Update: Recently SoftBank Group among other Silicon Valley notaries such as Apple and Facebook, have poured over $100 billion into a new Softbank “vision Fund” that Founder Masayoshi Son says is going to be used to help develop AI. This is allocated to spending on emerging technology companies in the next 5 years. To put that number in perspective, the entire global venture capital “industry” is only $65 billion in size. Here is his presentation about that from MWC 2017:
March 3, 2017: Globalfuturist.org: Softbank CEO, Masayoshi Son Keynote at MWC 2017 (25 and half min)
The How to Invest in the Singularity – It’s Near from June 3, 2017 will also give you a deep analysis of this initiative. Highly recommended!
End of Update
The quick answer is that “ARM is the driver of the IoT era” when every thing is interconnected. Another reason is that they have been steadily working in an early investment mode from very beginning, and quite successfully.
SoftBank CEO and Founder Masayoshi Son has been referring back to the PC and Internet era when his company invested into Yahoo US which had only 16 employees then. In the beginning of PC broadband they have invested into mobile internet. And now is one of the biggest paradigm shifts is coming BIG TIME, that is IoT — he says. Some of his quotes shed light on what kind of perspective he is thinking of:
I truly believe Singularity [*] is coming and that computers will one day become smarter than mankind.
Every street light will be interconnected to the internet because we can save when car is not passing.
Automobile will all be connected so driverless car much safer.
All the things will be connected and what is biggest common denominator, that is Arm.
* Technological singularity (Wikipedia): “is a hypothetical event in which an upgradable intelligent agent (such as a computer running software-based artificial general intelligence) enters a ‘runaway reaction’ of self-improvement cycles, with each new and more intelligent generation appearing more and more rapidly, causing an intelligence explosion and resulting in a powerful superintelligence that would, qualitatively, far surpass all human intelligence. This would signal the end of the human era, as the new superintelligence would continue to upgrade itself and would advance technologically at an incomprehensible rate.”
For more information see the rest of the Wikipedia article.
And about the automobile opportunity alone he said:
I would say automobile is becoming smarter and smarter so when automobile becomes so smart it is required to have more and more chips integrated inside the car, especially when it becomes a driverless car. Automotive itself will become a super computer which consists of a bunch of multiple chips so ARM will be going into that market very aggressively.
More information along these lines see in the SoftBank CEO: the average person will have 1,000 internet-connected devices by 2040 article by Tech in Asia.
July 18, 2016: ARM CEO Simon Segars about SoftBank acquisition
Official video released at https://www.acceleratingtech.com/ a site to explain the SoftBank acquisition of ARM, they claim:
– SoftBank’s £17 offer price gives ARM shareholders a 43% premium on Friday’s closing share price and a 41.1% premium on the all-time high share price
– Assurance to double ARM’s UK headcount in the next five years and increase headcount outside the UK
– Leaves ARM’s successful partnership business model, culture and brand unchanged
– Great endorsement of UK tech
July 18, 2016: Acquisition of ARM Holdings plc
Background and Rationale by SoftBank Group Corp.
(from Recommended Acquisition of ARM by SoftBank)
The acquisition of ARM by SBG will deliver the following benefits:
- Support and accelerate ARM’s position as the global leader in intellectual property licensing and R&D outsourcing for semiconductor companies
SBG’s deep industry expertise and global network of relationships will accelerate adoption of ARM’s intellectual property across existing and new markets.
- Maintain ARM’s dedication to innovation
SBG intends to sustain ARM’s long-term focus on generating more value per device, and driving licensing wins and future royalty streams in new growth categories, specifically “Enterprise and Embedded Intelligence.”
- Increased investment to drive the next wave of innovation
SBG intends to support ARM’s multiple growth initiatives by investing in engineering talent and complementary acquisitions with the aim of ensuring ARM maintains a R&D edge over existing and emerging competitors. SBG believes such an investment strategy in long-term growth will be easier to execute as a non-listed company.
