curious about is how much this is actually a defensive move against Intel, because nVidia knows Intel is busy developing dedicated graphics via Xe, and if nVidia just allows that to continue they are going to find themselves simultaneously competing with and dependent on a vendor that owns the whole stack that their platform depends on. It is not a place I would want to be, even accounting for how incompetent Intel seems to have been for the last 10 years.

Edit: yes I meant nVidia not AMD!

jml7c5 5 years ago | |

How does AMD enter into this? Did you mean Nvidia?

zmmmmm 5 years ago | | |

ouch I wrote a whole comment and systematically replaced Nvidia with AMD ... kind of impressive.

Thanks!

Tehdasi 5 years ago | |

Intel has been promising high-end graphics for decades, and delivering low end integrated graphics as a feature for their CPUs. Which makes sense, the market for CPUs is worth more than the market for game oriented GPUs. The rise of GPUs used in AI might change this calculation, but I doubt it. I suspect that nVidia just would like to move into the CPU market.

fluffything 5 years ago | |

Nvidia could have bought a world-class CPU architects team, and build their own ARM or RISC-V chips (NVIDIA has an infinite ARM license already).

UncleOxidant 5 years ago |

On the bright side, this could end up being a big boost for RISC-V.

nickt 5 years ago | |

Probably worth a second look at this RISC desktop thread

https://news.ycombinator.com/item?id=19118642

kristianpaul 5 years ago | |

Indeed, looking right now at https://rioslab.org/.

miguelmota 5 years ago | |

Would love to see RISC-V catch up and be more widely adopted.

m00dy 5 years ago | |

and this would be killer for intel

hajile 5 years ago | | |

Even if/when RISCV takes over, Intel and AMD will be in a unique position to offer "combination" chips with both x86 and RISCV cores which could milk the richest enterprise and government markets for decades to come.

UncleOxidant 5 years ago | | |

Maybe? But somehow I don't think they'll be able to capitalize on it because Intel.

ykl 5 years ago |

I wonder what this means for NVIDIA's recent RISC-V efforts [1]. Apparently they've been aiming to ship (or already have been shipping?) RISC-V microcontrollers on their GPUs for some time .

[1] https://riscv.org/wp-content/uploads/2017/05/Tue1345pm-NVIDI...

alexhektor 5 years ago |

None of the top comments disuss the possibility of the deal not going through due to antitrust or other concerns by regulators. While it's owned by a Japanese company and being sold to an American one, China most likely doesn't approve and it could be a diplomatic issue due to security and intelligence concerns?

Not sure how relistic that scenario is, although I personally can very much see this being used as a negotiation vehicle, depending on the actual security concern (I'm obviously not an expert there..)

[1] https://www.globaltimes.cn/content/1200871.shtml

throwaway4good 5 years ago |

Qualcomm and Apple are going to be fine even with NVIDIA owning ARM. They are American companies under the protection of US legislation and representation.

However the situation for Chinese companies is even clearer now. Huawei, Hikvision etc. need to move away from ARM. Probably on to their own thing as RISC-V is dominated by US companies.

vaxman 5 years ago | |

Qualcomm, Apple and NVidia will lose favor with the US government unless they bring (at least a full copy of) their FAB partners and the rest of their supply chains home to America (Southwest including USMCA zone). We love Southeast Asia, but the pandemic highlighted our vulnerability and, as a country, we’re not going to keep sourcing our critical infrastructure in China —or it’s back yard. If those American CEOs keep balking at the huge investment required, you will see the US government write massive checks to Intel (has numerous, albeit obsolete, domestic FABs), DELL and upstarts (like System76 in Colorado) to pick winners, while the elevator to hell gains a new stop in Silicon Valley and San Diego (nationalizing patents, etc) during a sort of “war effort” like we had in the early 1940s.

sharken 5 years ago |

Related discussions: https://news.ycombinator.com/item?id=24009177

https://news.ycombinator.com/item?id=24173539

https://news.ycombinator.com/item?id=24454958

someperson 5 years ago | |

and https://news.ycombinator.com/item?id=24467989

nl 5 years ago |

Just noting that Apple doesn't have a perpetual license, they have an architecture license[1], including for 64bit parts[2].

This allows them to design their own cores using the Arm instruction set[3] and presumably includes perpetual IP licenses for Arm IP used while the license is in effect. New Arm IP doesn't seem to be included, since existing 32bit Arm licensees had to upgrade to a 64bit license[2].

[1] https://www.anandtech.com/show/7112/the-arm-diaries-part-1-h...

[2] https://www.electronicsweekly.com/news/business/finance/arm-...

