There was a time when if it wasn’t “Intel inside,” it didn’t matter. That time is gone, however, and there are new generations of processors that have nothing of Intel on the inside. These are the next level of semiconductors and they’re built for phones, IoT devices, and AI research. These chips being produced by the likes of Samsung Electronics, Nvidia, and Qualcomm are so much more relevant to current requirements of emerging technologies, a concept that seems to be lost on Intel, the former undisputed champion of the chip wars.
A new king is crowned in the chip wars
The reason we’re saying former here is because according to Samsung’s quarterly earnings, it has just ended Intel’s 25-year reign as the No. 1 chipmaker in the world with both higher revenues and profits in the second quarter of 2017. There was actually a time when Intel chips ruled, or if you were adventurous you might try an AMD. But nobody ever expected a South Korean electronics manufacturer to be the one to oust Intel from its top spot.
AMD, meanwhile, is actually a lot more relevant today with regards to GPUs. The fact is it may even be winning the “megahertz war” against Intel, but more on that later. The point to think about here is Samsung doesn’t make chips for laptops or computers or even servers, for that matter. They’ve beaten Intel purely on flexibility and foresight and the fact that they make processors for next-generation devices.
Missing out on the mobile wars
With regards to mobile phone technology, it’s really not like Intel is losing the chip wars — Intel is missing this new front in the chip wars. Nobody ever sees a phone that runs on an Intel chip and no one even would go looking for one, for that matter. While Intel seemed to think that mobiles were phones and laptops were computers, the world changed and you can do almost everything or more on a phone or a tablet than you could with a laptop or a computer. Even with regards to laptops, the premium brand is Apple — yes there are thousands of cheap laptops with Intel on the inside — but anyone who can afford it buys a MacBook Pro or an AirBook or something on that level.
While companies like Nvidia and Qualcomm are slugging it out in burgeoning industries like cloud computing and AI, Intel seems to have completely lost the plot and is still focusing on further development for PCs and laptops.
Yes, PCs and laptops are still used in a big way in the enterprise. But with ARM chip technology and the lower physical requirements of new software technology like containers and microservices, more powerful processors for computers is not the need of the hour. Additionally, as more companies move their software and hardware to the cloud, users prefer ARM processors as they’re cheaper and require less power to run compared to Intel. As far as servers go, the trend is toward lots of cheap replaceable servers, and that’s why a lot of server manufacturers are either making or planning to make their own ARM chips now.
Microsoft announced in March that it was teaming up with Qualcomm to begin using ARM chips in its servers. Jason Zander, vice president of Microsoft’s Azure cloud division, said in an interview with Bloomberg News that they had even created a Windows operating system for servers that run on ARM’s processors.
Additionally, Google is also getting into the semiconductor manufacturing game and has developed an innovative chip called a Tensor Processing Unit (TPU), which could put further pressure on the former champion. Apparently these “TPUs” have already outperformed chips from Nvidia and Intel on AI and machine-learning tasks. What makes them more efficient is the fact that they’re designed to perform specific functions, a lot on the lines of GPUs but more specific.
David Patterson, an engineer at Google, was quoted as saying, “Instead of the Honda for everyone, we are making these Formula One race cars for some things.” What he obviously means here is that instead of a jack-of-all-trades processor, they are making a master of one. He also said, “We threw out a lot of stuff that was not needed,” these stripped down process specific chips seem to be a growing trend as opposed to powerful multipurpose silicon. Additionally, the TPU is supposed to have about 3.5 times as much memory as a similar one from Intel.
AI is one department where process-specific chips have taken off, and the story of how GPUs were used for the first time for AI research is legendary. Graphics chips companies like Nvidia have taken center stage overnight and are now developing chips specifically for AI. All the big cloud giants just can’t wait to get their AI offerings out fast enough and this is going to need lots of the new semiconductors. How does a company on top of its game almost since the beginning of computing just lose its way in such a big way? Could it be overconfidence or just being out of touch with what’s going on in the real world today?
While all the “major chip” companies are going after this market with a gusto, Intel looks like it’s doing a Robert Baratheon from “Game of Thrones” and seems to have just lost interest in being King anymore. Nvidia, however, is emerging as a clear leader in the field of AI and recently launched the Tesla V100 graphic chips. The V100s run on its new graphic processing architecture called Volta and was announced during the recent Conference on Computer Vision and Pattern Recognition in Hawaii.
Google has always been a forward thinker, and the impact AI is going to have in the automotive market, airlines, customer service industry, and almost every aspect of human life in the near future is mind boggling.
The megahertz war
Intel’s new Core i9 CPU has just been released, but it still seems to be fighting the old chip wars with AMD. So if this is where Intel is concentrating all its energy, something is definitely not right.
Additionally, the current stock of CPUs from both companies have been boasting rather modest clock speeds for a while now, and the latest 2.9Ghz from Intel could very well indicate that they’ve reached a ceiling as to how far they can actually push one particular piece of technology. There are definitely people watching and drooling over Core i9s and Ryzens, but there are a lot more people interested in the next iPhone or Samsung. The enterprise is full of stories about companies that just fail to realize change until it’s too late, and Intel definitely looks like it’s going down that road. We’ve also seen companies like Microsoft, however, that completely turned it around at the last minute, so we hope Intel can do the same in the chip wars it used to win so handedly.