Intel to work with Arm on chip manufacturing compatibility

By Stephen Nellis

(Reuters) – Intel Corp on Wednesday said its chip contract manufacturing division will work with U.K.-based chip designer Arm Ltd to ensure that mobile phone chips and other products that use Arm’s technology can be made in Intel’s factories.

Once the biggest name in chips known as central processing units (CPUs), Intel has seen long seen its technological manufacturing edge blunted by rivals such as Taiwan Semiconductor Manufacturing Co Ltd (TSMC), the world leader in making chips for customers such as Apple Inc.

Intel’s turnaround strategy hinges in part on opening up its factories to other chip companies, particularly those in mobile phones. It has said firms such as Qualcomm Inc are planning to use its factories for future chip designs.

“There is growing demand for computing power driven by the digitization of everything, but until now … customers have had limited options for designing around the most advanced mobile technology,” Pat Gelsinger, Intel’s chief executive, said in a statement.

For its part, Arm, owned by Japanese technology investor SoftBank Group Corp and which plans to go public later this year, is a major supplier of intellectual property to many chip companies, especially in mobile phones. Arm has partnerships with major chip contract manufacturers in place to ensure that its designs will work well on their manufacturing processes.

The partnership announced Wednesday is aimed at putting Intel on equal footing with TSMC and South Korea’s Samsung Electronics Co Ltd, the two companies that currently manufacture most of the world’s chips for mobile phones.

(Reporting by Stephen Nellis in San Francisco; Editing by Christopher Cushing)