Amazon has officially entered the semiconductor market with the news that it is selling its own-brand of ARM-based chips to manufacturers.
U.S. tech companies went transatlantic on more than a few occasions last year in their search for innovation, but one of the more curious cases was when Amazon headed to Israel and snapped up Annapurna Labs for a reported $350 million. The chip-design startup was founded in 2011, though it had largely operated in stealth mode in the years since. It was known that Annapurna Labs was working on ARM-based “midrange networking chips for data centers that transmit more data and use less power,” according to reports.
It was also mooted at the time that Amazon planned to move away from Intel’s chips to the lower power-consumption of ARM. And making its own chips would ultimately lead to significant savings over the long term.
Today, we have a much clearer picture of what Amazon has in store for its new line of business, as the first fruits of the Amazon-owned Annapurna Labs have now been revealed: A product line known as “Alpine” will serve as a “foundation for next-generation digital services for the connected home,” according to a press release. Amazon will essentially sell semiconductor chips to original equipment manufacturers (OEMs) and related services providers, possibly covering Wi-Fi routers, streaming devices, home gateways, and Network Attached Storage (NAS) devices. Gary Szilagyi, vice president of Annapurna Labs, explained the thinking behind the Alpine product:
In the fast-growing home application marketplace, new use cases and consumer needs are rapidly invented and adopted,To stay competitive, OEMs and service providers therefore need to quickly add support for the new features that give consumers the ability to enjoy the latest applications without changing hardware or waiting for months to get updated software. Our Alpine platform-on-chip and subsystems product line gives service providers and OEMs a high-performance platform on which they can design hardware that will support growing consumer demands for innovative services, fast connectivity, and many connected devices.
A myriad of modern-day platforms use 32-bit ARMv or 64-bit ARMv architectures, so this venture could prove lucrative for Annapurna and Amazon. The Internet giant already sells one of the leading cloud computing platforms, in the form of Amazon Web Services (AWS); now it’s looking to further embed itself in the fabric of the connected world by offering semiconductor chips.
Market-leading chipmaker Intel can rest easy for now, given that ARM chips have yet to make any significant inroads into the server market, which Intel more or less owns. Annapurna’s chips are currently vying for the many markets that surround it, which general entail low-power devices. A handful of companies, including ASUS, Synology, and Netgear — known for a range of products such as home routers — have already been confirmed as using Annapurna’s chips. As of this week, Annapurna says it’s making the processors available to “other OEMs and service providers.”