Microsoft Is Working On Arm-Based Chips For Azure

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Microsoft is reportedly designing Arm-based chips for Azure servers and some Surface PCs, signalling the computer giant’s increasing willingness to lower its reliance on Intel.

Bloomberg reported Friday that the Redmond, based company is working on in-house processor designs for its own servers that run Azure, mirroring an effort by (AWS) Amazon Web Services, which has already begun offering cloud instances using its own Arm-based server CPUs, Graviton.

Unnamed sources familiar with the plans said Microsoft is also exploring its own chip designs for some Surface PCs, which already include models with chips co-designed with Qualcomm and AMD separately.

Frank Shaw, corporate vice president of communications at Microsoft, confirmed that the company is investing in its own chip design capabilities.

“Because silicon is a foundational building block for technology, we’re continuing to invest in our own capabilities in areas like design, manufacturing and tools, while also fostering and strengthening partnerships with a wide range of chip providers,” he said.

An Intel spokesperson said the company is expected to gain share in emerging and expanding markets like AI training, 5G networks, graphics and autonomous driving.

“The incredible demand for computing fueled by new workloads like AI is driving more silicon experimentation in the cloud,” the spokesperson said in a statement. “Building on decades of x86 ecosystem innovation, we are committed to providing customers the world’s best CPUs and new products from GPUs to AI chips.”

Arm, which licenses chip designs to companies that make their own processors, has been making a bigger push into the data centre over the past few years with its Neoverse platform. In September, the company revealed its V1 and N2 core designs, both of which Arm said significantly outperform CPUs made by Intel and AMD while also having high energy efficiency.

“The emergence of Arm in the data centre is being powered by many factors: customization, efficiency, ecosystem diversity, but all of that builds on top of performance,” Chris Bergey, senior vice president and general manager of Arm’s infrastructure business, said in September. “If Neoverse wasn’t delivering a significant measurable value proposition you would not see the market adoption and momentum that we are achieving.”

But Arm has also been finding more success with client computers in recent times, most notably with Apple’s Arm-based M1 processor, which is now available in a few Mac models. Apple has said that the M1 can outperform competing processors by up to two times.

Adding to the intrigue is that Nvidia, a semiconductor company that primarily makes GPUs but is also starting to build its own server systems, is in the process of acquiring Arm from its current owner, SoftBank, for $40 billion.