- Arm could consider selling its own chips
- Details of the proposed change revealed as part of Qualcomm’s victory over Arm
- A change in strategy could be incredibly lucrative for Arm
Semiconductor technology provider Arm, which almost certainly has its hardware in your business smartphone somewhere, is known for helping companies make their own mobile-ready processors, but that could soon change with a discussed shift to manufacturing its own chips .
A report from Reuters discusses Arm’s so-called “Picasso” project; an attempt to increase sales by selling its own chips and competing with its own massive customer base – including Qualcomm and Apple – to whom it normally sells off-the-shelf intellectual property from Arm to help design chips .
Arm may also plan to increase royalty rates for those customers.
Poor vs. Qualcomm in short
Details of the proposed strategy were revealed as part of Qualcomm’s court wins against Arm in a royalty dispute filed and lost by the latter in December 2024.
Nominally this would also include Qualcomm, but Arm’s purchase of the start-up Nuvia, to use its technology to produce its own chips, gradually broke away from the previous agreement, leading to Arm filing a complaint with the US Federal court in Delaware regarding a violation of the license terms.
Ultimately, however, a jury found that Qualcomm’s Nuvia tech chips were properly licensed, ruling that the company could continue to sell them as part of its route into the personal computing and AI sectors.
Arm’s future plans to ‘spray’ its customers
The files in these proceedings, which according to Reuters are still under the court’s seal, show that the ‘Picasso’ plan for Arm to sell its own chips (or even ‘chiplets’) came at the insistence of Rene Haas , CEO of Arm, who, before even taking on that role, had generally described the company’s largest customers as “hosed down” in an internal Teams message sent in December 2021.
Court evidence shows that as early as 2019, Arm executives had discussed raising royalty rates by 300% for their customers using Armv9 – the latest computer architecture, in an effort to boost the company’s smartphone revenue by $1 over the course of 2019 billion to increase. a decade.
Ultimately, it is unclear whether this rate increase will occur or even persist; Using Arm’s computing architecture does not necessarily require the off-the-shelf component blueprints.
And, like Reuters points out that many of Arm’s largest customers-turned-competitors could survive without these blueprints and still design their own parts.