- Shared culture and long-term vision
SBG believes the two companies share the same technology-oriented culture, long-term vision, focus on innovation and commitment to attracting, developing and retaining top talent. These common values will be the foundation for the strong strategic partnership necessary to capture the significant opportunities ahead.
- Maintain and grow the UK’s leadership in science and technology
SBG is investing in the UK as a world leader in science and technology development and innovation and, as evidence of this, intends to invest in multiple ARM growth initiatives, at least doubling the number of ARM employees in the UK over the next five years.
July 18, 2016: Our Business Model (from Presentation material (English) (PDF) )
July 2015, from CEO Message:
Transformation into “SoftBank 2.0”
Thirty-four years have now passed since the foundation of SoftBank, and so far, our position has been one of SoftBank holding assets in overseas companies as a company in Japan. Now, however, we are going to the second stage of SoftBank—“SoftBank 2.0”—in which we will transform SoftBank into a truly global company that can ensure sustained business growth over the long term. We are now in a major transition period.
As the founder, I have set out to create a business model that can deliver continued business growth for centuries. However, many technology companies face the common challenge of a 30-year life cycle where growth is followed by decline. This decline stems from factors such as the increasing obsolescence of technologies and business models, and an over-reliance on founders.
What is the solution? Not only do we need to transform our existing businesses, we also need to have a comprehensive structure in place for supporting disruptive entrepreneurs and facilitating continued development with them.
… [the rest is to see at the place of original]
July 18, 2016: Press Conference: ARM to be acquired by SoftBank
Japanese SoftBank CEO and Founder Masayoshi Son (https://www.youtube.com/results?search_query=Masayoshi+Son), the richest person in Japan, speaks at the SoftBank Press Conference to announce the acquisition of ARM Holdings for $31.4 Billion, SoftBank promises to keep the same business model for ARM, to increase the employee count in the UK by 2x within the next 5 years, to increase ARM’s employee count around the world. You can read the official presentation materials here:
[i.e. Presentation material (English) (PDF)]
July 2015, Major Subsidiaries
|Company Name||Voting Rights (%)||Principal Business Activities|
Mobile Communications Segment
|SoftBank Mobile Corp.*1||100||Mobile communications services, sale of mobile devices|
|BB Mobile Corp.||100||Holding company|
|Ymobile Corporation*1*2||99,7||Mobile broadband services, development and sale of communications devices, ADSL services, PHS-based mobile communications services|
|GungHo Online Entertainment, Inc.*3||40.2
|Production and distribution of online games for smartphones and other devices|
|Wireless City Planning Inc.||33,3||Planning and provision of mobile broadband services|
|SoftBank Commerce & Service Corp.*5||100||Manufacture, distribution, and sale of IT-related products, IT-related services|
|Brightstar Global Group Inc.||100||Holding company|
|Brightstar Corp.||100||Mobile device distribution, supply chain solutions, handset protection and insurance, buy-back and trade-in, omnichannel solutions and financial services|
|GRAVITY Co., Ltd.*6||59,3||Planning, development, and operations of online games|
|Supercell Oy*7||53,7||Production and distribution of mobile game applications|
|Sprint Corporation||79,5||Holding company|
|Sprint Communications, Inc.||100||Mobile communications services, sale of mobile devices and accessories, fixed-line telecommunications services|
Fixed-line Telecommunications Segment
|SoftBank BB Corp.*1||100||ADSL services, IP telephony services|
|SoftBank Telecom Corp.*1||100||Fixed-line telephone services, data transmission and leased-line services|
