Processor giant wants to lift the tide: Will ARM acquire AMD?

The rumors of the acquisition of ARM by Intel, Apple, etc. in the industry last year have been absent. Nowadays, "The Great Change of the World", ARM actually turned to buy AMD.

A few days ago, ARM CEO Warren East said in the earnings report that the board of directors and shareholders have long wanted to buy AMD. Because the latter is currently reassessing the strategy, the opportunity is greatly increased at the moment.

It must be ridiculed three years ago. Because, at the time, ARM and AMD were in the communications market, one who was in the PC field and who didn't buy anyone.

Is WarrenEast an opportunity to tell investors stories? You know, ARM's share price has soared over the past month or so.

The author believes that ARM may not be able to buy AMD. When people criticize Intel's mobile Internet strategy for being stuck in the processor power consumption problem, they may be over-optimistic about the current advantages of ARM's mobile Internet. Or, his words, in disguised form conveys a sense of crisis in ARM. In the face of strong enemies such as Intel and MIPS, it cannot wait for its opponents to break through the barriers of low power consumption and must develop new outlets as soon as possible.

In the past few years, ARM has made vertical integration in physical IP, tools, etc., but it does not show advantages in terms of 64-bit processor technology and high clock speed. At present, it lacks more support from mainstream operating system Microsoft.

These are AMD's strengths. Although AMD has been suppressed by Intel for a long time, it is the greatest check and balance force in the PC industry chain. The industry even believes that the reason behind AMD's lagging behind Intel is not due to technology, but business and operational ineffectiveness.

If ARM can buy AMD, it can not only control the mobile phone and tablet industry chain, but also penetrate at least 20% to 30% of the PC market, which is equivalent to that of taking the industry upstream.

But this reasonable business logic is not feasible. The industry has the view that the main reason may be insufficient financial resources. ARM's annual revenue is only about 600 million U.S. dollars. It belongs to "small and beautiful" companies, and AMD is a big man. However, I believe that the above ARM acquisition of AMD is not feasible financial issues - according to ARM status, it is not difficult to obtain financial leverage - and the most important is the respective model: ARM as a licensing model, the architecture and patent rights to deal with many to deal with While designing companies, Intel designed its own processors; ARM’s acquisition of AMD is equal to fighting with its former partners. On the other hand, the AMD architecture comes from Intel, and the patent right is naturally in the hands of Intel. ARM's acquisition of AMD is equal to working for Intel.

Last year, I analyzed that Intel’s acquisition of ARM was not feasible, and the reasons were similar. If it does, many of the processor companies that live in the ARM licensing model will face life and death - unless Intel changes its business model to open licensing, but in the short term there is hardly any hope. Up to now, there are only 4 Intel-based processor companies.

Is there no alternative cooperation opportunity between ARM and AMD? Of course there is, and it will also make Intel nervous. That is AMD's initiative to use Intel architecture and purchase ARM licenses. The former is used to crack down on the Intel PC industry, which is used to expand the smartphone and tablet market. As AMD has dilute the manufacturing industry in 2009, it has abandoned the IDM model similar to Intel, which does not hinder the existing operating model.

Therefore, I believe that it is not so much an acquisition as cooperation and integration. Not long ago, AMD has already announced or will purchase an ARM license to expand the tablet market. In fact, AMD's display processors already have ARM technology.

If the "A+AMD" dual-A cooperation becomes a reality and goes deeper, with AMD's processor design power, Microsoft-based solutions, and the PC industry chain, it is expected to rapidly form a core force that will truly subvert the mobile phone and PC industry. In fact, Intel has taken similar actions. Last year it acquired Infineon’s wireless business, and the latter’s core product is based on the ARM architecture.

Probably someone will ask, Apple iPad has been amazing in the blend of cell phone and PC, what is worth waiting for? That is just a transitional form, in which the processor is based on the ARM architecture and even Apple itself admits that it is not the ideal product. It seems that a real era of industrial integration has not arrived yet. When the time comes, who will win will depend on who can now integrate the resources of the opposing camp faster.