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China state media speaks out against NVIDIA buying Arm, calls it 'disturbing'

A state-affiliated news outlet thinks an Arm/NVIDIA tie-up would be a major blow for Chinese companies.

Published onSeptember 17, 2020

Arm at TechCon
  • A Chinese state-owned publication has spoken out against the NVIDIA/Arm deal.
  • The outlet points to US actions against Chinese companies as a reason to oppose the acquisition.

NVIDIA made tech headlines over the weekend when it announced a $40 billion deal to acquire silicon and computing pioneer Arm. The deal would mean that NVIDIA directly or indirectly controls the technology inside the vast majority of smartphones as well as a growing number of computers.

Now, China’s state-affiliated Global Times (h/t: Reuters) has spoken out against the acquisition, labeling it “disturbing.” More specifically, the outlet points to US-Chinese relations and actions against Chinese tech firms as a reason to oppose the deal.

“Given the US-China tensions and US suppression on a range of Chinese technology enterprises, if Arm falls into US hands, Chinese technology companies would certainly be placed at a big disadvantage in the market,” the state-backed publication asserted.

“Not just HUAWEI, all Chinese technology companies being put on the US Entity List could be cut off from Arm-based chips, while European companies using Arm technology may also encounter difficulties in supplying products to the Chinese market, contributing to a major disruption to the supply chain,” it elaborated, adding that affected firms might have to look at alternatives to Arm.

The UK-based but Japanese-owned Arm reportedly halted some business dealings with HUAWEI in the wake of the US ban in May 2019, but resumed some ties with the Chinese brand shortly thereafter. Nevertheless, ownership by a US firm like NVIDIA would likely further complicate matters for the likes of HUAWEI and any other Chinese companies subject to US actions.

See also: The HUAWEI ban explained

Arm is also widely seen as a neutral player in the computing and mobile industry, offering its technology to customers like Apple, HUAWEI, MediaTek, Qualcomm, Samsung, and more. But the prospect of being owned by one of these players has called this neutrality into question. Nevertheless, the two companies insist that it’s business as usual and that the computing pioneer’s neutrality would be preserved.

The combination of concerns about Arm’s neutrality under NVIDIA and potential repercussions for Chinese companies means that the deal could face even closer scrutiny from regulators around the world.

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