Arm Holdings: “Intel Cannot Outrun Us”

Arm Holdings has been in the business of designing chip for different handsets and smartphones such as the popular Apple iPhone for more than a decade now. Arm Holdings reign in the business is unquestionable, but now they are facing rivalry with another company named Intel. Just recently, Intel exhibited the smartphone LG Electronics GW900 based on the company’s patent Moorestown platform.

While Intel strives to get into the world of smaller devices, Arm Holdings is targeting the products termed as smartbooks. These so-called smartbook products like e-readers, tablets and low-cost laptops are where Intel expertise lays and now Arm Holdings is now aspiring Intel’s turf. The PC manufacturers Lenovo and Hewlett-Packard Co. announced that they are currently developing a low-cost Skylight smartbook consisting of a Qualcomm’s Snapdragon processor designed by Arm Holdings.

Although Arm Holdings dream of gaining control on smartbooks is difficult, they still have a positive outlook. Today, almost all laptops are run by an Intel chip and the universally used Microsoft Windows Operating Systems only works with Intel x86-type chips and does not support laptops with Arm Holdings processors. Still, Arm Holding believes that their devices based on Google’s Linux OS Android and Chrome will be appreciated by users.

Last week Arm Holdings CEO Warren East had an interview at the International Consumer Electronics Show. The CEO answered many questions about the competition in the market, product issues and of course Arm Holding’s future goals.

Here is an edited interview of IDG News Services interview with Arm Holdings CEO Warren East.

IDG: Intel is now entering the world of smartphones and the company currently designed a 5-inch screen model. Does Arm Holdings already feel the challenge brought by Intel joining the market?

East: We have been mentioning before that Arm cannot continue to have 100 percent share on all mobile phone processors. Even though Intel is now making actions, we still think that it would take the company years to finally make a significant change in the smartphone world. Before Intel can change fields, their product should be better than what others already offered. Maybe after some time Intel can equal with Arm’s current position in the market but they will never outrun us because each year Intel spent to match Arm, Arm definitely stepped to the next level.

IDG: Even though Arm already proved its worth in the smartphone market, Intel is known for having manufacturing capabilities and they are showing strong road plans. So how does Arm prepare for this?

East: Intel’s road map might be strong but Arm Holdings does not just stand still and watch. Arm constantly make self-improvements, we changed from Arm11 to Cortex-A8 and now Cortex-A9 devices. We are still currently generating a much improved product after Cortex-A9 and we promise better performance with this next generation. Moreover, Arm Holdings has plans for 64-bit processor.

In the semiconductor industry, Intel might be considered excellent and we can say that the company has advance technology than other firms like IBM, GlobalFoundaries and TSMC. Arm, on the other hand, already finished designing its 22-nanometer process and we expect to have 32-nanometer technology in the middle of this year. We do not really think that Intel has process advantage. It is true that over the years Intel might have further growth in the market, but this is expected from a big market where consumers want to try different things. However, Intel having a significant progress is difficult to happen.

IDG: Intel inferred that Arm is weak in software development ecosystem and they believe this is the area where they have an advantage. How have you been improving your software ecosystem?

East: Unlike what Intel said, Arm ecosystem is definitely secured. Intel might be mistaken and what they are really noticing is the PC software ecosystem around Arm and not exactly Arm ecosystem. It is certainly true that for the last 25 years Intel processors control PC applications. But this is not the case in the world of mobile Internet- it’s definitely ruled by Arm.

In order to provide customer satisfaction, a computer needs to have the best browser, quality plug-ins and excellent operating system. Intel cannot presume that they are the leader in the world of computers because Microsoft took 25 years to fulfill excellence and Windows are the operating system expected in PCs. The truth is most customers do not mind about operating systems or the technology at all. For Arm, there are many browser, enablers and plug-ins to choose from.

IDG: Arm announced before that the company’s focus is on application processors for servers but until now there are no product releases. What is the real major goal of the company?

East: I want to say that the company’s goal is more progress, but the word has a broad meaning. For us back-end of the cloud is important. The real issues are about power rates and consumption, and this is what Arm has been aiming forward. We have been starting together with Arm’s primary semiconductor partners and some blue-chip companies who manufacture equipment and servers.

IDG: Low-cost laptops like smartbooks and netbooks has been emerging. What is the effect of these products to Arm?

East: Arm already expected the emergence of smartbooks and netbooks but our focus is not about form factors. The goal of the company is to capture customers by providing very low power consumption of computers with high level of integration. This is what Apple did with iPhone, they made the devices easier to manage and disregarded the technologies that gave consumers a hard time to follow. And this is what we are doing, providing consumers what they really need.

IDG: Microsoft said that Windows operating systems old and new versions will not support Arm. Is Arm trying to persuade Microsoft for Windows compatibility?

East: With or without Microsoft, we are confident of our products. If Microsoft does not want to support Arm compatibility, it’s their loss too and not ours alone. However, this is for Microsoft to decide. But Arm still wants to pursue the Windows logo on its products and hopes that Microsoft agrees. We are open to every opportunity for improvement and having Microsoft is one goal. If ever, the deal with Microsoft will not come, Arm can still manage without Windows. Again, this is not only a lost for Arm but it will also be difficult for Microsoft because they are carrying 25 years of baggage.

IDG: What do you mean by that baggage?

East: It is the issue with old printers. New PCs still works with old printers, no matter what. So Microsoft has to make this available for Arm as well which is a big maintenance job.

IDG: Arm is till having compatibility problems and the issues with Linux will take some time to clear up. Do you think this will cause problems for people who are used to Windows?

East: We believe that this will not going to be an issue. If people would remember the achievements made from the past two years and compare it to the 25 years of Windows & Intel monopoly, it will be clear that Linux-based PCs are also having a good place in the market. In just two years, Linux managed to catch up and that is really an accomplishment.

IDG: What more can Arm offer?

East: Changes and improvements in mainframe computers can also happen in integrated chips. Soon, there will be 64-bit processors, virtualization and more developments. These are the things consumers should await. For each microprocessor that we design, we are always looking at the bigger picture. Chip size decrease while the speed heightens. Arm applies classic computer architecture and we try to solve different issues at the same time.

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