Global technology: No-one can say there’s no ARM in it!
ARM’s products group president Pete Hutton anticipates the day a few years hence when an analyst somewhere in the world congratulates the company for entering the automotive market.
Of course ARM is already in that market and has been for several years – and that is exactly Hutton’s point.
ARM has been in on the ground floor of practically every area of technology innovation you could mention well ahead of the curve – unnoticed and unappreciated by the anaylsts who pontificate whether ARM’s stock is a buy, a sell or a hold.
You will have heard of Silicon Fen and Silicon Valley – ARM executives have created a Silicon Paradise; it is their stock-in-trade. It is why ARM has given Intel a bloody nose, a couple of black eyes and umpteen sleepless nights. And it is why market observers couldn’t have got it more wrong with recent stories saying that the gravy train for ARM shareholders is set to shunt into the sidings because smartphone sales would hit a wall – sending Apple into terminal crisis at a stroke. Apple builds ARM chips into its smartphones, of course.
They clearly didn’t read Cisco’s excellent Visual Networking Index (VNI) Mobile Forecast recently. It projects that 70 per cent of the world’s population will be mobile users in the not-too-distant future.
Cisco points out that since 2000, when the first camera phone was introduced, the number of mobile users has quintupled. By 2020, there will be 5.5 billion mobile users, representing 70 per cent of the global population.
The adoption of mobile devices, increased mobile coverage and demand for mobile content are driving user growth two times faster than the global population over the next five years. This surge of mobile users, smart devices, mobile video and 4G networks will increase mobile data traffic eight-fold over the next five years.
Smart mobile devices and connections are projected to represent 72 per cent of total mobile devices and connections by 2020 – up from 36 per cent in 2015, Cisco adds.
Smart devices are forecast to generate 98 per cent of mobile data traffic by 2020. Smartphones will account for 81 per cent of total mobile traffic by 2020 – up from 76 per cent in 2015.
The proliferation of mobile phones, including ‘phablets’ (a hybrid blend of smartphone and tablet features), is increasing so rapidly that more people will have mobile phones (5.4 billion) than electricity (5.3 billion), running water (3.5 billion) and cars (2.8 billion) by 2020.
Cisco adds that by 2020, Machine2Machine connections will represent 26.4 per cent of mobile-connected devices – up from 7.7 per cent in 2015. ARM is in the vanguard of the Internet of Things movement that will see anything upwards of 50 billion devices connected through M2M.
So if the argument is that ARM is a one-trick pony feeding solely on growth in the mobile industry then it is hardly a starvation diet. Factor in that if Apple declines then one of Intel’s biggest customers, Google, is cosying up to Qualcomm and the duo are apparently supporting a move to processors based on the ARM chip design instead of Intel’s x86 chip architecture.
Now add this little morsel to the menu: as Pete Hutton pointed out after last week’s stunning Q4 results announcement – non-mobile markets accounted for 55 per cent of Q4 processor shipments.
“We’re rolling out new technology plays all the time,” Hutton tells me, “and we have been instigators of technology in the markets analysts think are new to ARM for a number of years.”
The growth in servers, networks and IoT (including healthcare monitoring) each represent rapidly growing vertical markets for ARM but let’s look at an area that is not so obvious – automotive.
So the move to autonomous vehicles will kill the technology in driverless cars? No, it will enhance the technology in cars freed of human influence at the wheel.
The value of silicon alone in cars in 2020 could be as much as $150 in EVERY vehicle. And there are, and will be, a lot of cars on the planet; the total of motor vehicles wheeling away on the world’s roads is already said to be over 1.2 billion.
Hutton argues that the car that drives itself – even parks itself in spaces that would look impossibly tight to a human driver – will require more technology intel not less. The in-car technology bandwagon and the whole IoT movement may not be capable of hitting Japanese express train speeds just yet but they are up and rolling at an impressive rate.
Hutton also reports a massive uptake in ARM technology from startup businesses internationally as a number of its offerings capture the imagination.
The company is already big in China and set to get a lot more powerful there after September’s launch of a Beijing accelerator that will help startup entrepreneurs produce more wearable devices, robots and smart home products, for example, through advice on product design and which chips or software to utilise at the core. Much of it will be built round ARM’s mbed platform and five similar ventures across China are due to be opened.
Hutton adds that in broader terms ARM has developed an enviable global ecosystem of partners which is proving a financially and intellectually reward ing two-way highway of innovation development.
“It’s about 50-50 – ARM generating ideas and taking them to partners and partners bringing concepts to us and seeking our expertise to develop them. It is certainly a healthy dialogue and one that helps to underpin continuous innovation in the many technology areas in which ARM is influential.”
OK, so forgetting all of the above, PLUS the massive worldwide recruitment of R & D engineers PLUS the new headquarters being built in Cambridge, ARM clearly has a major problem – how to contain its excitement!