Also, I don’t believe the FTC mission is to increase US tax revenue, so that aspect seems irrelevant.
If the standard is "they don't compete against each other now, but would be disincentivized to compete against each other in the future," that could be used as a rationale to block literally every merger.
Don't you threaten me with a good time. Imagine, companies actually forced to collaborate via the ordinary mechanism of contract arrangements rather than by assimilation into a horrifying megaconglomerate.
The problem is when some companies form a cartel of sort (with our without contracts) anyway. The same way Intel was not licensing x86, but since AMD already had it they were both incentivized to keep users on x86 and keep arm out.
(Of course the nvidia-arm acquisition is more about nvidia trying to build an army, oh pardon, portfolio. As Intel and AMD already have. They acquired Mellanox, plus they have GPUs and CUDA chips. Intel and Apple kind of have everything of course. AMD has Radeon, but AMD is probably still trying to catch up financially. There's also Qualcomm with their snapdragons and modems. And there are probably others, but the important thing is that snapdragons are arm based. And while selling high-end ML and gamer/miner cards is certainly not bad, but nvidia is probably trying to expand into a different market too, let's say high-volume but older semi tech.)
Even though that would hurt me businesswise I would happily sign for that future. And while we're at it: make it illegal for one company to hold shares in another. Just natural persons holding shares in companies would be fine.
It would make it impossible for governments to own minority stakes in local subsidiaries of global corporations to veto some things. It would make it impossible to impose capital requirements on subsidiaries of big financial institutions. It would be impossible for larger competitors to rescue failing peers and keep them operating as a going concern.
And it would very likely create the most suffocating oligopolies on a national level as well as on an industry level as competitors would find it extremely hard to enter markets with entrenched incumbents if the only way to do it was to build from scratch.
So? That would enable local companies that occupy the same niche to do so. All these multinationals are not necessarily a good thing.
> It would make it impossible for governments to own minority stakes in local subsidiaries of global corporations to veto some things.
Only if you believe that those local subsidiaries should exist in the first place and that need not be the case.
> It would make it impossible to impose capital requirements on subsidiaries of big financial institutions.
There would be no such subsidiaries.
> It would be impossible for larger competitors to rescue failing peers and keep them operating as a going concern.
These could be structured as asset sales. And a whole lot of trickery that causes these peers to fail would go out the window.
You are making the mistake of looking at the glass 'half empty', when in fact the better way to look at it is what we would get for it in return. Capitalism, but with a much more direct link between UBO and the companies they have a hand in, far less opportunity for nation state level wealth to end up concentrated with a very small number of people and less opportunity for companies to play shell games with their income.
Capitalism, like money is a great invention. But like everything else when taken to extremes it is a net negative, in moderation it could well be uniformly good. But the whole externalization game needs to stop or it will harm us greatly.
All failing companies should be liquidated and sold off in bits and pieces, employees fired, contracts and debts voided, pension schemes closed.
Entrenched local incumbents could only ever be disrupted by individuals starting new companies, funded exclusively by other individuals. Presumably, none of these individuals would be allowed to own a controlling stake in another company, otherwise it would effectively be one company.
You would have to convince those wealthy individuals to start companies in small countries in spite of the fact that the growth potential of their company would be far more limited than if they started a company in a big country. The only incentive would be local protectionism.
You would also have to make sure that companies don't enter into contractual relationships that effectively make them act as one (such as McDonald's franchises)
You would effectively hand absolute power to local family clans and oligarchs closely intertwined with local bureaucrats and politicians. It's a recipe for stagnation and corruption.
This is not a glass half full and it's not moderation. It's a glass smashed in an act of vandalism and blind rage. It's the sort of revolution that countries take a century to recover from.
Turning the clocks back a couple of centuries is not progressive either.
No, that's not what I'm saying, besides that could be easily covered through employment law, but we already have the concept of internationally operating free-lancers.
> or do anything else across borders that requires a legal entity that can be locally regulated, taxed and held accountable.
Not if that legal entity is going to have a company as its shareholders. But there would be no reason why it could not exist and have natural persons as its shareholders, they could even be the same shareholders as in some other company abroad.
You are still arguing about this from the perspective of everything that it can't do, which is pretty easy to deal with because most of those things it can do. What it can't do is to hide the UBOs, which is really the only big change. Everything else can easily be worked around.
No, I also told you what I think it would do. Create a corrupt local oligarchy that is extremely hard to disrupt. It would create a mediocre, low productivity, stagnant economy shaped by the most extreme form of protectionism I have ever heard of.
>Everything else can easily be worked around.
Your use of the word "easy" for something that would require a root and branch redesign of company law, tax law, employment law, competition law and scores of other laws in every country on earth tells me that you really haven't thought this through. Not to speak of changing the ownership structure of tens of thousands of existing companies.
