Out of Arm's Way

After a £24bn takeover of iPhone chip designer ArM, where now for Apple?

- Alex Blake

When the news broke in July that UK processor designer ARM had been taken over by Japanese firm SoftBank for the princely sum of £24bn (yes, billion), a lot of people were left feeling confused. For many, it was the first they had heard of ARM, and it left a lot of pertinent questions to be answered. Why was this unfamiliar British company being bought by an equally unfamiliar Japanese company, and why was it worth such an astronomical sum?

One reason is ARM’s reach (so to speak). It designs chips for the vast majority of the world’s smartphones, including every iPhone ever made. That kind of near-universal market penetration is undoubtedly valuable to any potential buyer. But does this takeover mean changes are coming to the iPhone and its A-series processors?

SoftBank is no stranger to huge takeover bids. In 2013 it paid $20.1bn for a controlling stake in US telecommunications firm Sprint. It also runs the Japanese operations of UK phone network Vodafone. It took over French robotics company Aldebaran and made it into a global name, and has similarly announced that it plans to expand ARM and double the number of staff working at its UK operations over the next five years (in fact, Masayoshi Son, CEO of SoftBank, pledged to make that a legally binding commitment that would be enforceable by the UK government’s business takeover panel).

The Internet of Things