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Google licks its lips at sight of Qualcomm's 64-bit server ARM chips

Anonymous Coward
Anonymous Coward

"Intel will defend the server market like a lioness protecting her cubs. They will expand their highly efficient x64 server architectures and continue to innovate."

Where will they find the money to do this?

The server-end R+D has historically been supported by revenue from volume sales of chips for desktops and laptops.

Outside the commercial IT market, desktop and laptop sales are going nowhere, other devices now offer better value to most people, and that seems unlikely to change in the foreseeable future.

Routine desktops and laptops haven't needed faster processors in general for years, what they do need is cheaper and more efficient processors.

In the last couple of years Intel has spent a fortune on subsidising its "cheaper and more efficient" mobile x86 parts in a largely failed attempt to persuade unwilling manufacturers to use them (look up "contra revenue"). You may not see "contra revenue" written about this year because they've reorganised the divisions in a way which somewhat hides the subsidy from the shareholders.

So, reduced desktop revenue (and negligible mobile revenue) to support the design of next generation server chips. That means the server chip revenue increasingly has to support the server chip R+D on its own. That means there's less money for server chip R+D, *and* it also means that the server chip prices have to go up. Chip R+D costs a fortune and the costs (for an x86 design) are fixed regardless of sales volume. If your sales volumes aren't huge or you don't have money from elsewhere, you're on a decaying spiral...

ARM chips are developed differently; a lot of the R+D/architectural costs are shared with other ARM licencees.

Intel aren't going away overnight, but outside the Windows-dependent market, the change may be quicker than you expect. A bit likewhat eventually happened to IA64, perhaps (and before that, like what happened to Alpha). Lots of people could see IA64 was dead, Intel and HP carried on claiming it was the best thing since sliced bread, and now everyone can finally see what's been obvious for years.

Intel: the x86 company.

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