I don't know many individual directly handling shares with the exchange and the settlement. How do you avoid the enormous volume of trading that happen due to retirement account reuse for shorting ? Would you forbid that too, removing the incentive for company to be honest because nobody can short anymore ?
You know why? Because working with Nvidia has become such a pain in the ass. That it's better just to do it yourself.
They charge you 10x for a gpu that's a little better than their consumer GPU but won't sell you the consumer GPU because they want you to pay 10x.
Now they will definitely do the same with ARM licensing.
A while back they made a change to the terms of the GeForce driver, barring it from deployment in datacenters except for blockchain processing.
https://www.datacenterdynamics.com/en/news/nvidia-updates-ge...
That's an honest question, I can't fully recall.
They need their datacenter GPU numbers to look good at the end of the Q, they can't do that when all they are selling are 3090 that are perfectly fine to train the majority of AI models.
Try it this way: How many other companies are likely to compete with them in the future? If the answer is a thousand, the loss of potential competition is not very significant. If the answer is less than ten, it is.
https://en.wikipedia.org/wiki/List_of_largest_mergers_and_ac...
CVS buying Aetna was a particularly sick joke.
NVIDIA, on the other hand, is suspicious. It is in their interest to use and manipulate ARM to release/restrict products in such a way that will strengthen their already strong market position with accelerators, and push down its competitors like AMD and Intel.
I'd rather Nvidia be kept away from Arm at all costs.
They don’t need to collude, they’ll “compete” by siting on their ass like Intel did, barely being better yet jacking up the price, only “Haswell” is renamed “Zen 3”.
> monopoly
Pick one?
As much as it's easy to forget, the free market is supposed to be a tool for the benefit of consumers (through both price and innovation), and while it's not very common, every once in a while the government actually looks at that as important and steps in.
The reason for competition law is to regulate the free market to ensure that consumer choice is not limited by the uncontrolled acquisition and merger of suppliers.
The merger of NVidia and ARM is inherently non-competitive unless NVidia accepted limitations/restrictions on their licensing freedom which they are not willing to propose or accept.
That's leaving aside the international and other ramifications of a company that is involved in the entire vertical of chip production and sale through to retail having control of the licensing of the most used ISA and other IPRs that are available to its competitors throughout that vertical.
This isn't a question of "will the economy collapse if X buys Y" it's a question of "Which will yeild the best outcome, Y being acquired by X or no". The exact definition of "best outcome" is where the entire battleground though.
It is quite difficult to see who actually could acquire ARM though - because of ARM's quite unique position, any of the potential acquirers are either customers (Apple, Nvidia, Qualcomm) who would be vertically integrated to beat out competitors or direct competitors (AMD, Intel). I think almost the only people who could buy ARM at this point would be TSMC.
Softbank can still sell ARM to anyone including the public market, they just won't get as much money for them that way. Presumably.
I guess the other option is to list it on some stock exchange.
It's worth noting ARM Ltd is a British company currently owned by a Japanese company. The U.K. and Japan are two of the closest, if not the closest, defense and industrial partners the U.S. enjoys. And unlike many U.S. allies, they're more-or-less close by choice. IOW, there's a deep reservoir of trust across the spectrum--military, legal, political. Both the U.K. and Japan tend to exercise their independence far more freely than other U.S. allies precisely because of the mutual respect afforded among the three. There's much less tension and apprehension among those three than as between, say, the U.S. and France. A critical supplier like ARM being in the hands of the U.K. and/or Japan is good enough from the perspective of the U.S., absent some extraordinary complicating context.
"When Britain Nuked America....Twice!" https://www.youtube.com/watch?v=-Wx6npt421c
And this?
"U.S. satellites are being attacked every day according to Space Force general (thedrive.com)" https://news.ycombinator.com/item?id=29402923
I think its a good decision because just being dominated by US tech companies can be demoralising, besides no one has a monopoly on ideas or innovation which all develops at different rates.
And if ARM did get bought up, would this also drive other countries towards China who are developing their own CPU's? "How China plans to lead the computer chip industry" https://www.bbc.co.uk/news/business-50287485
From a US Military perspective, you don't want to pee off your military assets/partners do you?
The U.S. government isn't a monolith. FTC is charged with, first and foremost, maintaining our markets.
Allowing nVidia to become a monopoly would bite the US in the ass strategically, as nVidia loses incentive to innovate.
That's how the US, effectively, ended up having no viable aircraft when it entered WWI, after being the country that invented the thing. (Wright and Curtiss, IIRC, locked the market with patents).
Or, more closely, how the US telecom/Internet infrastructure is atrocious, despite — and because of — the Internet and the telephone being invented here. Go figure, Ma Bell wasn't the bees knees.
