UK-based semiconductor design company Arm is reportedly looking to team up with manufacturing partners to develop its own prototype semiconductor, targeted for use in mobile devices, laptops and other electronics.
The prototype chips are meant to showcase advances that the company is making, in an attempt to increase the company’s value and attract new customers ahead of its expected IPO later this year, according to a report in the Financial Times, citing multiple sources at the company
Arm has created a new solutions engineering team to lead the development of the new prototype chips, according to the report. The team will be headed up by Kevork Kechichian, who joined Arm in February and who previously oversaw the development of the Snapdragon chip at Qualcomm.
The team will also work on improving the performance and security of Arm’s existing designs, according to the Financial Times report, which cited industry executives who described the new, prototype chip as “more advanced” than ever before.
The prototype chips are not meant to be sold directly to device manufacturers, sources told the Financial Times —doing so would mark a departure from the company’s traditional way of doing business.
If Arm were to change course to produce its own chips and sell them directly to device makers, it would change its position in the semiconductor industry. Up to now, Arm has licensed or sold its chip designs to manufacturers, rather than getting involving directly itself in the production process, and so has remained something of a neutral party in the semiconductor industry. Its products are found in more than 95% of smartphones.
Recently though, it has appeared that Arm is working more closely with manufacturers as a way of helping to ensure the market for its designs stays strong. Earlier this month, for example, Arm struck a deal with Intel to ensure semiconductors that use Arm’s upcoming designs can be made in Intel’s factories.
The efforts to work more closely with manufacturers is happening as Arm, currently majority-owned by SoftBank, prepares to launch an IPO. The company announced it would launch an IPO last year, after a proposed deal to be acquired by Nvidia collapsed in the wake of concerns by regulators, and more recently said the IPO would take place in the US. Arm is likely to file registration documents for its IPO with the US Secuirties and Exchange Commission soon, according to media reports.
Chip trade war continues to heat up
Arm’s moves to bolster ties to manufacturers also come at a time when geopolitical turmoil is disrupting the global chip market, causing companies to look for ways to bolster the security and continuity of the semiconductor supply chain.
The presidential administrations of both Joe Biden and Donald Trump, citing trade and security concerns, passed measures barring the use of the use of Chinese-made hardware in US networks and imposed export controls on US computing technology — most recently, restrictions on chips and chip-making equipment. The US has also put pressure on its allies to enact similar restrictions.
In the latest chapter of the ongoing US-China semiconductor trade war, the US has asked South Korea not to fill the market gap that would be left if Beijing follows through on its threat to ban the US-based memory chip maker Micron’s products, the Financial Times additionally reported.
On March 31, the Chinese government issued a statement that said a review of Micron is being undertaken “in order to ensure the security of the key information infrastructure supply chain, prevent network security risks caused by hidden product problems, and maintain national security,” according to a machine translation of the announcement.
In statement published earlier this month, Micron said that the company is aware of the Chinese government’s investigation and that it plans to cooperate fully.