Nvidia is buying the chip designer arm, and that could be very good news for Nintendo.

© Nintendo

Arm, the British semiconductor design firm behind mobile technology found on millions of devices around the world through companies like Apple, Microsoft and Qualcomm, is being acquired by Nvidia from Japanese company SoftBank for a whopping $ 1,000. $ 40 billion.

Initially, at least, it appears that Nvidia is keen to keep things the way they are, and Arm will continue to be based in the UK; Nvidia has even pledged funding to create an artificial intelligence research center at Arm’s headquarters, hinting that the deal is more about the future of AI than leveraging Arm’s technology network. Nvidia has also stated that it intends to create massive Arm-based data centers for cloud computing and other uses.

In the long term, though, it’s not unreasonable to see the acquisition as Nvidia’s way of making its way into the CPU sector, an area in which it has traditionally struggled. The company’s main area is GPU creation, and outside of its Tegra “system on a chip” line, which is used in the Nintendo Switch, it is more concerned with artificial intelligence and car technology.

The first Tegra chips were intended for smartphones and MP3 players like the ill-fated Microsoft Zune, but Nvidia found it difficult to advance in a smartphone sector dominated by Qualcomm’s Arm-based Snapdragon chipsets, and instead focused on putting its silicon in tablets and handcrafted devices, like the Nvidia Shield line, the creation of which arguably helped get Nintendo’s attention when it came to the technology it wanted to use within the Switch.

Arm’s business model is based on licensing its intellectual property to other companies for manufacturing, rather than producing the chips themselves. That means that once the deal is finalized, Nvidia (through Arm) will receive royalties for every Arm chipset made in the world.

For Arm, it’s another indication of how successful the business, which was founded in 1990 from Acorn Computers’ Archimedes home computer, has been in recent years. Arm chips are used in almost every smartphone these days, and have previously been found on the Game Boy Advance, Nintendo DS, 3DS, and Switch (Nvidia’s Tegra “System on a chip” uses Arm silicon as its CPU ). Apple has recently decided to use Arm chips in its future MacBooks, and Microsoft is also creating a version of Windows and Surface OS that will run on Arm. That kind of explains why Nvidia has had to pay $ 10 billion more than the $ 30 billion SoftBank bought the company for in 2016, at a time when Nvidia was worth roughly the same. Today, Nvidia is worth $ 300 billion.

So how does this benefit Nintendo? Nvidia and Arm are now under the same roof (so to speak) will only make the position of the former in the market more secure; you will now have a greater degree of influence over the world’s most popular mobile CPU technology (although it has been said that Nvidia intends to keep Arm “neutral”, so you won’t get any unique advantage, at least to begin with) and That It could bode well when it comes to Nintendo’s position in the gaming hardware market over the next decade, assuming it decides to stick with Nvidia’s Tegra chips, of course.

Arm’s success will now directly benefit Nvidia, which will only strengthen the company’s position in the mobile chip market. Nvidia is already a world leader when it comes to GPU technology (an area Arm is also involved in, through its Mali chipsets), so having a closer involvement with CPU products Arm phones, the world’s leading, could lead to some particularly exciting developments in the portable computing arena – developments that could shape the future of the Switch brand.