[3] https://en.wikipedia.org/wiki/ARM_architecture#Architectural...

throw_m239339 5 years ago |

Tangential, but when I hear about all these insane "start-up du jour" valuations, does anyone else feel like $40B isn't a lot of a hardware company sur as ARM?

beervirus 5 years ago | |

$40 billion is a real valuation though, as opposed to WeWork’s.

incognition 5 years ago | | |

Maybe referencing Nikola?

broknbottle 5 years ago | | |

are you suggesting a bunch of office space leases that are fully stocked with beer is not worth $40 billion?

krick 5 years ago |

We've been repeating the word "bad" for the last couple of weeks here, but I don't really remember any insights on what can happen long term (and I'm asking, because I have absolutely no idea). I mean, let's suppose relationships with Qualcomm don't work out (which we all kind of suspect already). What's the alternative? Is it actually possible to create another competitive architecture at this point? Does it take 5, 10 years? Is there even a choice for some other (really big) company, that doesn't want to depend on NVIDIA?

axaxs 5 years ago |

This seems fair, as long as it stays true(regarding open licensing and neutrality). I've mentioned before, I think this will ultimately be a good thing. NVidia has the gpu chops to really amp up the reference implementation, which is a good thing for competition in the mobile, settop, and perhaps even desktop space.

WhyNotHugo 5 years ago |

This it terrible news for the FLOSS community.

Nvidia has consistently for many years refused to properly support Linux and other open source OSs.

Heck, Wayland compositors just say "if you're using nvidia then don't even try to use our software" since they're fed up of Nvidia's lack of collaboration.

I really hope ARM doesn't go the same way. :(

janoc 5 years ago | |

ARM itself has little to no impact on open source community. They only license chip IP, they don't make any chips themselves. And most of the ARM architecture is documented and open, with the exception of things like the MALI GPU.

Whether or not some SoC (e.g. in a phone) is going to be supported by Linux doesn't depend on ARM but on the manufacturer of the given chip. That won't change in any way.

ARM maintains the GCC toolchain for the ARM architecture but that is unlikely to go anywhere (and even if it did, it is open source and anyone else can take it over).

The much bigger problem is that Nvidia could now start putting squeeze on chip makers who license the ARM IP for their own business reasons - Nvidia makes its own ARM-based ICs (e.g. the Jetson, Tegra) and it is hard to imagine that they will not try to use their position to stiffle the competition (e.g. from Qualcomm or Samsung).

hajile 5 years ago | | |

https://developer.arm.com/tools-and-software/open-source-sof...

ARM directly maintains the main ARM parts of the Linux kernel among other things.

WhyNotHugo 5 years ago | | |

> And most of the ARM architecture is documented and open

That's exactly the thing -- nvidia refuses to document their products, so third parties can't support it.

Should they extend their practices to ARM, then ARM support will quickly whither.

jpswade 5 years ago |

I feel like this is yet more terrible news for the UK.

m0zg 5 years ago |

On the one hand, this is bad news - I would prefer ARM to remain independent. But on the other, from a purely selfish standpoint, NVIDIA will likely lean on Apple pretty hard to get its GPUs into Apple devices again, which bodes well for GPGPU and deep learning applications.

Apple is probably putting together a RISC-V hardware group as we speak. The Jobs ethos will not allow them to depend this heavily on somebody else for such a critical technology.

buzzerbetrayed 5 years ago | |

A few weeks ago there were rumors that ARM was looking to be sold to Apple and Apple turned them down. If an NVIDIA acquisition is such a deal breaker for Apple, why wouldn't they have just acquired ARM to begin with?

totorovirus 5 years ago |

nvidia is notorious for being not nice to oss developers as Linus Torvalds claims: https://www.youtube.com/watch?v=iYWzMvlj2RQ&ab_channel=Silic...

I wonder how Linux would react to this news.

maxioatic 5 years ago |

> Immediately accretive to NVIDIA’s non-GAAP gross margin and EPS

Can someone explain this? (From the bullet points of the article)

I looked up the definition of accretive: "characterized by gradual growth or increase."

So it seems like they expect this to increase their margins. Does that mean ARM had better margins than NVIDIA?

Edit: I don't know what non-GAAP and EPS stand for

bluejay2 5 years ago | |

You are correct that it means they expect margins to increase. One possibility is that ARM has higher margins as you mentioned. Another is that they are making some assumptions about how much they can reduce certain expenses by, and once you factor in those savings, margins go up.

tyingq 5 years ago | |

I would guess they do have higher margins since they are mostly selling licenses and not actual hardware.

This article is old, but suggests a 48% operating margin: https://asia.nikkei.com/NAR/Articles/ARM-posts-strong-profit...

ericmay 5 years ago | |

EPS -> earnings per share

Non-GAAP -> doesn’t follow generaly accepted accounting practices. There are alternative accounting methods. GAAP is very US-centric (not good or bad, just stating a fact).

salawat 5 years ago | | |

Though note the intent of GAAP is to cut down on "creative accounting" which can tend to mislead.

pokot0 5 years ago | |

GAAP is an accounting set of rules, EPS is Earning per Share. Basically means they think it will increase their gross margin and EPS but you can't sue them if it does not.

zeouter 5 years ago |

Eeek. My gut reaction to think is.. could we have less powerful conglomerates.. please?

Lind5 5 years ago |

Arm’s primary base is in the IoT and the edge, and it has been very successful there. Its focus on low power allowed it to shut out Intel from the mobile phone market, and from there it has been gaining ground in a slew of vertical markets ranging from medical devices to Apple computers. But as more intelligence is added to the edge, the next big challenge is to be able to radically improve performance and further reduce power, and the only way to make that happen is to more tightly customize the algorithms to the hardware, and vice versa https://semiengineering.com/nvidia-to-buy-arm-for-40b/

MangoCoffee 5 years ago |

https://semiwiki.com/ip/287846-tears-in-the-rain-arm-and-chi...

