EU rejects Nvidia arms deal proposals, citing competition concerns
Nvidia’s continued efforts to buy Arm are meeting more resistance in Europe. On Wednesday, the European Commission said it was concerned that Nvidia could use the merger to prevent competitors from gaining access to Arm chip designs.
“Our analysis shows that the acquisition of Arm by Nvidia could result in restricted or degraded access to Arm’s intellectual property (intellectual property), with distorting effects in many markets where semiconductors are used”, said Margrethe Vestager, Executive Vice-President of the Commission.
According to the announcement, Nvidia has “submitted pledges” in an attempt to address the Commission’s concerns. In the past, one of the commitments was to maintain Arm’s open licensing model. However, the EU rejected these conditions, calling them “insufficient”.
The main concerns of the Commission are how Arm chip technologies are used to power data centers, smartphones and video game consoles. If Nvidia controlled Arm, the company could also influence and undermine companies in the industry, including competitors.
In response, the Commission is launching an in-depth investigation “to determine whether its initial competition concerns in these markets are confirmed”. The investigation will also analyze whether “Arm licensees might be reluctant to continue to share commercially sensitive information with the merged entity.”
“Our investigation aims to ensure that companies operating in Europe continue to have effective access to the technology necessary to produce cutting-edge semiconductor products at competitive prices,” added Vestager.
The Commission has given itself until March 15 to make a decision.
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However, Nvidia continues to claim that the proposed merger will be good for the industry. For example, the company plans to increase funding for Arm to help it develop more technology. “We look forward to the opportunity to address their initial concerns and continue to demonstrate that the transaction will help accelerate Arm and boost competition and innovation, including in the EU,” Nvidia said in a statement. Wednesday.
However, the UK Competition and Markets Authority is also concerned that the Nvidia-Arm merger could harm the industry and cause prices to rise. In August, he recommended that the UK launch a broader investigation into the deal citing anti-competitive concerns.
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