Arm Faces US Antitrust Probe Over Chip Licensing

The US Federal Trade Commission (FTC) has launched an antitrust investigation into Arm Holdings Plc concerning its semiconductor technology licensing. People familiar with the confidential probe revealed that the FTC is examining if Arm is attempting to illegally monopolize parts of the chip market. Specifically, the investigation aims to determine if Arm might restrict or degrade the quality of licenses for its central processing unit blueprints, particularly as it increases its own chip development efforts.

This investigation by the US regulator, which notified Arm earlier this year, is part of a broader global examination of Arm's business practices. European and South Korean authorities are also scrutinizing Arm, with Qualcomm having lodged a complaint with the European Commission alleging restrictions on license access. Arm has declined to comment on the investigations but stated that Qualcomm's accusations are an attempt to gain leverage in a commercial dispute.

Arm, historically a licensor of chip designs rather than a manufacturer, is undergoing a strategic shift. Under CEO Rene Haas, the company is expanding its role in the data center and AI chip markets, aiming to capture more value from complex chip development. This move, welcomed by customers like Alphabet and Amazon, positions Arm to benefit from the growing demand in these sectors, even as the smartphone chip market faces slower growth.