The Six Five team discusses Intel’s IFS and Arm collaboration on the 18A.
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Transcript:
Pat Moorhead: Let’s talk Intel IFS, which is Intel Foundry Services, and Arm announced “a multi-generational agreement to enable chip designers to build low-power SOCs on 18A, mobile SOCs first, but opens up the capability for auto IoT data center space and government.”
Daniel Newman: Hey, buddy.
Pat Moorhead: Yes?
Daniel Newman: Do everyone a solid, what is 18A?
Pat Moorhead: I’m going to go into that. 18A is 18 angstrom, a little bit less than two nanometers, but quite frankly, we used to have truth in millimeters, nanometers, and angstroms. It is not actually the width between different transistors. It is just kind of a made up type of thing now, whether it’s five nanometer, and that’s why it was nice that Intel went to that.
But here’s the backdrop to really understand what’s going on here. So you have the majority of leading edge wafers are manufactured in Taiwan. You have China that’s circling gunboats around Taiwan in the spirit of reunification. Rumors out of DC, there’s a plan to blow up TSMC wafer fabs if China attacks. The result that happened, well, all leading edge chips that go into NVIDIA, AMD, Marvell, Qualcomm come to a screeching halt and we go into a giant recession, maybe even a depression. Yeah, I don’t know.
Enter Intel, and its IDM 2.0 strategy. IDM 2.0 was a plan to boost its own internal manufacturing, create a foundry for the third time, and by the way, they’ve signed up NVIDIA, Media Tech, AWS for patch packaging, and a mysterious large CSP, whose name will not be uttered yet. But so that’s the Intel strategy to come in, perfect timing, shores up their own business, but also helps solve some of the geopolitical challenges with the US and Europe.
So let’s break this down. So first off, this is mobile first. Is this to not take on too much or at lower risk? But then again, mobile is the most competitive sector right now, right? What about Arm-based PC processors too? Makes you think. So you have Media Tech, right? You have Apple, you have Qualcomm, but I’d love to see this narrow in to talk about Apple M Series, PC processors and Qualcomm Snapdragon Orion processors as well.
The other thing I said it’s multi-generational. And what that means is nothing more than multiple versions of RMIP. Arm has different instruction sets and generations, but they also different versions of IP, particularly in mobile that they bring out on an annual cadence. Also note US and Europe, not just US. You have Western Europe organizing and wanting its own factories in their own regions as well. One thing I noticed too, Daniel, kind of who was quoted, right? The level of the person being quoted is always important, and in this case it was Intel’s Pat Gelsinger and Arm’s Rene Haas.
Rene Haas actually called Intel a critical foundry partner for our customers, which I thought was huge. So I think this is great news for both Intel and Arm. Arm wouldn’t provide the resources if it didn’t see a chance of IFS success with 18A. That’s the good news. And Arm, while I don’t see Arm getting any more market share, I think they have 99% mobile market share, I could see this as an opportunity in the PC space with Apple and Qualcomm if they are in fact fabbing here to gain PC market share. So that’s it. Big announcement.
Daniel Newman: Yeah, and while 99% sounds like a lot of market share, we can expect the market to get bigger and that is another opportunity that obviously as mobile continues to expand and the opportunities for mobile. You mentioned PC for instance. Well, mobile compute is changing. So Arm’s potential participation in the PC market is going to grow substantially.
And so I think it’s a good alignment for Intel too. Intel has to be thinking about hedging. For a long time it was deeply rooted in x86 or nothing or die. And we’ve seen what happens when you start to see shifts, behaviors away from one particular processor or architecture to another, and the foundry strategy of Intel to be able to manufacture chips for Arm or RISC-V is obviously something that the company can hedge on. If market share of dwindles in any part or x86 architecture loses momentum in certain key markets, they’re able to continue to monetize that strategy.
So I think it’s smart on Intel’s part to be aligned and be diversified. And so with the company making huge bets and huge investments on manufacturing in the US and in other allied nations as the Asia risk continues to heighten despite not much conversation about this, they are well positioned if something was to happen to be the de facto because there’s really no one else to pick up the slack there.
So I think there’s a lot more partnerships with Arm too. I think Arm will continue to be thinking about alignment. The company is in the middle of trying to trying go public. It’s going to be important that the market sees how they’re going to align and compete and how they’re going to participate in the ecosystems. And so I’ve been impressed with Rene Haas as the leader of Arm, and this was a partnership, like you said, that clearly is gaining attention at the very top of the organization with both of the number one leaders of the companies participating. So while it’s a little technical in nature, it’s a big moment. Note it, pay attention to it, watch it. This should be something good so-.
Pat Moorhead: Yeah, so this fills in a lot of the blanks too around the original announcement a couple of years ago, supporting different instruction sets including x86, Arm, and RISC-V.
Author Information
Daniel is the CEO of The Futurum Group. Living his life at the intersection of people and technology, Daniel works with the world’s largest technology brands exploring Digital Transformation and how it is influencing the enterprise.
From the leading edge of AI to global technology policy, Daniel makes the connections between business, people and tech that are required for companies to benefit most from their technology investments. Daniel is a top 5 globally ranked industry analyst and his ideas are regularly cited or shared in television appearances by CNBC, Bloomberg, Wall Street Journal and hundreds of other sites around the world.
A 7x Best-Selling Author including his most recent book “Human/Machine.” Daniel is also a Forbes and MarketWatch (Dow Jones) contributor.
An MBA and Former Graduate Adjunct Faculty, Daniel is an Austin Texas transplant after 40 years in Chicago. His speaking takes him around the world each year as he shares his vision of the role technology will play in our future.