Does this mean Nvidia will have to deal with the hot mess at China ARM?

justincormack 5 years ago | |

Allegedly it has been sorted, before this deal was announced. No idea how.

hastradamus 5 years ago |

Why would Nvidia spend $40B to ruin Arm? I can't see them making a return on this investment. No one wants to work with Nvidia they are notoriously roothless. I'm sure everyone is making plans to move to something else ASAP. Maybe RISC-V

mzs 5 years ago | |

Some decision makers there dislike Apple that much.

peterburkimsher 5 years ago |

Sounds like everyone is rallying around RISC-V. What does this mean for MIPS?

"ARM was probably what sank MIPS" - saagarjha

https://news.ycombinator.com/item?id=24402107

Zigurd 5 years ago | |

Wave owns MIPS, about which I had no idea and googling that also returns that Wave went Chapter 11 this year.

bleepblorp 5 years ago |

This isn't going to do good things for anyone who doesn't own a lot of Nvidia stock.

This is going to do especially bad things for anyone who needs to buy a cell phone or the SoC that powers one. There's no real alternative to ARM-based phone SoCs. Given Nvidia's business practices, any manufacturer who doesn't already have a perpetual ARM license should expect to have to pay a lot more money into Jensen Huang's retirement fund going forward. These costs will be passed on to consumers and will also provide an avenue for perpetual license holders to raise their consumer prices to match.

jacques_chester 5 years ago | |

> This isn't going to do good things for anyone who doesn't own a lot of Nvidia stock.

If it makes you feel any better, studies of acquisitions show that most of them are duds and destroy acquirer shareholder value.

imtringued 5 years ago | | |

Well, the commenter is actively worried about Nvidia destroying shareholder value. If you destroy ARM in the process of acquiring it the combined company will be worth less in the long run. If the acquisition was actually motivated by synergy then Nvidia could have gotten away with a much cheaper license from ARM.

bgorman 5 years ago | |

Android worked on x86 and MIPS in the past, it could presumably be ported to work with RISC-V

janoc 5 years ago | | |

You would first need an actual working RISC-V silicon that it would be worth porting to. Not the essentially demo chips with poor performance that are around now.

RISV-V is a lot of talk and hype but the actual silicon that you could buy and implement into a product is hard to come by. With the exception of a few small microcontroller efforts (GigaDevice, Sipeed).

bleepblorp 5 years ago | | |

Android still works on x86-64; indeed there are quite a few actively maintained x86-64 Android ports that are used, both on bare metal PCs and virtualized, for various purposes.

The problem is that there are no x86 SoCs that are sufficiently power efficient to be battery-life competitive with ARM SoCs in phones.

Zigurd 5 years ago | | |

MIPS support was removed from the Android NDK, though older versions of the NDK stand a good chance of working, still. So app developers with components needing the NDK support have a bit of work to remain compatible.

saagarjha 5 years ago | | |

It might pretty much work today, perhaps with a few config file changes.

yangcheng 5 years ago |

I am surprised that no one has mentioned China will very likely block this deal.

mnd999 5 years ago | |

I really hope so. The UK government should block it also, but I don't think they will.

zaptrem 5 years ago | |

On what grounds/with what authority?

genocidicbunny 5 years ago | | |

Is it that hard to see that China might see this as an American company further monopolizing silicon tech, potentially cutting China off from Arm designs.

But more to the point, this is also China. If you want to do business in China, you're going to do as they tell you, or you get the stick. And if you don't like it, what are you going to do?

yangcheng 5 years ago | | |

is this a question or just sarcasm? The post said clearly "The proposed transaction is subject to customary closing conditions, including the receipt of regulatory approvals for the U.K., China, the European Union and the United States. Completion of the transaction is expected to take place in approximately 18 months."

incognition 5 years ago | |

Are you thinking retribution for Huawei?

ttflee 5 years ago | | |

China de-facto blocked Qualcomm-NXP merger during a trade talk by not providing a decision before the deadline to the deal.

runeks 5 years ago |

The root problem here is the concept of patents -- at least as far as I can see.

If patents did not exist, and nVidia were to close down ARM and tell people "no more ARM GPUs; only nVidia GPUs from now on", then a competitor who offers ARM-compatible ISAs would quickly appear. But in the real world, nVidia just bought the monopoly rights to sue such a competitor out of existence.

It's really no wonder nVidia did this given the profits they can extract from this monopoly (on the ARM ISA).

filereaper 5 years ago |

Excellent, can't wait for Jensen to pull out a Cortex A-78 TI from his oven next year. /s

broknbottle 5 years ago | |

hodl out for the Titan A-78 Super if you can, I hear it runs a bit faster

hyperpallium2 5 years ago |

edge-AI!

They're also building an ARM supercomputer at Cambridge, but server-ARM doesn't sound like a focus.