Strategically, the US needs someone to keep nVidia up on their toes. Innovation cuts into profit margins when you have a monopoly.
Nvidia is reasltically already a monopoly with CUDA. They don’t need to innovate and they force universities to use their more expensive GPUs.
They're constantly innovating, and have monthly software releases. Don't blame NVIDIA because AMD can't offer a solid enterprise offering that is attractive to customers.
But not the other baby bells, which is the point. Also, Apple went to Cingular after being rebuffed by Verizon. (Apple wanted no crapware. Verizon said no.) Competition working.
Because both of these are provably false.
As is that nVidia is already a monopoly.
Anti monopoly laws are useless, x86-64 is a duopoly, and any monopoly laws aren’t able to stop Amazon and their vertical intergration, because the argument is that eBay and other sites exist. Network oligarchs collaborate to fix prices.
The USPS is required to deliver to everyone, even when it doesn't make monetary sense to do so. They are an important piece of US infrastructure.
They are also incredibly constrained by legislation. They aren't allowed to just raise prices as needed.
> The agency is burdened by hundreds of billions of dollars in debt and falling revenue, and Congress and the White House have signaled an unwillingness to grant more funding without major restructuring, lawmakers say.
> The law envisioned the Postal Service as a self-sustaining agency whose revenue could cover the expenses associated with an aging workforce involved in a physical occupation: delivering packages and parcels to every address in the country.
> Not even two decades later, it can’t. The Postal Service has racked up $160.9 billion in debt from what’s owed prepaying retiree benefits. On top of that, it has many years’ worth of operating deficits, as its top revenue generators no longer covered the costs of delivering the mail.
Then why do they need bailouts? Are these bailouts self funding? What money gave them that credit when they were long unsustainable? This is an unnatural monopoly that doesn’t allow competitors and also is a failure who mostly delivers worthless physical spam you cannot escape.
Because unlike any other company or agency, they are required to prepay retiree benefits.
Anyway, you might be surprised to hear that our Army and Navy aren't self-sustaining. Obviously, we should cut their funding and see how they manage to make their nukes pay for themselves. /s
If you don't get the difference between 401K and what the USPS was required to provide, you are deliberately obtuse, and are arguing in bad faith.
>The USPS already uses private carriers for remote places.
It's the other way around. I guess that settles the "if" in the above.
Also we kinda want to keep territories like Alaska inhabited because geopolitics.
And we kinda want the people living in those places to be able to get their official government documents (driver licenses, court notices, etc).
Then there's this idea of voting by mail, which isn't something that should be a privilege, but that's too complex for our discussion.
To translate one of the reasons for USPS into words you may understand: you know how two-factor authentication requires that second factor? The USPS provides a means for the gov to get that second factor into the hands of the people.
A third party would be a man-in-the-middle.
So consiser USPS a part of the government's 2FA infrastructure and messaging system with SLA and proof of delivery.
That, unlike your company's authentication infrastructure, happens to pay for itself.
Natural monopolies are things like electric power grid and water supply and train and roads, they last forever precisely because they are natural and they were never leapfrogged in history. 'Natural" part stands for nessesary inveatment in infrastructure being redundant and causing zero-sum game.
Kodak wasn't much of a monopoly and certainly wasn't a natural one
Read up on how antitrust actually works, your assesment of USPS is equally inaccurate
My totally uninformed opinion is that basically the only IP law that's worth a damn is trademarks (which should absolutely be very strongly enforced. It's crucially important that consumers know who they're buying from for the market to work properly), and maybe copyright on /entertainment/ focused creative works for the life of the author and no longer.
All "developing" nations don't (and shouldn't) GAF about IPRs during that phase in their development. Notice that China didn't GAF for years, but does now, both from a control POV and from a competition POV.
Countries only worry about IPRs when they have sufficient IP development to have something to sell.
The also FTC contends that ARM induces competitive behavior in Nvidia. And a merger would stifle that competition.
Additionally, and probably most importantly, the FTC contends that Nvidia's competition shares sensitive information with ARM. And part of what Nvidia is looking for with this acquisition is this information. I suspect this is the true reason behind the lawsuit; there's probably a good bit of industry support behind it.
Personally, I'd rather ARM be owned by a massive American firm. And out of all the American firms who would be interested in ARM, Nvidia is the most likely to continue to innovate, rather than merely engage in rent seeking behavior.
Massive firms are not an inherent Good Thing. There are some benefits due to their ability to invest, but there are also multiple downsides to conglomerates, particularly in strategically vital industries and areas.
The alternative would be to go public again. But I think the temptation is too great, and some massive company would take it over. ARM is the kind of company which is much more valuable as a part of a conglomerate than it is as an independent company.
If it is the FTC's actual position that the deal would harm consumers or the industry as a whole, it's certainly admirable that they would ostensibly prioritize that over US strategic interests.
