

The Economist on Intel versus ARM - malay
http://www.economist.com/node/21542402

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jfruh
Aw, someone at the Economist is a sci-fi nerd: all the subheds in the story
are titles of Isaac Asimov stories (or spoofs of said titles).

~~~
troymc
I hadn't noticed that until the last subheading:

The chips, like dust -- references The Stars, Like Dust, a 1951 book by
Asimov.

And then the rest became clear:

Empire and foundry-nation -- probably a play on Foundation and Empire, the
second novel in Asimov's Foundation Trilogy.

"The Dead Past" is an Asimov short story first published in 1956.

"The Wedge" is a short story Asimov published in 1944.

"Birth of a Notion" is a 1976 short story by Asimov.

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malay
This story of Intel and ARM is fascinating because it is likely to become one
of the purest case studies of disruption theory. If ARM can successfully
change the basis of competition in the server market to power consumption
versus pure performance and disrupt Intel, it will be another powerful
example.

On the other hand, if Intel can actually capture share in the low end market
(mobile devices) by hitting the right power-performance mark, they will
provide a great example of how an incumbent can successfully fend off a low
market entrant. Andy Grove would be proud.

If Intel manages to win in this next phase of computing, it will hopefully
start to give companies pause before they outsource what some consultant
deemed to be "non core" (manufacturing, in this example). Christensen has
pointed out how much damage this is doing to long term results [1].

[1]
[http://www.forbes.com/sites/stevedenning/2011/11/18/clayton-...](http://www.forbes.com/sites/stevedenning/2011/11/18/clayton-
christensen-how-pursuit-of-profits-kills-innovation-and-the-us-economy/)

~~~
lsc
eh, Intel, right now, could own the microserver/power sensitive server market.
The Pentium 350 is a step in that direction, If they'd sell me pentium 350
chips, I could sell very fast, very cheap servers with ecc ram. But Intel
won't sell them to me.

Intel has a long history of nerfing their low-end products so that they
compete less with their high end products.

The question is will intel make a good low end chip (and not castrate it)
before arm makes a reasonable server board? I mean, it's clear that Intel
/can/ the question is if it /will/.

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troymc
Some commentary at SemiWiki:

[http://www.semiwiki.com/forum/content/941-economist-arm-
vs-i...](http://www.semiwiki.com/forum/content/941-economist-arm-vs-
intel.html)

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erichocean
This article pretty much refutes the idea that an ARM vs. Intel battle is
brewing: [http://www.semiwiki.com/forum/content/935-tracking-big-
semic...](http://www.semiwiki.com/forum/content/935-tracking-big-
semiconductor-story-2012.html)

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thoughtsimple
Interesting factoid:

"Between them they shifted perhaps 8 billion ARM-based semiconductors in 2011,
half of them in mobile phones and mobile computers, the other half embedded in
consumer items and elsewhere."

"According to IDC, a research firm, the market for PC-powering chips that use
Intel’s x86 processor architecture, which Intel dominates, was about 400m last
year."

8 billion ARM chips to 400 million x86. I hadn't realized that the disparity
was that big. No wonder Intel is desperate to get some mobile wins.

~~~
ajross
It's a terribly apples-to-oranges number. Starting with the basics, there's
simply no such thing as an "ARM chip". Essentially all of those 8G units are
SoC chips where the ARM core(s) make up a comparatively small fraction of the
die area. Most of those SoCs actually have multiple ARMs actually, using
smaller cores as asymmetric multiprocessing (c.f. the "baseband" CPU on most
android phones), but they're mixed in with a bunch of DSP units, memory
controllers, I/O and of course a giant GPU. The fraction of the product
represented by ARM Ltd. IP is probably less than half.

Likewise, when you compare the numbers when represented as total silicon die
area (Intel CPUs are _much_ larger) or in terms of computation capacity
(they're a ton faster too) it's much closer.

