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Surprise Industry Fact: ARM's Biggest Customer is Intel

By - Source: Netronome | B 22 comments

Who would have thought? This piece originally slipped by under our radar, but it is a noteworthy piece of information, especially since we now know at least one specific ARM chip that Intel is manufacturing ARM cores in its fabs.

In 2010, Intel was ARM's most significant resource of licensing revenue, but it has been unclear which products Intel is paying licensing fees for.

According to an article published by EETimes, about 7.0 percent of ARM's 2010 revenue - $631.3 million - came from Intel. That amounts to about $44 million in licensing fees. The source of this information is Nomura Equity Research, which, however, did not disclose where this number came from and which products it relates to. Netronome, which uses Intel as a contract foundry for its NFP-6xxx series Flow Processor, recently stated that the chips will integrated an ARMv6-based ARM11 core. Depending on the success of the chips, it is likely that Intel's payments to ARM will be increasing down the road.

According to Nomura, TSMC contributes 5.7 percent to ARM's revenue base, Samsung 5.7 percent, TI 4.6 percent, and NEC 3.5 percent. Interestingly, there is also AMD on the list (2.5 percent) - ahead of Infineon, Apple, Qualcomm, Fujitsu, and UMC.

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  • 13 Hide
    icrf , June 11, 2012 4:45 PM
    The largest customer is only 7% of revenue? That sounds like a nicely diversified client base.

    Did I miss it, or is there no link to the source? Googling shows it to be six months old and is really a better write-up on the topic: http://www.eetimes.com/electronics-news/4234459/ARM-customers
Other Comments
  • 5 Hide
    asnorton44 , June 11, 2012 4:10 PM
    ARMy of one
  • 3 Hide
    zak_mckraken , June 11, 2012 4:42 PM
    I don't usually complain about this, but please proof-read your articles. Sentences like "[...] especially since we now know at least one specific ARM chip that Intel is manufacturing ARM cores in its fabs." gives me a headache.
  • 13 Hide
    icrf , June 11, 2012 4:45 PM
    The largest customer is only 7% of revenue? That sounds like a nicely diversified client base.

    Did I miss it, or is there no link to the source? Googling shows it to be six months old and is really a better write-up on the topic: http://www.eetimes.com/electronics-news/4234459/ARM-customers
  • -9 Hide
    Zingam_Duo , June 11, 2012 4:46 PM
    Unsurprising, I knew it. It is a well known fact that deep inside every modern x86 CPU is a RISC CPU. So I bet these are many tiny little ARM cores that make these Intel Core processors :D 
  • 0 Hide
    classzero , June 11, 2012 4:46 PM
    Intel is ARMing themselves for war!
  • 0 Hide
    webdev511 , June 11, 2012 4:55 PM
    Intel has licensed ARM tech for a long time. Remember the Intel StrongARM processor? I'm not surprised they still have an agreement in place either. Coop-a-tition is pretty much the norm these days.
  • 0 Hide
    eddieroolz , June 11, 2012 5:01 PM
    Interesting. I didn't know Intel licensed ARM big time.
  • 0 Hide
    rantoc , June 11, 2012 5:33 PM
    I'm sure Intels is crying for indirectly pay that when they had a revenue at $43.6 billion!
  • 0 Hide
    joeman99 , June 11, 2012 6:19 PM
    They're paying ARM a leg.
  • 0 Hide
    goodguy713 , June 11, 2012 6:19 PM
    im betting its related to some form of technology patent being used in the processors.. unless were talking amd making arm related products along win intel .. apple has the A5 but if i remember correctly they bought out an arm related company a while back..
  • 4 Hide
    DavidC1 , June 11, 2012 6:27 PM
    That wasn't hard to figure out. They make network processors, and their I/O hubs likely use real small(and real old) ARM chips. It's also likely in the future as Atom goes smaller they might move some of what they use as ARM to their own Atom chips.
  • 4 Hide
    saturnus , June 11, 2012 6:37 PM
    It's hardly surprising news.

