Qualcomm Leaves Centriq 2400 Server Chip to the Chinese

According to a report by The Information, Qualcomm has all but eliminated its server chip division, cutting its workforce from about 1,000 employees earlier this year to only 50. The division was in charge of building the 48-core Centriq 2400 processor, which Qualcomm launched in 2017 on the 10nm process.

Qualcomm hasn’t officially announced the shutting down of its Centriq division, but if the company is indeed cutting its server chip division by 95 percent, as per The Information's report, then it has effectively left the server chip business.

At the end of 2016, announced the Centriq 2400. A few months later, it announced its first major cloud services customer intending to use this processor: Microsoft. Qualcomm’s Centriq 2400 was meant to shake-up the data center industry and launch Arm chip makers’ assault on Intel’s dominance.

However, in June 2017, AMD revealed its own server processor, EPYC, which also offered very good value and made Qualcomm’s chip look less appealing as they originally were when compared to Intel’s server chip offerings. 

Furthermore, Qualcomm has been embroiled in antitrust lawsuits in the past couple of years and has had to pay billion-dollar fines, and its NXP acquisition was cancelled, which forced the company to cut another $1 billion dollar in costs and lay off 1,200 employees.

These are all reasons for Qualcomm to rethink priorities and competing in the server chip market. On the consumer side, last week the company announced its “most extreme Snapdragon” platform yet, the Snapdragon 8cx, which promises to compete against Intel’s Core i5 in the notebook market.

Chinese Joint Venture Will Build Qualcomm’s Centriq Chip

Qualcomm’s Centriq IP will continue to live under the Thang Long 4800 brand name used by HXT, a joint venture set up between the Chinese Guizhou Province and Qualcomm, with 55 percent of the joint venture owned by the Guizhou Province.

The Thang Long 4800 seems to be almost identical to the Centriq 2400, with one exception. The chip uses a different encryption module that aims to comply with China’s encryption regulations, as per the company's statement:

"... the Thang Long 4800 integrates a cryptographic module that complies with the Chinese commercial cryptographic algorithm standard, and combines a secure and controllable infrastructure to provide chip-level technology implementation for information security of the application system."

In other words, the module likely allows the Chinese government to intercept or decrypt encrypted communications passing through these servers at will.