~~~
tesseract
Also there are an awful lot of ARM7, ARM9, Cortex-M, etc. cores in
microcontrollers and that market is very different from where Intel is
competing.

~~~
copper
Don't forget the high-end FPGA's, too - that's where ARM's licensing gives
them a decisive advantage (not least because if you're using one of them to
prototype something, you will end up producing your ASIC with licensed
components from ARM anyway.)

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cek
I find it super interesting that Microsoft (in 2010) bought an ARM
architecture license. I think it will be interesting to see what they do with
it (if anything).

[http://www.eetimes.com/electronics-news/4204863/Microsoft-
ta...](http://www.eetimes.com/electronics-news/4204863/Microsoft-takes-ARM-
license)

~~~
DaveMebs
The next release of Windows will run on ARM. This is a key point in the
article.

~~~
jser
Unfortunately, Economist fails to mention that Windows was once ported to
Alpha, MIPS, and PowerPC -- all RISC processors.

~~~
melling
These were to run Windows. The tablet is a different well-defined market. I'd
run a MIPS desktop but most people won't.

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rudiger
Technology reporting at the Economist can be hit-or-miss, but this was a
surprisingly informative read.

~~~
dredmorbius
One of the Economist's trademarks is _not_ providing reporter bylines (though
IIRC contributors are listed in the masthead). The columns, FWIW, are
generally named for _historical_ and not _current_ authors, in print, though
on-line I'm starting to see some bloggy, attributed pieces.

This means that individual ability in writing or covering a specific beat is
really hard to figure out. Given the huge variance and highly idiosyncratic
nature of reporting, I find this to be a major pain.

While I find the Economist to be generally worthwhile reading and can
understand its adherence to tradition, this is something that really should be
dustbinned.

------
mjfern
I posted this article to my blog back in 2010, "The End of x86?" -
<http://fernstrategy.com/2010/10/21/the-end-of-x86/>. It's an analysis of how
ARM is disrupting the x86 architecture (along with Intel).

For the last several decades the x86 architecture, with its major proponents
Intel and AMD, have dominated the CPU market in personal computers (PC).
Today, Intel and AMD control 80.4% and 11.52%, respectively, of the worldwide
microprocessor market (iSuppli, 2010).

Despite the prevalence of x86, there are tell-tale signs that the x86
architecture is in the early stages of being disrupted. Drawing on work by
Clayton Christensen, the classic signs of disruption are as follows:

1\. The current technology is overshooting the needs of the mass market.

Due to a development trajectory that has followed in lockstep with Moore’s
Law, and the emergence of cloud computing, the latest generation of x86
processors now exceed the performance needs of the majority of customers.
Because many customers are content with older generation microprocessors, they
are holding on to their computers for longer periods of time, or if purchasing
new computers, are seeking out machines that contain lower performing and less
expensive microprocessors.

2\. A new technology emerges that excels on different dimensions of
performance.

While the x86 architecture excels on processing power – the number of
instructions handled within a given period of time – the ARM architecture
excels at energy efficiency. According to Data Respons (datarespons.com,
2010), an “ARM-based system typically uses as little as 2 watts, whereas a
fully optimized Intel Atom solution uses 5 or 6 watts.” The ARM architecture
also has an advantage in form factor, enabling OEMs to design and produce
smaller devices.

3\. Because this new technology excels on a different dimension of
performance, it initially attracts a new market segment.

While x86 is the mainstay technology in PCs, the ARM processor has gained
significant market share in the embedded systems and mobile devices markets.
ARM-based processors are used in more than 95% of mobile phones
(InformationWeek, 2010). And the ARM architecture is now the main choice for
deployments of Google’s Android and is the basis of Apple’s A4 system on a
chip, which is used in the latest generation iPod Touch and Apple TV, as well
as the iPhone 4 and iPad.

4\. Once the new technology gains a foothold in a new market segment, further
technology improvements enable it to move up-market, displacing the incumbent
technology.

With its foothold in the embedded systems and mobile markets, ARM technology
continues to improve. The latest generation ARM chip (the Cortex-A15) retains
the energy efficiency of its predecessors, but has a clock speed of up to 2.5
GHz, making it competitive with Intel’s chips from the standpoint of
processing power. As evidence of ARM’s move up-market, the startup Smooth-
Stone recently raised $48m in venture funding to produce energy efficient,
high performance chips based on ARM to be used in servers and data centers. I
suspect we will begin seeing the ARM architecture in next generation latops,
netbooks, and smartphones (e.g., A4 in a MacBook Air).

5\. The new, disruptive technology looks financially unattractive to
established companies, in part because they have a higher cost structure.

In 2009, Intel’s costs of sales and operating expenses were a combined $29.6
billion. In contrast, ARM Holdings, the company that develops and supports the
ARM architecture, had total expenses (cost of sales and operating) of $259
million. Unlike Intel, ARM does not produce and manufacture chips; instead it
licenses its technology to OEMs and other parties and the chips are often
manufactured using a contract foundry (e.g., TSMC). Given ARM’s low cost
structure, and the competition in the foundry market, “ARM offers a
considerably cheaper total solution than the x86 architecture can at present…”
(datarespons.com, 2010). Intel is loathe to follow ARM’s licensing model
because it would reduce Intel’s revenues and profitability substantially.

In short, the ARM architecture appears to be in the early stages of disrupting
x86, not just in the mobile and embedded systems markets, but also in the
personal computer and server markets, the strongholds of Intel and AMD. This
is evidenced in part by investors’ expectations for ARM’s, Intel’s and AMD’s
future performance in microprocessor markets: today ARM Holdings has a price
to earnings ratio of 77.93, while Intel and AMD have price to earnings ratios
of 10.63 and 4.26, respectively.

For Intel and AMD to avoid being disrupted, they must offer customers a
microprocessor with comparable (or better) processing power and energy
efficiency relative to the latest generation ARM chips, and offer this product
to customers at the same (or lower) price point relative to the ARM license
plus the costs of manufacturing using a contract foundry. The Intel Atom is a
strong move in this direction, but the Atom is facing resistance in the mobile
market and emerging thin device markets (e.g., tablets) due to concerns about
its energy efficiency, form factor, and price point.

The x86 architecture is supported by a massive ecosystem of suppliers (e.g.,
Applied Materials), customers (e.g., Dell), and complements (e.g., Microsoft
Windows). If Intel and AMD are not able to fend off ARM, and the ARM
architecture does displace x86, it would cause turbulence for a large number
of companies.

