Nvidia in final stages of acquiring ARM from Softbank?

Nvidia in final stages of acquiring ARM from Softbank?

Reports claim that video card manufacturer Nvidia is on the final stages of its negotiations with Softbank to acquire ARM.

ARM is well-known for its processor design as well as computer instruction set popular in smartphones. With the explosion of the smartphone industry, the company has also increased in value. This is probably one of the reasons why Nvidia is entering a bid to acquire the company.

Softbank currently owns ARM following a massive acquisition in 2016 that costs US$32 billion. Since then, the value of the semiconductor company continued to increase annually.

A potential acquisition offer

Considering how much Softbank spent to acquire ARM, the acquisition will not be cheap for Nvidia. Some market analysts claim that Softbank is asking for a $55 billion acquisition deal.

Considering the market where Nvidia operates, it seems a little bit odd that it is pursuing ARM. The two companies are operating in two completely different markets. The graphics card manufacturer focuses mainly on desktop computers and hardware, while ARM is on the mobile industry.

Since its acquisition four years ago, Softbank is reportedly in talks with several major tech companies. Chief among which is Apple, which is also a major player in the smartphone industry. It makes a lot of sense for Apple to acquire ARM, considering that they have common interests.

Some analysts are somewhat skeptical of why Nvidia wants to acquire ARM. Some analysts have even noted that if the acquisition pushes through, it will be disastrous for the tech industry. However, there is one particular new sector of technology that ARM has great potential: artificial intelligence.

The tech industry is now entering the age of artificial intelligence. There are now smart homes, embedded and connected devices, and, most importantly, autonomous driving cars. All these devices require massive computing power, and this is where ARM steps in.

A race for AI

Many tech analysts believe that the future of tech is AI. While ARM is a notable player in this field, there are far more established brands with vast experience. Two of the world’s largest processor manufacturer, AMD, and Intel, are also vying for market dominance.

Some might argue that ARM has the advantage when it comes to embedded and power-efficient processors. However, both AMD and Intel are already starting to develop such processors as well. AMD and Intel are just some of ARM’s biggest customers.

Nvidia is also competing with AMD and Intel in different markets. Considering this, the company might find it extremely difficult to navigate industry regulations.

Featured image courtesy of Project Kei/Wikimedia Commons

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