In the early 80’s of the last century, computing came out of the hands of geeks and nerds and got democratised. IBM spearheaded the initiative of PCs with two unruly kids, Microsoft and Intel, with the OS and CPU coming from them. Many clones and compatibles came into being and Personal Computers never looked back.
Moors law [the number of transistors
in an Integrated Circuit (IC) doubles every two years] guided the raw computing
power of Intel CPU. To match with it, Microsoft went into GUI, with landmark avatar
of its OS, the ‘Windows’.
IT matured into ICT (Information
and communication Technology) and computers & phones merged, and in its evolution,
smartphones of today combined the power of a mainframe computers of 2 decades
back and the satellite phone.
Though Intel & Microsoft, the
computer-less computer companies thrived, on the smartphone space both couldn’t
make an impact. The Android and IOS became the de-facto OS standards and many
CPU makers came into existence for smartphones. However one semiconductor
technology company that chose its own path as the CPU of smartphones, M/s. ARM Holding which today has more than 250 mobile tech companies including Apple,
using its CPU.
ARM started as a UK based
company by the name, Acorn in the 1980s. Unlike Intel, this semiconductor
design company leveraged on the principles of Reduced Instruction Set Computing
(RISC). Compared to the powerful Intel CPUs, Acorn processors are less powerful
but are very fast with an added advantage of having very less power consumption. After
Steve Job’s second coming to Apple, the Apple Company combined with Acorn to
derive into a new company, Acorn RISC Machine (ARM) Inc., with Apple owning 43%
in it.
ARM processors gave a shot in the
arm for Apple. Initially its Newton message pad, and later IPod, IPad and then
IPhone used ARM processors as their CPU. There are wonderful stories of how ARM
had helped Apple to grow. At first it was in 1999, when Apple sold 15% of ARM
stock to get $1.1 Billion at a time it was doing badly, which helped Apple reinvigorate.
Secondly Apple decided to do way with Intel processors for its devices in
favour of ARM processors, thereby cutting down cost drastically and with ARM
CPU, Apple went on to be a technology & innovation leader, skyrocketing its
market capital into the Trillion dollar bracket.
By 2012 ARM was bought over by
Softbank, the PE Company of Masayoshi Son, thus becoming a Japanese company.
ARM’s business model is not into chip manufacturing bur designing and selling licenses
to others to make and use it. It’s Revenues for the year 2020 was $1.5 billion
with Profits hovering above $500 million, having assets worth $3.2 Billion.
Though more than 20 billion ARM CPUs had been made so far, the company’s revenue looks
small because it is not into manufacturing but in licensing of technologies.
On 13th September 2020, it was announced that NVidia Corp. will buy ARM holding from Softbank for $40 Billion. NVidia is a globally successful Graphic Processor Unit manufacturer with a revenue of $11 Billion and a profit of close to $3 Billion.
The coming together of two semiconductor companies will go a long
way into the thriving technology market, assisted by 5G and with IOT making a huge impact.
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