Some news came out last week that Google may be working on making their own processors. Reports like this have been around since 2013. For those of us close to the semiconductor industry, this is not a new piece of information. Speculation was that Google may be working on their own silicon designs for smartphones. However, the industry scuttlebutt I’ve been hearing for a few years was Google was exploring designing semiconductors for their own servers. I’ve heard the same about Facebook for what it’s worth.
On paper, this seems somewhat logical. Backend server side computing is becoming increasingly important to the world of computers today and will to an even greater degree in the future. All one needs to do is look at the advantage Apple is creating for itself in designing its own SoC for the iPhone and the iPad to understand the temptation to design silicon for proprietary advantage and, in this case, for Google on the server side of the equation. Google has ambitions to be one of the most powerful cloud computing companies in the world and designing their own silicon makes sense.
The challenge, however, in designing semiconductors is not easy and most companies lack the internal resources and talent to execute. Here is my short list of companies who have tried and true designers and core expertise to create proprietary semiconductor architectures. Intel, Qualcomm, Apple, AMD, Nvidia, and Broadcom. Intel and AMD largely make x86 cores and the others make ARM cores. While there are certainly many names who produce and ship ARM cores, there are only a handful of companies who truly design their own using the ARM instruction set. The names I mentioned are among that list and are the best at it, in my opinion.
When acquiring an ARM architectural license, the kind you need to design your own chips, it is not mandatory to announce to the public a license has been acquired. Google could certainly have one and we would not know about it – yet.
Google may certainly have an ARM core license or an ARM architectural license, but what they do with it is the main question. If designing semiconductors were easy everyone would do it. However, not everyone can.
I’ve long maintained that those who design silicon, and design it well, will play a major role in the future of computing. Thinking about Google following the trend of companies designing their own semiconductors in the hopes it will bring them a proprietary advantage is an interesting thesis. But Google, and many others who do this, would need to acquire the necessary talent to design best-in-class semiconductors. With the consolidation we are seeing, it makes sense Google or someone else could acquire a company like AMD and gain the chip design talent needed. Microsoft also has an architectural license for ARM and I could make a case Microsoft could start making their own chips as well at some time in the future. The main point is, it will have to be acquired. As I think about any number of these companies like Microsoft, Google, Facebook, etc., if we seen an acquisition of semiconductor IP and talent, then it will be quite clear where they are headed and why.
The other area to watch here is China. Last year, the government of China committed to spending 100 billion dollars in 2015, advancing their efforts in proprietary chipset architectures. Huawei, which owns Hi-Silicon, has an ARM architectural license and does make a great deal of its own silicon. They are one of many companies the government would like to see designing silicon for things like PCs, smartphones, tablets, servers, and network equipment both for China and the rest of the world.
Watch what happens here. Trends in the semiconductor space are quite telling directionally about where the industry and particular players are headed.