|Yahoo Japan Corporation||43,0||Operation of the Yahoo ! JAPAN portal, sale of Internet advertising, operation of e-commerce sites, membership services|
|IDC Frontier Inc.||100||Data center business|
|ValueCommerce Co., Ltd.||50,6||Ad affiliate marketing service, StoreMatch online advertising distribution service|
|Mobiletech Corporation||100||Holding company|
|SB Energy Corp.||100||Generation of electricity from renewable energy sources, supply and sale of electricity|
|SoftBank Payment Service Corp.||100||Settlement services, card services and related services|
|Fukuoka SoftBank HAWKS Corp.||100||Ownership of professional baseball team, operation of baseball games, management and maintenance of baseball stadium and other sports facilities, distribution of video, voice and data content via media|
|SoftBank Robotics Holdings Corp.||100||Planning, development, and sale of robots|
|SBBM Corporation||100||Holding company|
|ITmedia Inc.||57,9||Operation of comprehensive IT information site ITmedia, etc.|
|SoftBank Technology Corp.||55,4||Solutions and services for online businesses|
|Vector Inc.||52,4||Operation, sales, and marketing of online games, software downloads, advertising|
|SFJ Capital Limited||100||Procurement of funds by issuing preferred (restricted voting) securities|
|SB Group US, Inc.||100||Holding company|
|SB CHINA HOLDINGS PTE LTD||100||Holding company|
|SoftBank Ventures Korea Corp.||100||Holding company|
|SoftBank Korea Corp.||100||Holding company|
|Starburst I, Inc.||100||Holding company|
|SoftBank Holdings Inc.||100||Holding company|
|SoftBank America Inc.||100||Holding company|
|STARFISH I PTE. LTD.||100||Holding company|
|SB Pan Pacific Corporation||100||Holding company|
|Hayate Corporation||100||Holding company|
|*1 On April 1, 2015 SoftBank BB, SoftBank Telecom, and Ymobile, merged into SoftBank Mobile. On July 1, 2015, SoftBank Mobile changed its company name to SoftBank Corp.
*2 eAccess merged with WILLCOM on June 1, 2014 and changed its company name to Ymobile on July 1, 2014.
*3 As a result of the completion of a tender offer by GungHo for its shares on June 1, 2015, and other factors, GungHo became an equity method associate of SoftBank Corp. (currently SoftBank Group Corp.). Please refer to page 190 for details.
*4 Holdings by parties in close relationships, etc., with SoftBank Corp. (currently SoftBank Group Corp.)
*5 SoftBank BB Corp., divided its commerce and service business and newly established SoftBank C&S on April 1, 2014. All shares of SoftBank C&S held by SoftBank Corp. (currently SoftBank Group Corp.) were transferred to a wholly owned subsidiary of Brightstar.
*6 Since GRAVITY Co., Ltd.’s parent company GungHo is an equity method associate, as noted in *3, as of the publication of this annual report, GRAVITY is not a subsidiary of SoftBank Corp. (currently SoftBank Group Corp.).
*7 The Company purchased additional shares of Supercell from existing shareholders on May 29, 2015. After this transaction, the Company’s share of voting rights stands at 77.8%.
July 2015, Major Associates
|Company Name||Voting Rights (%)||Principal Business Activities|
|ASKUL Corporation||41,9||Mail order sales of stationary, office products, services, etc.|
|The Japan Net Bank, Limited||41,2||Banking business|
|BOOKOFF CORPORATION LIMITED||15,0||Auction service and reuse business|
|Scigineer Inc.||33,2||Provision of Internet marketing support services using the personalized engine “deqwas” for e-commerce business operators and retailers|
|Bharti SoftBank Holdings Pte. Ltd.||50,0||Holding company|
|Renren Inc.||43,0||Investor company of company operating Renren.com SNS site in China|
|Alibaba Group Holding Limited||31,9||Investor company of companies operating e-commerce sites Alibaba.com, Taobao. com, and Tmall.com|
|InMobi Pte. Ltd.||35,2||Mobile advertising services|
Main Overseas Fund Data
|SoftBank Ranger Venture Investment Partnership|
|SoftBank Capital Fund ’10 L.P.|
|SoftBank US Ventures VI L.P.|
|SoftBank Capital Technology Fund III L.P.|