I'm just hoping for some updated mobile Nvidia GPUs... and maybe the rumoured 4K Nintendo Switch.

They say they won't muck it up, and it seems sensible to keep it profitable:

> As part of NVIDIA, Arm will continue to operate its open-licensing model while maintaining the global customer neutrality that has been foundational to its success, with 180 billion chips shipped to-date by its licensees.

fluffything 5 years ago | |

> but server-ARM doesn't sound like a focus.

ARM doesn't have good server CPU IP. Graviton, A64FX, etc. belong to other companies.

Followerer 5 years ago | | |

Graviton is Neoverse, ARM's Neoverse.

ianai 5 years ago |

They sure seem to be marketing this as a logical move for their AI platform.

mikorym 5 years ago |

Wow, didn't someone call this out recently on HN? I mean, someone mentioned that this was going to happen. (Or rather, feared that this was the direction things were going in.)

On a different topic, how would this influence Raspberry Pis going forward?

paxys 5 years ago |

No doubt because Softbank was facing investor pressure to make up for their losses.

easton 5 years ago |

Could Apple hypothetically use their perpetual license to ARM to license the ISA to other manufacturers if they so desired? (not that they do now, but it could be a saving grace if Nvidia assimilated ARM fully).

Wowfunhappy 5 years ago | |

I'm pretty sure they can't, but I also think there's no way in hell they'd do it if they could. It's not in Apple's DNA. Better for them if no one else has access to the instruction set.

I bet they'd make a completely custom ISA if they could. Heck, maybe they plan to some day, and that's why they're calling the new Mac processors "Apple Silicon".

pier25 5 years ago | | |

> I bet they'd make a completely custom ISA if they could. Heck, maybe they plan to some day, and that's why they're calling the new Mac processors "Apple Silicon".

That was my first thought.

I'd be surprised if Apple wasn't already working on this.

mhh__ 5 years ago | | |

I could see apple being the next in line of basically failed VLIW ISAs - the cost/benefit doesn't really add up to completely redesign, prove, implement, and support a new ISA unless it was worth it technologically.

If they could pull it off I would be very impressed.

exikyut 5 years ago | | |

Thinking about that though, from a technical perspective keeping the name but changing the function would only produce bad PR.

- "We changed from the 68K to PPC" "Agh!...fine"

- "We changed from PPC to x86" "What, again?"

- "We changed from x86 to Apple Silicon" "...oooo...kay..."

- "We changed from Apple Silicon to, uh, Apple Silicon - like it's still called Apple Silicon, but the architecture is different" "What's an architecture?" "The CPU ISA." "The CPU is a what?"

pokot0 5 years ago | |

Why would they ever want to enable their competitors?

newsclues 5 years ago | | |

To spite nVidia.

netheril96 5 years ago |

Well, China will surely block this, just like how it blocked the Qualcomm attempt to buy NXP (https://www.reuters.com/article/us-nxp-semicondtrs-m-a-qualc...).

Otherwise ARM would become a US company, and then the US would have another weapon in their arsenal to sanction China's tech companies (e.g. Huawei).

m00dy 5 years ago |

Can anyone point me who would be competing with Nvidia in AI Market ?

joshvm 5 years ago | |

There's low power inference from Intel (Movidius) and Google (Coral Edge TPU). Nvidia doesn't really have anything below the Jetson Nano. I think there are a smattering of other low power cores out there (also dedicated chips in phones). TPUs are used on the high performance end and there are also companies like Graphcore who do insane things in silicon. Also niche HPC products like Intel Knight's Landing (Xeon Phi) which is designed for heterogeneous compute.

There isn't a huge amount of competition in the consumer/midrange sector. Nvidia has almost total market domination here. Really we just need a credible cross platform solution that could open up gpgpu on AMD. I'm surprised Apple isn't pushing this more, as they heavily use ML on-device and to actually train anything you need Nvidia hardware (eg try buying a Macbook for local deep learning training using only apple approved bits, it's hard!). Maybe they'll bring out their own training silicon at some point.

Also you need to make a distinction between training and inference hardware. Nvidia absolutely dominate model training, but inference is comparably simpler to implement and there is more competition there - often you don't even need dedicated hardware beyond a cpu.

option 5 years ago | |

Google, Habana (Intel), AMD in a year or two, Amazon in few years

andy_ppp 5 years ago |

Okay let’s look at this from a slightly different POV. We have two different things here, ARM CPU design licenses and ARM ISA licenses. If I was an ARM cpu maker I think it would be best to setup something to design better shared ARM CPU designs, the problem of course is building an amazing team and patents which could prove extremely expensive to solve.

Is it possible/legal for nvidia to charge a billion dollars per cpu for the isa license or are these things perpetual?

naruvimama 5 years ago |

(Nvidia - ARM) - Nvidia >> 40 Bn

Only about 50% is gaming and nascent divisions like data centres can get a big boost from the acquisition.

We only connected Nvidia with GPUs, perhaps AI & ML. Now they are going to be a dominant player everywhere from consumer devices, IOT, cloud, HPC & Gaming.

And since Nvidia does not FAB its own chips like intel, this transformation is going to be pretty quick.