    An ARM micro-controller are at the core of practically every SATA II and SATA III interface. Ethernet controllers also require an ARM micro-controller. Both are things Intel produce, so naturally they have to pay license fees.

    No PCs can be made without minimum 2 ARM chips inside, and usually there are many more.
  • 3 Hide
    waethorn , June 11, 2012 6:51 PM
    I think many of you just don't get it. Intel used to make ARM processors: StrongARM and then Xscale. Afterwards, they kept the licensing because of one thing: patent protection. By maintaining licensing with ARM, they were also protected by any kind of patent dispute arising from ARM or its other customers. If ARM produced some new feature in their processor, they couldn't sue Intel for patent reasons if Intel copied it because ARM customers get patent indemnity as long as they continue to pay for licensing fees to use ARM technology. I actually wouldn't be surprised if ARM was also paying Intel for a similar license fee for x86 just so Intel couldn't sue them for some new instruction set patent for SSE or something like that. ARM likely already pays for patent licensing for their graphics design because they would need MPEG licensing through Fraunhofer to cover H.264 acceleration, as well as VC-1 licensing from Microsoft's patent house (VC-1 is part of the Blu-ray spec too).

    These types of contracts are common when you're talking about well-protected engineering and manufacturing secrets.
  • 0 Hide
    BSMonitor , June 11, 2012 8:56 PM
    waethornI think many of you just don't get it. Intel used to make ARM processors: StrongARM and then Xscale. Afterwards, they kept the licensing because of one thing: patent protection. By maintaining licensing with ARM, they were also protected by any kind of patent dispute arising from ARM or its other customers. If ARM produced some new feature in their processor, they couldn't sue Intel for patent reasons if Intel copied it because ARM customers get patent indemnity as long as they continue to pay for licensing fees to use ARM technology. I actually wouldn't be surprised if ARM was also paying Intel for a similar license fee for x86 just so Intel couldn't sue them for some new instruction set patent for SSE or something like that. ARM likely already pays for patent licensing for their graphics design because they would need MPEG licensing through Fraunhofer to cover H.264 acceleration, as well as VC-1 licensing from Microsoft's patent house (VC-1 is part of the Blu-ray spec too).These types of contracts are common when you're talking about well-protected engineering and manufacturing secrets.


    Forget reading the article.... Just know....

    http://www.netronome.com/pages/flow-processors
  • 0 Hide
    Anonymous , June 11, 2012 9:34 PM
    Thanks waethron... great information. I remember Intel being ARM's biggest customer by far years ago and heard they produced more ARM chips than anybody. They got StrongARM from DEC when they bought out DEC's hardware guys and then moved that onto xScale. They even dropped their i960/i860 lines of RISC CPUs.
  • 0 Hide
    invlem , June 12, 2012 1:47 AM
    Kind of like the relationship between Samsung and apple, apple is one of sammy's biggest customers, also their probably the biggest rival in the mobile phone business.
  • 2 Hide
    mihaimm , June 12, 2012 7:46 AM
    Quote:
    This piece originally slipped by under our radar
    Yet that "Apple changes galaxy" didn't...
  • 0 Hide
    hardcore_gamer , June 12, 2012 11:40 AM
    zingam_duoUnsurprising, I knew it. It is a well known fact that deep inside every modern x86 CPU is a RISC CPU. So I bet these are many tiny little ARM cores that make these Intel Core processors


    Not sure if trolling or....
  • 0 Hide
    pkandel , June 12, 2012 11:41 AM
    This report is not only old, it is also wrong. Nomura's Jan 6 report made this nonsensical claim, and they published a revised report on Jan 13 not even listing Intel as a customer. Three companies made up at least 10% of ARM revenue, as ARM itself says, and the Nomura report did not even say who those customers are (though you can probably guess).

    Tom's: a little bit of fact checking goes a long way--publishing it 5 months after a revision is just embarassing. Please update the article and whatever else you have to do to un-mislead people.
  • 0 Hide
    vaughn2k , June 12, 2012 11:57 AM
    as long as a computer use an RISC.
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