by Jim Lundy

Yesterday, Nvidia announced its intent to purchase ARM from SoftBank for the price of $40 billion. ARM has emerged to become one of the dominant chip architectures of this century. Last year alone, over 22 billion devices were powered by ARM chips. This blog discusses the deal and the implications for others such as Intel.

SoftBank sells ARM to Nvidia

SoftBank, which actually used to own Nvidia before it sold it, agreed to sell it ARM Holdings. The implications of this are substantial, as it brings the top chip architecture together with one of the top AI GPU providers in the world. 

The combination of ARM and Nvidia remixes the semiconductor industry with a focus on AI, which has been the backbone of Nvidia for many years. 

ARM and Mobile

Many mobile firms have made their chip design decisions based on the ARM architecture. This gives oversight and innovation control to each individual vendor.

Apple has used the ARM processor in the iPhone since the beginning, and so has Samsung for their mobile phone. The efficiency of ARM-designed processors combined with their outstanding performance for playing rich media such as video, makes them ideal for consumer video entertainment use cases. 

Founded in 1990, ARM was already on a roll by 2012, 5 years into the smartphone era. From 1990-2012 a total of 30 billion devices had been shipped with ARM-designed processors. In 2019, that number jumped to 22 billion.

The End of the Intel Era

The design paradigm for Microsoft Windows centers completely around the use of Intel processors. The rise of ARM really occurred at the beginning of the modern smartphone era with design decisions made by vendors such as Apple.

One could argue that the App Store model of design that ARM deployed allowed vendors to innovate at a faster pace than Intel—this is essentially what has happened in the smartphone era. Today, ARM dominates and Intel is nowhere to be found.

The era of the Intel laptop may be coming to a close. 

Is the End of the PC Era Coming for Intel?

With all of its success on mobile devices, it’s hard to argue with the design innovation that the ARM architecture provides to vendors.

If there’s any proof of that it has to do with Apple, which originally started with the PowerPC architecture, shifted to Intel and is now shifting all of its MacBook designs to ARM-based processors. In fact, the first MacBook will ship this fall with an ARM processor. Demos of that unit show it being blindingly fast, playing more than four video files at once.

With new base laptops, we expect extremely high battery efficiency given their power consumption. This opens up a new era for portability and new frontline worker use cases.

What Will Microsoft do with Windows?

The Microsoft windows era is powered by Intel processors, and that design paradigm has been dominant from 1990 until now. Shifting to a new process design would require re-compiling millions of software applications—however, Apple just showed that they can do it.

The Bottom Line

The bottom line is that we are leaving the era of Intel computers, the era which has been dominant for close to 30 years. Apple's adoption of ARM and Nvidia's purchase both signal that ARM Holdings is well-positioned to succeed in the next generation of chip architectures.