If only they go into public cloud business, we as costumers would have one other strong vendor to choose from.

gumby 5 years ago |

Amidst all the hand-wringing: RISC-V is at least a decade away (at current pace + ARM’s own example). But what if Google bought AMD and put TPUs on the die?

thrwyoilarticle 5 years ago | |

AMD's x86 licence isn't transferrable. To acquire them is to destroy their value.

askvictor 5 years ago | |

Because so many of Google's acquisitions have ended up doing well...

sib 5 years ago | | |

Android, YouTube, Google Maps, DoubleClick, Applied Semantics (became AdSense), DeepMind, Urchin, ITA Software, etc.

I think Google has done ok.

yogrish 5 years ago |

SoftBank isa true banking company .. invested (Bought) in ARM and selling it now for meagre profit. A company that says it has 300 year vision

stunt 5 years ago | |

Maybe they are forced to choose behind the scene. Or, they know better opportunities and they need to cash out right now.

ComputerGuru 5 years ago |

Doesn’t this need regulatory approval from the USA and Japan? (Not that the USA would look a gift horse in the mouth, of course.)

sgift 5 years ago | |

There is a note at the end of the article:

"The proposed transaction is subject to customary closing conditions, including the receipt of regulatory approvals for the U.K., China, the European Union and the United States. Completion of the transaction is expected to take place in approximately 18 months."

Hopefully, the EU does its job, laughs at this and tells Nvidia to either go home or forces them to FRAND licensing of ARM IP.

kasabali 5 years ago | | |

> forces them to FRAND licensing of ARM IP

FRAND licensing is worthless, if Qualcomm taught us anything.

deafcalculus 5 years ago |

nVidia clearly wants to compete with Intel in data centers. But how does buying ARM help with that? They already have an architectural license.

Right now, I can see nVidia replacing Mali smartphone GPUs in low to mid-end Exynos SoCs and the like. But it's not like nVidia to want to be in that low-margin area.

fluffything 5 years ago | |

> I can see nVidia replacing Mali smartphone GPUs in low to mid-end Exynos SoCs and the like.

Replacing these with what? What nvidia gpus can operate at that power envelope ?

deafcalculus 5 years ago | | |

Lower power versions of what they put in Tegra / Switch? Or perhaps they can whip up something in 1-2 years. I'd be astonished if nVidia doesn't take any interest in smartphone GPUs after this acquisition.

andy_ppp 5 years ago |

This sort of stuff really isn’t going to produce long term benefits for humanity is it.

Does anyone know if or how Apple will be affected by this? What are the licensing agreements on the ISA?

gumby 5 years ago | |

ARM and Apple go way back (Apple was one of the three original consortium members who founded ARM). I am sure they pay a flat fee and have freedom to do whatever they like (probably other than sub licensing).

Owning ARM would make no sense for them as they would gain no IP but would have to deal with antitrust which would force them to continue licensing the ip to others, which is not a business they are in.

If ARM vanished tomorrow I doubt it would affect apple’s business at all.

UncleOxidant 5 years ago | |

This has been out there in the news for well over a month, I guess I don't understand why Apple didn't try to make a bid for ARM? Or why Apple didn't try to set up some sort of independent holding company or consortium to buy ARM. They definitely have the money and clout to have done something like that.

andy_ppp 5 years ago | | |

I guess Apple have a perpetual ARM ISA license. They haven’t used the CPU designs from ARM for many years.

dharma1 5 years ago | |

I doubt Apple's arm license will be affected. But I think they will be getting tougher competition in the sense that Android phones will be getting a fair bit better now - most of them will be using super well integrated Nvidia GPU/ML chips in the future because of this deal.

I think it will also bring Google and Nvidia closer together

curiousmindz 5 years ago |

Why do you think Nvidia cares about Arm? Probably the "access" into a lot of industries?

banjo_milkman 5 years ago | |

I think this is driven by partly embedded applications and more directly by the datacenter.

Nvidia already own the parallel compute/ML part of the datacenter and the Mellanox acquisition had brought the ability to compete in the networking part of the datacenter - but they were missing CPU IP, for tasks that aren't well matched to the GPU. This plugs that hole. They are in control of a complete data-center solution now.

paulmd 5 years ago | | |

There's a huge number of synergies that this deal provides.

(a) NVIDIA becomes a full-fledged full-stack house, they have both CPU and GPU now. They can now compete with AMD and Intel on equal terms. That has huge implications in the datacenter.

(b) GeForce becomes the reference implementation of the GPU, ARM processors now directly fund NVIDIA's desktop/datacenter R&D in the same way consoles and Samsung SOCs fund Radeon's R&D. CUDA can be used anywhere on any platform easily.

(c) Acqui-hire for CPU development talent. NVIDIA's efforts in this area have not been very good to date. Now they have an entire team that is experienced in developing ARM and can aim the direction of development where they want.

