Qualcomm Inc. signage is displayed outside the company's offices in La Jolla, California, U.S., on Tuesday, Aug. 23, 2011. Qualcomm is the biggest maker of mobile-phone chips, and also owns some of the technology used in advanced, third-generation wireless services. Photographer: Konrad Fiedler/Bloomberg via Getty Images

Microservers and the motivations for microservers have been around for years. I first blogged about them back in 2008 (Cooperative, Expendable, Microslice, Servers: Low-Cost, Low-Power Servers for Internet-Scale Services) and even Intel has entered the market with Atom but it’s the ARM instruction set architecture that has had the majority of server world attention.

There have been some large data center deployments done on ARM servers and the ARM server market entrants have been many. At one point, I knew of nine semiconductor companies that were either in market or going to enter the market.  Currently the biggest players in this nascent server market are AppliedMicro and Cavium. The most recent AppliedMicro part targets higher clock rates but with lower core count whereas the Cavium Thunder delivers a somewhat less powerful core part with 48 on die. AMD is also targeting the ARM server market.

Over the last 2 years, the ARM Server group of companies targeting ARM Servers has thinned somewhat with Calxeda going out of business and Samsung electing to leave the market. But Cavium, AppliedMicro, and AMD are still committed and Qualcomm recently did a press event essentially saying “this time we really are serious”.  Qualcomm is particularly interesting in that they produce some of the best and most used mobile systems. And, for those that know them well, they have hired a good server team and there is no question that the team is capable of delivery, the company can fund a successful market participant, and they have a long history of proven custom CPU designs based upon the ARM architecture. But considerable time has passed and, although Qualcomm continued to talk about ARM Servers and continued to work on ARM Server designs through this period, they never really seemed any closer to delivery.

The press event last week is the public signal that Qualcomm really are serious about this market and they made the commitment real by announcing an initial 24 core server. This new 24-core server CPU is already sampling.  I’m personally not super excited about this initial Qualcomm offering but I am excited to see them now in market and committed to server-side success. They have a high quality, dedicated team focused on producing compelling server chips and they plan to do a custom ARM design. They report the next version is well along, and from all I have seen so far, it’s real and will be a performer.

In the past, I’ve been quoted as disappointed in the pace of ARM server innovation (e.g. Amazon Engineering Says ARM Chips Lag Intel in Innovation). To a large extent, that remains true today but here are several important factors emerging that together stand a good chance of making an ARM server a real market competitor:

  • Volume Economics: Qualcomm is the CPU supplier for many of the world’s leading smartphones and, overall, ARM powers just about every mobile phone on the market. We know all the big server architectural changes where driven by superior volume economics coming from below.  Intel beat the UNIX Super Servers on the strength of the R&D stream funded by the Intel client business.  ARM and all of ARM Partners including Qualcomm, Samsung, and literally 100s of others all gain from these volume economics.  Historically, the volume client part producers eventually win in server.
  • Process Technology: One of the most challenging aspects of Intel as a competitor is they are competent in overall semiconductor design. They produce good parts. And they are good at market development so the ISA is well supported and has all the important applications. All of these factors are important but where Intel has been positively unstoppable is in process technology. They have been at least one full process generation ahead of the rest of the industry. A full process node better means Intel has more processor real estate to work with, or can get higher yields with a smaller part, and has a power advantage as well. Intel’s dominance has been driven by the massive market share driving the highest semiconductor R&D budget in the world. But, the mobile world has changed all that.  This year both Samsung and TSMC are outspending Intel in semiconductor R&D and it is not expected that Intel will retake the top spot in the near future. TSMC makes Apple mobile and Qualcomm CPUs and is, by far, the largest FAB-as-a-service provider in the market.  TSMC is huge, Samsung is spending even more, and both are investing Intel.  More R&D doesn’t necessarily translate to better results but all indications are that all three competitors are going to deliver the 7nm process node at about the same time. It looks a lot like the process technology generational advantage that Intel has enjoyed for years is being eaten up by the massive mobile and embedded part ecosystem R&D investment.
  • Vibrant Ecosystem: ARM has literally 100s of licensees all starting with the basic ARM design and adding proprietary intellectual property, additional functionality, or packaging differently. Samsung, Apple, Qualcomm and all the rest all have the advantage sharing the initial IP investment and, perhaps more important, all have the advantage of a shared tool chain with rapidly improving compilers, Linux distros, and other tools all supporting ARM. Most of the Internet of Things market bigger than microcontrollers will be ARM based. The Raspberry PI is ARM based. The Android devices I used every day are all ARM-based (by Chance, all my mobile devices use Qualcomm CPUs but my Raspberry Pi is Broadcom powered.
  • China: China is “only” a single country but it’s hard to talk about a country with more 1.3B people and use the word “only” in the same sentence. China has massive influence and, today, several of the major high scale Chinese infrastructure providers are deploying ARM servers aggressively. The Chinese market alone could fund the needed R&D stream to produce good server parts.
  • Cloud Computing: More and more of the server processor volume is being purchased by the large cloud computing providers. Even though it’s still very early days for cloud computing, all the big players have 10s of data centers, with 10s of thousands of servers in each. The big players had a million servers a long time ago and continue to deploy at a staggering pace. AWS, as an example, just announced over 80% usage growth over the last year on what was already a massive base. This changes the server market dynamics in that the cloud providers are willing to take on big challenges and do buy in enough volume that they can create an tool and app ecosystem nearly on their own. Interestingly, Google, Microsoft, and Amazon are all ARM licensees. The cloud changes what is possible in the server market and the vast size of the major cloud deployments make many of the big changes previously thought impossible seem fairly practical.

Clearly Intel still makes the CPU behind more than 90% of the world’s servers (even when taking a very generous interpretation of server). And, just as clear, Intel is a very competent company that has in the past responded quickly to competitive pressure.  Intel has also gotten very good at working closely with its major customers and, unlike the bad old days, is actually very good to work with. I’m more impressed with what they have been bringing to market than ever. Nonetheless, there are factors that make it very likely that we are going to see some very good server parts based upon ARM in market in the near future.  It’s hard to predict the pace of execution of any of the participants nor where this will end up but, generally, change and competition is good for the industry and great for customers.

I’m glad to see Qualcomm serious about the server CPU market, it’s good to see their first market entrant already sampling, I’m excited by what the next version might deliver, and it’s good to see the ARM-based server parts out there and the investment ramping up. Remember when server-side computing was boring? :-)

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