Big tech is having its wings clipped by competition watchdogs – good!

Big tech is finding itself on the back foot. Two recent developments clearly demonstrate the shift in the political mood towards Silicon Valley and the way regulators have acted on it.

The first is Nvidia’s contentious attempt to buy Arm Holdings, the UK chip designer, from its current owner, Japan’s SoftBank, which took the Cambridge-headquartered group private in 2016.

The $40bn (£30bn) deal – it could be worth quite a bit more now given the way Nvida’s share price has surged – was controversial from the outset.

Arm is chip-Switzerland. It doesn’t actually make them. Anyone can use its designs to do that, just so long as they pay the required royalties.

Nvidia, best known for its graphics-processing units, used in the video-games industry, is a different beast. It does make chips and rivals fear it could restrict access to Arm’s tech, which is used by a dizzying array of companies.

They have been heard, and loudly. Towards the end of last week America’s Federal Trade Commission sued with the intention of blocking the deal.

The decision, by a body that has been staffed by the Biden administration with people far more sceptical with respect to mergers and acquisitions than was perviously the case, came just a couple of weeks after the UK’s announcement of a Phase 2 investigation on both competition and national security grounds.

If the US system is legalistic, the UK’s is just messy. The Competition & Markets Authority (CMA) will handle both sides of the probe. However, while it will make the final decision on the competition side, Nadine Dorries, the secretary of state for culture, media and sport, has the call on the national security implications.

That, obviously, brings politics into it but given the US move, the fact that the EU is also in there and the hostile rumblings towards the deal from China, it may not matter.

It’s starting to look like a race between regulators to be the first to stamp the papers with a big red “no”. SoftBank may have no choice but to offload the business via a flotation in either London or New York because it’s hard to see a potential purchaser that wouldn’t run into similar problems.

Wall Street is starting to wake up to the fact that things have changed, dramatically. When the deal was announced the feeling was it would go through, maybe with some conditions attached because that was what always used to happen. Now? Not so much.

The other regulatory development provides another demonstration. It involves a much smaller deal, Facebook’s purchase last year of Giphy, a database of gifs, for a reported $400m, about one per cent of the purchase price of Arm.

What makes it significant is the CMA’s ordering of the company to unwind the acquisition.

The regulator said the deal would remove a potential competitor for advertising from a market in which Facebook already has around 50 per cent. It fined the company £50.5m during the course of its Phase 2 probe, juicing the purchase price by quite a bit in the process.

Can the UK regulator really kibosh a deal involving two US companies? Well yes, in theory it can. It has jurisdiction. It had the same involving previous, much bigger and more significant Facebook deals involving the likes of Instagram and WhatsApp. Which were waved through.

A huffy Meta, the parent company of Facebook, which is threatening an appeal, might very well ask why the big fuss now about such a relative tiddler when the mega deals were just fine and dandy.

The answer is that change of mood.

Politicians and regulators have woken up to the fact that allowing giants to swoop in and gobble up all the larvae they feel like stymies the potential development of interesting, innovative and potentially disruptive (in a good way) companies to the detriment of the market.

The calls from some, notably US senator Liz Warren, for a break-up of big tech probably aren’t going to come to much. It would take a really determined political push for that to happen when Washington is riven with dysfunction. The EU could chance its arm. Competition commissioner Margrethe Vestager has certainly levied some chunky fines. But a break-up? Perhaps not.

Notice has, nonetheless, been served. Big tech’s big fish are going to find it harder to plunder their favoured feeding grounds. Deals, whether huge (like Nvidia’s) or small (like Meta’s), are going to have to clear a much higher bar in future.

The industry will surely push back, forcing the world’s competition regulators to demonstrate a steeliness they haven’t always displayed in the past.

But the political tide has turned in favour of them doing that and on Friday, the CMA and the US’s Federal Trade Commission and Department of Justice issued a statement hailing their “common goals” and “possibilities for us to implement robust cross-border enforcement regimes”. You could call that a statement of intent.

A welcome one. Big mergers have been too easily waved through in the past. The appalling power wielded by big tech’s titans is testament to that.