Basically there's a reason that NVIDIA was willing to pay more than anyone else for this property. And (Softbank's) Son desperately needed a big financial win to show his investors that he's not a fucking idiot for paying $32b for ARM and to make up for his other recent losses.

andy_ppp 5 years ago | |

No to make a better ARM chip, with awesome graphics/AI, not licence the design and take all the mobile CPU profits for 5-10 years?

choiway 5 years ago |

I'm confused. What is it that Nvidia can do by owning ARM that it can't do by just licensing the architecture? Can't they just license and build all the chips people think they'll build without buying the whole thing?

browserface 5 years ago |

Vertical integration. It's the end products, not the producers that matter.

Or maybe, more accurately, the middle of the supply chain doesn't matter. The most value is at either end: raw materials and energy, and end products.

Or so it seems :p ;) xx

gautamcgoel 5 years ago |

This is awful. Out of all the big tech companies, Nvidia is probably least friendly to open source and cross-platform comparability. It seems to me that their goal is to monopolize AI hardware over the next 20 years, the same way Intel effectively monopolized cloud hardware over the last 20. Expect to see less choice in the chip market and more and more propietary software frameworks like CUDA. A sad day for CS and for AI.

hn3333 5 years ago |

Softbank buys low ($32B in 2016) and sells high ($40B in 2020). Nice trade!

aneutron 5 years ago | |

How does it fare, adjusting for inflation and other similar factors ?

tuananh 5 years ago | |

i thought that would be low in investment world.

unnouinceput 5 years ago | | |

4 years, 8 billions. 2 B / year. I don't think that's low. And during this time Arm was also filling its owner coffers. The only real question here is if they filled the coffers at a greater 2B/year or not. My guess is they didn't. Now SoftBank has a lot of cash to acquire more shining toys.

unixhero 5 years ago |

It's so amazing Apple didn't win this M&A race.

rahoulb 5 years ago | |

Apple isn't interested in selling tech licences to other companies - they want to own their core technologies so they can sell products to consumers. And, as an original member of the Arm consortium, they have a perpetual licence to the Arm IP (I have no inside knowledge about that, just many people who know more than me have said it)

intricatedetail 5 years ago |

Isn't pay for IP model used by companies to avoid paying tax? I wonder if Nvidia is going to be forced to absorbe Arm in its entirety to avoid tax issues?

wpdev_63 5 years ago |

What do 5 hurricanes, global pandemic, and Nvidia buying Arm have in common?

What a wild year! Let's not forget Apple announce they are transitioning from x86 to Arm :b.

127 5 years ago |

What does this change for STM32 and many other such low power MCUs? They're pretty ubiquitous in electornics.

ryanmarsh 5 years ago |

Simple question, is this about ARM architecture and IP... or securing a worldwide competitive advantage in 5G?

vletal 5 years ago |

Nvidia being like "Apple did now want to use our tech? Let's just buy ARM!"

jl2718 5 years ago |

This is all about NVLink in ARM.

atg_abhishek 5 years ago |

Has this become the post with the most points and engagement by number of comments?

kkielhofner 5 years ago |

Looking at the conversations almost 24 hours after posting the IP, licensing, ecosystem, political, and overall business aspects of this have been discussed to death. Oddly for Hacker News there has been little discussion of the potential technical aspects of this acquisition.

Pure speculation (of course)...

To me (from a tech standpoint) this acquisition centers around three things we already know about Nvidia:

- Nvidia is pushing to own anything and everything GPGPU/TPU related, from cloud/datacenter to edge. Nvidia has been an ARM licensee for years with their Jetson line of hardware for edge GPGPU applications:

https://developer.nvidia.com/buy-jetson

Looking at the architecture of these devices (broadly speaking) Nvidia is combining an ARM CPU with their current gen GPU hardware (complete with Tensor Cores, etc). What's often left out of this mention is that they utilize a shared memory architecture where the ARM CPU and CUDA cores share memory. Not only does this cut down on hardware costs and power usage, it increases performance.

- Nvidia has acquired Mellanox for high performance network I/O across various technologies (Ethernet and Infiniband). Nvidia is also actively working to be able to remove the host CPU from as many GPGPU tasks as possible (network I/O and data storage):

https://developer.nvidia.com/gpudirect

- Nvidia already has publicly available software in place to effectively make their CUDA compute available over the network using various APIs:

https://github.com/triton-inference-server/server

Going on just the name Triton is currently only available for inference but it provides the ability to not only directly serve GPGPU resources via network API at scale but ALSO accelerate various models with TensorRT optimization:

https://docs.nvidia.com/deeplearning/triton-inference-server...

Given these points I think this is an obvious move for Nvidia. TDP and performance is increasingly important across all of their target markets. They already have something in place for edge inference tasks powered by ARM with Jetson but looking at ARM core CPU benchmarks it's sub-optimal. Why continue to pay ARM licensing fees when you can buy the company, collect licensing fees, get talent, and (presumably) drastically improve performance and TDP for your edge GPGPU hardware?

In the cloud/datacenter, why continue to give up watts in terms of TDP and performance to sub-optimal Intel/AMP/x86_64 CPUs and their required baggage (motherboard bridges, buses, system RAM, etc) when all you really want to do is shuffle data between your GPUs, network, and storage as quickly and efficiently as possible?