This makes me wonder if their analysis shows that the merger would do sufficient harm within the industry as to actually run counter to US interests. If ARM is shaping up to become a pillar of the Western world/economy while China and its sphere of influence consolidate around RISC-V, then anything that harms Arm's market position is also a geopolitical risk to the West. The US government pushing for such a merger, at a time when China is investing heavily in semiconductor manufacturing capabilities while eyeing a conquest of Taiwan/TSMC, would therefore be shooting itself in the foot. Better to grow the pie than risk blowing it up for a slightly larger slice.
This is some seriously flawed thinking extremely convenient for corporate interests. Mixing up marlets with national security leads to the kind of atrocities that make totalitarian states proud.
"Coca-Cola Co.'s Colombian bottlers are working with death squads to kill, threaten and intimidate plant workers,"
I like Nvidia (because I don't have to work with them), but I don't think they are the right steward for ARM in any way.
- Microsoft was mostly contractual on the Xbox, Nvidia didn't want to lower the price of the chips over the lifespan of the 1st Xbox which was a huge no-no. And some technical people also had a terrible experience (some people in the DirectX team had strong thoughts about working with Nvidia).
- Sony was mostly about terrible tech support and not wanting to share enough technical details which hampered AAA devs a whole lot, to the point most ended up using the SPUs in very creative (and technically fascinating) ways to compensate (the GTA V engine on PS3 was truly impressive in that regard).
- There were some minor (but acrimonious) back and forth with Apple over a failing gen of GPUs (G80s if memory serves), but the large fallout came for the same reason as for the rest of the mobile industry : the Kepler licensing initiative.
Long story short, Nvidia tried to assert patents on mobile GPU (ala Microsoft on Android, as a way to "sell" their exit of the mobile market to investors). They then sued Samsung and Qualcomm [1]. Samsung countersued Nvidia, which had to settle as Samsung was close to winning a ban on imports from some Nvidia products [2]. Many of the patents Nvidia tried to assert were thrown out and they had a terrible legal time.
The damage that ill thought strategy did to Nvidia is hard to measure but there's not a single mobile company that wanted that acquisition to go forward and many are probably quite relieved after this.
[1] : https://www.zdnet.com/article/nvidia-launches-patent-suit-ag... [2] : https://www.reuters.com/article/us-nvidia-samsung-elec-idUSK...
Not going to be a thing going forward, of course. The M1 (next seems to be M3 at 3nm ?) will handle the GPU from here on out
"Free trade" and "Free markets" has never meant "totally unregulated".
That's completely flawed reasoning that ignores the actual purpose of those things, which is to encourage increased/better supply of products and services to consumers at the best possible price.
That being said, nVidia is currently not playing in ARM's space, so it's hard to argue that this acquisition will harm US consumers or raise prices for them. Hence my feeling is that this is politically motivated, at least to some extent.
Also, we (the US) are entering a period of intense competition with China that may last decades and may even include acts of war. Semiconductors are a key area of competition. More US control of key semiconductor assets is in the US interest. However to be totally fair that doesn't typically concern anti-trust law. But it should concern the current administration and drive some of these decisions about where to focus. It would be very different if this was about social networks and funny cat gifs.
Huh? They currently use arm designs in the Nintendo switch and their own shield line. They also utilize them in their mellanox Ethernet adapters and network switches. What makes you believe that won't give them a reason to increase prices for competitors that also use ARM chips, if not outright refuse to grant them a license?
Look who ARM licenses to and what sort of products those clients manufacture. They are in direct competition right now in a number of areas.
Maximizing tax revenues is not the FTC’s job.
while you might win a little on one side of the ledger how much would you lose on the other?
As a frequently observed phenomenon, no. The intellectual property and brand which generate revenue for ARM will be held in some other country, so profits can be directed there and no tax payable in the USA.
Great way to cause a chip crises and kill our car industry, but if they keep going at this pace, soon there won't be anything left to sell.
https://www.extremetech.com/computing/326447-arm-china-seize...
The main concern voiced here is that Nvidia-Arm could get away will less research while earning more money.
That’s basically what happened when Wintel was at peak and there was no viable alternative to Intel chips. They didn’t bring incredible innovation from the ungodly amount of money they gained; they just crushed all their other competitors through various means, got sued, and still made the field plateau for a decade or so before we saw real innovation.
- Intel
- AMD
- Apple
- Qualcomm
Any of them is pushing the enveloppe in some way or form, I’d argue they are “cutting-edge”
Stopping two US companies from merging because it would create a monopoly and negatively impact US consumers is one thing. But this isn't even remotely the case here? Doesn't the US government get more tax revenue if Nvidia makes some extra dough charging royalties for that IP? I’m confused.