Chip licensor ARM has become a clear-cut leader in the mobile market, with its low-power chip architectures fueling a massive 95 percent of the world's smartphones.
But the U.K.-based company is also relying on its hundreds of chip licensee partners to broaden its reach into other client device markets, including digital cameras and TVs.
Jeff Chu, director of client computing at ARM, told CRN the company is focusing intently on aligning itself with the consumerisation of IT and other trends that challenge traditional methods of computing.
Consumers no longer rely exclusively on desktop or notebook PCs to receive information, Chu explained, and ARM is ensuring it stays ahead of that trend by claiming a stake in other, less conventional computing markets.
"We have 95 percent of the mobile market today and, yes, PCs represent an opportunity [for ARM] to grow ... but really what you are seeing is the spill-over effect into other devices, and that ties back to the fact that computing is spreading across all of our devices," Chu said. "Computing isn’t a device anymore; it’s an experience."
One of the markets in which ARM is looking to grow is digital TVs and set-top boxes. Last year, Chu said, ARM held about 40 percent share in this market.
But as more TVs become internet-connected and start to adopt a more PC-like role, it is looking to grow that number to between 70 and 80 percent by 2016.
The digital camera market, where ARM currently holds about 80 percent market share, is another potential area for growth, Chu continued.
ARM’s ability to aggressively go after new markets -- and account for such a large portion of the markets in which it currently plays -- stems from its unique license-based business model.
Its chip architectures are licensed to nearly 275 different companies, ranging from Nvidia to Texas Instruments, which infuse their own technology and then sell the finalised chips to their own respective markets, Chu explained.
This, in turn, allows ARM-based chips to touch a much broader range of markets, a feat that might not be possible without its licensee-based model.
The low-power nature of ARM-based chips also feeds into their ability to be adopted in a variety of devices and markets. Power efficiency, which Chu said is "inherently" part of ARM’s architecture, is especially critical to mobile devices like smartphones and tablets, where battery life can deplete quickly if power isn’t conserved.
Not worried about Intel’s mobile initiative
Despite its expansion into new markets, mobility will always be ARM’s bread and butter. Apart from already being the foundation for 95 percent of today’s smartphones, ARM has a growing presence in the tablet space as well.
Next-generation devices, including Asus’s Transformer Book and Google's Nexus 7 tablet, have already launched this year based on ARM’s low-power processor architectures.
What's more, software giant Microsoft went so far as to develop a separate version of its upcoming Windows 8 operating system optimised specifically for ARM-based mobile devices.
The software, known as Windows RT, will launch later this year on a variety of tablets, notebooks, and hybrid PCs from OEMs including Dell and Lenovo.
As a growing number of OEMs place an emphasis on mobile computing, rival chip-maker Intel has been gradually vying for a piece of the market, a move that could introduce a new level of competition for ARM.
In January, Intel announced a "multi-year, multi-device" strategic partnership with Motorola Mobility, through which the handset maker will produce new devices based on Intel’s "Medfield" Atom processor.
Other handset makers, including Lenovo and Chinese vendor ZTE, have also signed on to develop new mobile devices based on Medfield chips.
Chu said that ARM's sprawling list of chip licensees, however, will continue to give it a leg up in the mobile market, despite Intel’s debut.
ARM's license-based business model means Intel won’t just face off against ARM; it means the company will face off against Nvidia, Qualcomm and a slew of other ARM licensees that have already made a name for themselves in the tablet and smartphone space.
"I think you really have to think about our success being driven by our partners' success. I think you have to look at that sort of breadth of products that are actually in the market place and say it’s really not about ARM versus Intel," Chu said.
"Intel has to compete with Qualcomm, they have to compete with Nvidia, they have to compete with TI [Texas Instruments], they have to compete MediaTek, with Broadcom, with Freescale. There is a whole number of companies that Intel has to compete with in that market."
Chu also noted that the core processor is just one of many aspects that make up the full system-on-a-chip (SoC) that goes into a smartphone.
Intel, because of this, will need to bolster an ecosystem of partners that can help it round out its chip offering with other smartphone-essential features, such as graphics, integrated modems, connectivity solutions and touch displays if it plans to compete on a serious level.
"All of these companies are competing, and they are competing really, really heavily," Chu said of the smartphone chip market. "Is Intel ready to play in that market, as well? It's a different world than what the legacy PC world has been like for the last 20 years."