Of course many applications will still require a somewhat general purpose CPU for various tasks, customer code, etc. AWS already has their own optimized ARM cores in place. aarch64 is more and more becoming a first class citizen across the entire open source ecosystem.

As platform and software as a service continues to eat the world cloud providers likely have already started migrating the underlying hardware powering these various services to ARM cores for improved performance and TDP (same product, more margin).

Various ARM cores are already showing to be quite capable for most CPU tasks but given the other architectural components in place here even the lowliest of modern ARM cores is likely to be asleep most of the time for the applications Nvidia currently cares about. Giving up licensing, die space, power, tighter integration, etc to x86_64 just seems to be foolish at this point.

Meanwhile (of course) if you still need x86_64 (or any other arch) for whatever reason you can hit a network API powered by hardware using Nvidia/Mellanox I/O, GPU, and ARM. Potentially (eventually) completely transparently using standard CUDA libraries and existing frameworks (see work like Apex):

https://github.com/NVIDIA/apex

I, for one, am excited to see what comes from this.

cowsandmilk 5 years ago |

What is Amazon's license for ARM like to make graviton processors?

gigatexal 5 years ago |

How large or little of boost does this give the likes of RISC-V?

mlindner 5 years ago |

This is really bad news. I hope the deal somehow falls through.

hankchinaski 5 years ago |

this should have triggered an anti-trust probe into the deal, as this radically changes powers at play into the the chip market how many have outlined.

CivBase 5 years ago |

I was hoping that Apple's switch to ARM would prompt better ARM support for popular Linux distros. Given NVIDIA's track record with the OSS community, I'm definitely less hopeful now.

jbotz 5 years ago |

There is now but one choice... RISC-V, full throttle.

w_t_payne 5 years ago |

Sounds like we need someone to found another ARM.

bfrog 5 years ago |

So when does everyone switch to risc-v then

rvz 5 years ago |

What a death sentence for ARM right there and the start of a starvation in a new microprocessor winter. I guess we now have to wait for RISC-V to catch up.

Aside from that, ARM was one of the only actual tech companies the UK could talk about on the so-called "world stage", that has survived more than 2 decades. But instead, they continue to sell themselves and their businesses to the US instead of vice versa.

In 2011, I thought that they would learn the lessons and warnings highlighted from Eric Schmidt about the UK creating long standing tech companies like FAANMG. [0] I had high hopes for them to learn from this, but after 2016 with Softbank and now this, it is just typical.

ARM will certainly be more expensive after this and will certainly be even more closed-source, since their Mali GPUs drivers were already as closed as Nvidia's GPUs. This is a terrible outcome I have seen but from Nvidia's perspective, it makes sense. From a FOSS perspective, ARM is dead, long live RISC-V.

[0] https://www.theguardian.com/technology/2011/aug/26/eric-schm...

throwaway5792 5 years ago | |

Once they were sold to SoftBank ARM had no more control over its destiny. You're saying that they're repeating the pattern, but they had no choice in this today. This was SoftBank's decision as the owner of ARM.

Aeolun 5 years ago | | |

Softbank has some losses of it’s own to make up, so that’s not very surprising.

paulmd 5 years ago | |

love the armchair CEO perspectives that NVIDIA spent $40b only to flush the whole ARM ecosystem right down the drain, that's definitely a rational thing to do, right?

Jensen's not an idiot, how many OG 90s tech CEOs are still at the helm of the company they founded? Any severely negative moves towards their customers just drives them into RISC-V and they know that.

Yes, ARM customers will be paying more for their ARM IP. No, NVIDIA is not going to burn ARM to the ground.

therealmarv 5 years ago | |

Have you read the press release at all? It's too early to judge this now. ARM will stay in Cambridge and Nvidia wants to invest in this place.

klodolph 5 years ago | | |

It's not too early to judge, because this has been in the news for a while and people have had the time to do an analysis of what it means for Nvidia to buy ARM. The press release doesn't add much to that analysis. We've seen a ton of press releases go by for acquisitions and they're always full of sunshine... at the moment, I'm thinking of Oracle's acquisition of Sun, but that's just one example. The typical pattern for acquisitions is that a tech company will acquire another tech company because they can extract more value from the acquired company's IP compared to the value the acquired company would have by itself, and you can extract a lot of value from an IP while you slash development budgets. Not saying that's going to happen, but it's a common pattern in acquisitions.

I think it's enough to know what Nvidia is, how they operate, and what their general strategies are.

Not saying I agree with the analysis... but I am not that optimistic.

dylan604 5 years ago | | |

And when Facebook bought Oculus, they said no FB login would be required to use Oculus. FoxConn was supposed to ramp up production in the US according to a press release. That was then, now time has passed. bigCorp hopes your short term memory forgets the woohooism from a foregone press release.

BLKNSLVR 5 years ago | | |

I'm reminded of this recent development:

https://www.oculus.com/blog/a-single-way-to-log-into-oculus-...

