The Arm-based Market Heats Up & Investment Opportunities Abound

Two notable semiconductor technology companies to keep an eye on are Marvell Technology Group, LTD (NASDAQ: MRVL) based in California, Texas, and China and a leader in ARM-based CPU’s that are used in servers employed for cloud-computing. Smooth Stone is based in Austin, Texas and is focused on producing ARM CPU’s used also in servers for cloud-computing.

Marvell Technology Group, LTD and its semiconductor company, Marvell Semiconductor, Inc. make ARM-based, low-powered chip for eReaders, Smartphones, Mobile Internet Devices (MID’s), Digital Photo Frames, Open RD (an open-source technology platform), Dual-Band Access Point (802.11n wi-fi with multiple antennas), and Plug Computers (low-powered computers that are always on, such as set-top Internet boxes).

Smooth Stone has the industry support of ATIC (Advance Technology Investment Company. ATIC is the same company that came to the rescue of AMD (Advanced Micro Devices, Inc) (NYSE: AMD) when they were in dire straits.

What Smooth Stone and Marvell Semiconductor, Inc. hope to do is to bring greater energy efficiency and computing density to the data industry. In the data industry and most notable in the server sector, energy efficiency is the key to containing costs and improving the bottom line.

Technology advances has taken care of most of the hardware issues involving computing power, but the need to keep energy cost at bay has been a challenge for the data industry. Any technology that addresses the energy concerns will be sincerely welcomed.

ARM processors are generally found embedded in smartphones, but the Next-Generation Internet demands an even more social Internet and that means Social Media will demand more interaction and video online and these demands from the Internet users will only put additional strains on energy efficiencies. The data centers that can provide for the needs of the Next-Generation Internet will do well and those data centers that struggle with energy concerns, may find there days numbered.

The adoption of the low-powered, ARM CPU’s are a certain game-changer for the data industry and the server sector in particular. Most data centers use Intel or AMD CPU’s that are high-powered, Xeon or Opteron (codename: Magny-Cours) processors to render server functions when they could be using a low-powered, ARM CPU to do simple page loading and reduce their electrical consumption and space requirements by up to 75%. Intel owns about 90% of the server chip market and has the Atom processor which are also low-powered and can be used also in servers.

Overwhelmingly, data centers compete with one another based on performance and few data centers are willing to give up performance even if it cost them more in energy costs. Most data centers would rather cut costs on something else than sacrifice performance. Some data centers have adopted instead of using hard drives, have opted for DRAM or Flash memory for their storage needs which help to boost performance, although are more expensive to implement. If, Marvell, Smooth Stone can do what they say, they can license their technology to Intel and AMD for full-scale production.