~~~
niels_olson
> The current technology is overshooting the needs of the mass market.

I was actually thinking of starting a thread about throwing away computers:
does anyone else find it hard to throw away old computers these days? I have a
core 2 duo sitting on my desk right now, in the box. I can't convince myself
to put it in anything, yet, I can't throw it away. I feel like I'd be throwing
a way a supercomputer.

~~~
asciident
Which cpu is it? A lot of computers are still on LGA 775 (socket T), like the
Pentium D. So it could easily be a drop-in replacement for some older CPU. I
would gladly take it off your hands if you lived near me.

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bmajz
This was pretty solid overview of the ongoing semiconductor wars. It should be
interesting to see what kind of impact Windows 8 running on ARM will have for
this industry.

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wisty
>Using a three-dimensional chip design Intel plans to shrink that even further
over the next couple of years, to 22nm and then 14nm, and sell chips that beat
the competition on both energy-efficiency and performance.

/facepalm.

The rest is pretty good, though, I think.

~~~
Klinky
What is wrong with that statement? Intel is using a new 3D Tri-Gate Transitor
tech for 22nm & have plans for 14nm in the future.

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wmf
Pretty much everyone outside Intel thinks FinFETs should not be called 3D,
since 3D was already used to refer to die stacking.

~~~
sern
Not to mention that chips are already 3D with multiple metal layers.