Discussed here on HN, with the top comment being a copy and paste of Palmer Lucky's acknowledgement that the early critics turned out to be correct:

https://news.ycombinator.com/item?id=24201306

Different situation, different companies, but if you "follow the money" you'll never be too far wrong.

boardwaalk 5 years ago | | |

Corporations say these types of things with every acquisition. It might be true initially and superficially, but that's all.

causality0 5 years ago | | |

Why would you read the press release at all? Do you expect a company to not do what's in their own financial self-interest? Look, I love nVidia. I only buy nVidia GPUs and I adore their devices like the SHIELD TV, handheld, tablet, even the Tegra Note 7. Even I can see that they're not just buying ARM on a whim. They intend to make that money back. Them using ARM to make that money is good for absolutely nobody except nVidia themselves.

jacques_chester 5 years ago | | |

My experience of acquisitions is that sweet songs are sung to calm the horses. Then the next financial quarter comes around and the truck from the glue factory arrives.

If you take at face value anything from a press release, earnings call or investor relations website, then I would like to take a moment to share with you the prospectus of Brooklyn Bridge LLC.

poxwole 5 years ago |

It was good while it lasted. RIP ARM

oldschoolrobot 5 years ago |

This is horrible for Arm

geogra4 5 years ago |

smic and Huawei better be prepared to have to dump arm asap

01100011 5 years ago |

Can we,for once, hear the opinions of people in the chip industry and not the same tired posts from software folks? NVIDIA Bad! Ok, we get it. Do you have anything more insightful than that?

I'm starting to feel like social media based on upvotes is a utter waste of time. Echo chambers and groupthink. People commenting on things they barely know anything about and getting validation from others who don't know anything. I'd rather pay for insightful commentary and discussion. I feel like reddit going downhill has pushed a new group of users to HN and it's sending it down the tube. Maybe it's time for me to stop participating and get back to work.

QuixoticQuibit 5 years ago |

HN being hyperbolic and anti-NVIDIA as usual. I think this is a great thing. Finally a competitor to the AMD-Intel x86 duopoly. I imagine the focus will first be on improving ARM’s data center offerings but eventually I’m hoping to see consumer-facing parts available sometime as well.

japgolly 5 years ago | |

I think the biggest concern is NVIDIA's stance against OSS.

QuixoticQuibit 5 years ago | | |

Look at their AI/CUDA documentation and associated githubs. Many of their tools and libraries are open source.

Tell me, what other AI platform works with x86 and PowerPC and ARM? Currently NVIDIA’s GPUs do.

RubberShoes 5 years ago |

This is not good

paulmd 5 years ago | |

It wouldn't have been good if any of the people who could actually afford to buy ARM did so.

Would you rather have TSMC in control of ARM? Maybe have access to new architectures bundled with a mandate that you have to build them on TSMC's processes?

How about Samsung? All of the fab ownership concerns of TSMC plus they also make basically any tech product you care to name, so all the integration concerns of NVIDIA.

https://asia.nikkei.com/Business/Technology/Key-Apple-suppli...

Microsoft? Oracle? None of the companies who could have afforded to pay what Son wanted for Softbank were any better than NVIDIA.

There are a lot of good things that will come out of this as well. NVIDIA is a vibrant company compared to a lot of the others.

leptons 5 years ago | | |

Microsoft can't afford to buy ARM? lol... well that's not true at all.

bitxbit 5 years ago |

They need to block this deal. A real clean case.

iso8859-1 5 years ago | |

Who needs to block it? And why is it a clean case?

sizzle 5 years ago |

Holy shit this is huge. Did anyone see this coming?!?

sshlocalhost 5 years ago |

I am really worried of a single company monopolising over the entire market

patfla 5 years ago |

How does this get past the FTC? Oh right, it's been a dead letter since the Reagan administration. Monopoly 'R Us.

Never mind the FTC - the rest of the semiconductor industry has to be [very] strongly opposed.

hitpointdrew 5 years ago |

LOL, Apple must be shitting bricks. Serves them right for going with ARM for their new Mac Books, the smarter move would have been to move to an AMD Ryzen APU, they also clearly should have gone with AMD Epyc for the new Mac Pro's.

yissp 5 years ago |

I still think the real reason was just to spite Apple :)

RL_Quine 5 years ago | |

The company who was part of the creation of ARM and has a perpetual license to its IP? Tell me how.

hu3 5 years ago | | |

Even perpetual license to future IP?

ericmay 5 years ago | |

How does this spite Apple?

hetspookjee 5 years ago |

I wonder what the this means for Apple and their move to ARM for their macbooks. End of 2019 Apple and NVIDIA broke up their cooperation on CUDA. Both these companies are very tight on their hardware. Apple must've known this was happening but I guess they weren't willing to pay more than 40B for this risky joint venture they're bound to go into.

Anyone has a proper analysis on the ramifications of this acquisition for Apple's future in ARM?

renewiltord 5 years ago | |

Apple is an ARM founder. You can bet your boots they made sure they were safe through the history of ARM's existence and sale to Softbank in the first place. No one can cite the deep magic to them, they were there when it was written.

shmerl 5 years ago |

That's nasty Nvidia, very nasty. But on the other hand might be it will be a motivation for everyone to use ARM less.

I quite expect AMD for example to drop ARM chips from their hardware. Others should also follow suit. Nvidia is an awful steward for ARM.