Nvidia announced on Sunday evening that it would acquire computing giant Arm for $40 billion. During a press call held early on Monday morning, Nvidia CEO Jensen Huang and Arm CEO Simon Segars shed more light on what the deal means for existing markets, such as smartphones, and what the future holds for the two companies.
The most important revelation is that Arms core business strategy will remain independent. Nvidia is purchasing Arm partly for access to its huge range of licensing partners and these companies can continue to use Arm intellectual property as before. Nvidia plans to introduce its own graphics and AI IP into the chain, greatly broadening its reach into various computing markets around the world.
Heres what Nvidia buying Arm means for the mobile market and the tech industry at large.
Nvidia buys Arm: The ins and outs
Pending regulatory approval, Nvidia is purchasing Arm from SoftBank for a total sum of $40 billion. This will be paid in the form of $12 billion in cash and $21.5 billion in stock. Regulatory approval could take around 18 months. During that time Arm and Nvidia continue to operate as separate entries and will be sticking to their current public roadmaps. If the deal goes through, Arm will become a business unit of Nvidia.
Nvidia currently a customer of Arm notes that Arm will retain its operational independence. In the sense that it will continue to operate as a subsidiary company rather than being incorporated into Nvidia at large. In other words, the deal wont chop Arm up for intellectual property or staff. This is important, as Arms core IP licensing business will remain as is. Various partners currently licensing Arm technology, such as mobile giants Apple and Qualcomm, can continue to do so. However, we dont yet know if Nvidia will end up utilizing Arm technology for future proprietary designs.
Latest Arm processors:Arm Cortex-X1 and A78 | Arm Mali-G78 and G68
The big picture is that Nvidia bought Arm in part to access its licensing business model and Rolodex of existing customers. Huang wants to expand Arms IP licensing portfolio with Nvidias world-leading GPU and AI technology. This is part of Nvidias plan to bring its AI compute power to a much broader range of devices, from tiny internet-of-things processors to server farms. Oddly enough, Nvidia will continue to use RISC-V, a competing CPU architecture, for a number of small processors used in its GPU and other products.
Arm’s IP licensing business will remain as is, Nvidia wants its Rolodex of existing customers
The other elephant in the room is the implication of US-based Nvidia buying UK-based Arm. Particularly when it comes to deals with partners based in China. Arms Simon Segars notes the majority of Arms IP is held in the UK and much of the remainder is based outside of the US, so doesnt fall under US export rules. This wont change following the Nvidia purchase.
Nvidia also wants to assure its commitment Arms UK base by investing in a new AI data center in the city of Cambridge. The site will include an Arm-powered supercomputer and facilities to serve AI researchers, scientists, and startup companies. The overarching message is that it will be business as usual for Arm, but we wont know for certain until the ink is dry.
What this means for future smartphones
All current smartphone SoCs are built using Arm CPU and other technologies, so this deal has major implications for future mobile processors. Arms list of high-profile partners includes Apple, Qualcomm, Samsung, and more. As the IP situation will remain unchanged, these companies can continue to access existing and future component designs from Arm, as well as their architecture licenses. Its business as usual for mobile SoC designers. Although whether these companies are happy with profits funneling to their rival remains to be seen.
Whats perhaps more interesting is that Nvidia stands to gain a major foothold in the PC CPU space. With Apple making the switch to in-house Arm PC processors and the growth of Windows on Arm, Nvidia adds another string to its bow in the battle with Intel and AMD in PCs and servers. If were on the precipice of a major shift in the Arm vs x86 PC dynamic, the timing of Nvidias purchase is impeccable.
Arm vs x86:Instruction sets, architecture, and all key differences explained
Nvidia is best known for its graphics processors and so the question on mobile enthusiasts lips is whether future SoCs could feature GPUs designed by the green team. The Tegra chips powering the Nintendo Switch already showcase Nvidia graphics running at 7.5-15W TDP, and Nvidias Jetson Nano board brings its Maxwell architecture as low as 5W. The improved efficiency of newer Turing and Ampere architectures might run well within the 5W requirements of smartphones. So yes, smartphones powered by Nvidia graphics are definitely possible.
Don’t bet on seeing a smartphone with an Nvidia GPU any time soon.
That said, Huang confirmed that Arms existing Mali graphics solutions arent going anywhere. Mali serves a wide range of use cases, from TVs to smartwatches, and Nvidia wont be forcing existing Arm customers to switch to a new IP. However, it does plan to introduce new options for customers who want access to Nvidias rich ecosystem of accelerated computing, gaming, and other tools. Just dont bet on seeing a smartphone with an Nvidia GPU any time soon.
Its also worth noting that Qualcomm has its in-house Adreno GPU team and Samsung has a deal with AMD for future chipsets. So theres no obvious large-scale high-end partner for smartphone SoCs featuring Nvidia graphics right now. Well just have to wait and see what Nvidia brings to the table for sub-5W use cases in the coming years.
AI everywhere: A shared company vision
While Nvidia wants to convince pundits, partners, and regulators that it will mostly be business as usual for Arm, the company isnt just interested in banking some of the worlds most important intellectual property. Just like SoftBank, Nvidia is so interested in Arm because of its current position and further potential for powering the vastly interconnected world of the internet-of-things.
Arms low power RISC processor design and developer ecosystem have made it a key processor player from power-hungry data servers to tiny battery-powered edge devices. Nvidia wants to leverage Arms ecosystem to integrate its industry-leading AI processing capabilities into this range of product segments. Their combined IP, licensing experience, and investment potential positions Arm/Nvidia as a one-stop-shop for the AI technologies of tomorrow.
See also:Nvidia Jetson Xavier NX review: Redefining GPU accelerated machine learning
Of course, this is a longer-term outlook that will play out over the next decade. In the meantime, Nvidia will have to balance the expectations of Arms existing customers with its pursuit of cornering the future AI market. That may not be such an easy task if existing partners decide to reevaluate their options in light of this purchase. Its now over to the regulators to decide if this match is in the tech industrys broader interests.read more
What Nvidia buying Arm means for your next smartphone
