Andy Grove famously said: "We have a simple strategy. We build fabs, and then we fill them."<p>That is not just a glib remark. Intel builds leading edge fabs, and runs them very well. Then it simply looks at every design it could run, and ranks them by gross margin per wafer. When the fab is full, low margin projects either run on non-Intel fabs or alternatively the teams get redeployed.<p>And the kind of fab capacity Intel has is a strategic weapon. If Intel decides your corner of the market is going to be paved with silicon, prepare to get paved over.<p>My take on Intel licensing ARM is two-fold: 1) They have decided the gross margin per wafer of running some ARMs is looking pretty good, and 2) they perceive a benefit of using Intel's fab technology as a strategic weapon to own as much of the ARM market as they want.
Intel's always maintained some of the leading fabs with technology usually a fair bit ahead of their competitors, but it is losing an entire segment of the processor design space. It is pretty big news that instead of continuing to make their own plays at these markets, (which haven't worked out) they're allowing others to ship their own ARM designs using their fabs. Intel's competitive advantage has always had a lot to do with the integration and bundling of world class fabrication technology and their processor designs pushing each other forward.<p>They've increasingly broken this cycle in the past few years, with the final demise of tick-tock and the continued number of devices which opt for ARM.<p>It's another in a series of developments that are reshaping the processor market and slowly moving Intel from a dominant position to a supportive one.<p>There's still a large number of brilliant engineers and amazingly competent people there. I wonder when they're gonna start really fighting for their future.
Relevant quote from Otellini, the former CEO<p><i>"The thing you have to remember is that this was before the iPhone was introduced and no one knew what the iPhone would do... At the end of the day, there was a chip that they were interested in that they wanted to pay a certain price for and not a nickel more and that price was below our forecasted cost. I couldn't see it. It wasn't one of these things you can make up on volume. And in hindsight, the forecasted cost was wrong and the volume was 100x what anyone thought."<p>It was the only moment I heard regret slip into Otellini's voice during the several hours of conversations I had with him. "The lesson I took away from that was, while we like to speak with data around here, so many times in my career I've ended up making decisions with my gut, and I should have followed my gut," he said. "My gut told me to say yes."</i><p>Source: <a href="http://www.theatlantic.com/technology/archive/2013/05/paul-otellinis-intel-can-the-company-that-built-the-future-survive-it/275825/" rel="nofollow">http://www.theatlantic.com/technology/archive/2013/05/paul-o...</a>
Well that feels a bit like when Intel caved and put the AMD64 extensions into x86, and a bit not.<p>I saw an interesting draft of a white paper that was pointing out the challenge of maintaining a technical advantage when you have to fab your chips with someone else. Especially if that someone else is under the nominal influence of a nation state that is hostile to your best interests. It was arguing that either Global Foundries needed to be "aligned" with US interests and oversight, or Intel needed to be drafted as "America's chip baker." The consequence of not doing so would be to create a threat to national security where the government had no way to procure the volume and complexity of chips they would need from a source they could be 100% sure was not out to get them.<p>And then there was this IDF announcement.<p>It is amazing how hard it is to imagine building a chip company "from scratch" which includes fabrication facilities. And it is hard not to see how important such chips have become in our day to day lives.
Intel had no choice but to make this move. That is because it has failed in the mobile and embedded/IoT space, and it isn't selling enough x86 chips to keep its new fabs up to capacity, so it needs to also make ARM chips.<p>That said, the economics of this are pretty uncertain. Intel's business model is to spend an enormous amount of money on process R and D and cutting-edge fabs so it can produce the most advanced chips, and charge premium prices that pay off these costs. It can charge such high prices because x86 dominated computing, and it has had little real competition in the x86 space.<p>The ARM model, in contrast is to produce large numbers of chips at low cost for markets with many competitors and intense price competition. If Intel charges typical ARM prices, it won't be making enough money to pay for its fabs and R and D costs. If it charges premium prices, it will be more expensive than everyone else and won't sell many chips, and again won't make much money. My guess is Intel will go the latter route and make a relatively small number of premium ARM chips for the highest-end, most expensive smartphones. Better than nothing, but hardly a great success.
Funny how both Apple and Intel (xscale) had a bet on ARM, chose to abandon it, only to come back to it later.<p>Apple's history with ARM is particularly interesting and not very well known IMO. It looks like this Intel's new move will be at least as fun to watch.
I find the chain of events a bit ominous frankly. How does Intel's high cost structure and margins sync with $10-30 SOCs? It's already tried and failed with its own mobile offerings.<p>On the other side ARM is beginning to deliver increasingly powerful SOCs that are at least getting close to Intel's woeful laptop cpu offerings.<p>It was looking like Intel could be in trouble. I mean why spend $150-300 just for CPU when you can get a powerful SOC for $10-30 with CPU, GPU and Memory all in one? There was no way Intel could compete with that.<p>If ARM desktops started appearing with proper Linux and Windows support, or Apple decided to put the iPad Pro SOC in a Macbook it could be trouble. Fortunately for Intel ARM chooses not to focus on this market even though the potential for low cost desktops and laptops powered by ARM is huge, with great cost savings for consumers. Driver issues hold back independent efforts. Vulcan and the new generation of mobile GPUs offer a ray of hope.<p>Then out of the blue Softbank buys ARM. Now Intel is licensing ARM nevermind Intel business model does not allow the kind of low cost SOCs ARM is popular for.<p>I hope this is not the beginning of ARM SOCs becoming pricey so Intel is less threatend in its X86 business, that in the absence of competition has frankly become extremely expensive and uncompetitive.
Perhaps in the future Intel will be making "N core" ARM chips for data center blades, where N is a largish number with a killer bus / cache stack attached???<p>Something to be said for low power systems to pass all that relatively simple web traffic (JSON -> prepared statement ... row -> JSON) between the outside world and the databases, which might still well benefit from higher power / performance x86 chips. (who knows, maybe 128 low power cores serves a database better than x86, also, I can't say -- although being charged per-core by Oracle for little cores would really suck)<p>I'm a software guy, so feel free to expand on why this is BS, or not, hardware guys/gals.
This seems about 3 years to late and 6 years after they should have. Processors are a symbiosis of design and manufacturing. Intel pursued the objective function of manufacturing way way to far down a local optimum.
this is not unheard of: <a href="https://en.wikipedia.org/wiki/XScale" rel="nofollow">https://en.wikipedia.org/wiki/XScale</a><p>still looks like big news
Another fab should mean options and with that price decrease.
I wonder how much a given chip price can be decreased with this move.<p>Another way of reading this is that making more use of a given tech should pay the initial cost faster thus making possible more research and improved processes.<p>Sadly another way of reading this is that Intel doesn't have any tech that would capitalize in better chips anymore.
its pretty interesting that ARM was able to gain so much foothold from the UK while historically there were so many competing cpu architectures in the market.