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Microsoft's In-House Processor Could Spell Trouble For Intel

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Bloomberg today reported that Microsoft is working on designing their own in-house processor. Microsoft’s in-house processor will be used in server computers that run Microsoft’s cloud services. Microsoft follows what the rest of the industry is appearing to do. That is to reduce reliance on using Intel chip technology.

Microsoft is without a doubt the world’s largest software maker. As such they are looking to use ARM-based technology to create their in-house processor. According to people with knowledge of the situation, Microsoft’s in-house processor will be used in data centers. Microsoft is also considering creating another processor solely to power the Surface family.

Microsoft primarily uses Intel processors in many of its products including for Azure cloud services. So working on creating its own custom processor isn’t too wild of an idea. The company has previously worked with both Qualcomm and AMD to create custom chips for the Surface Laptop 3 and Surface Pro X.

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Microsoft isn’t a stranger to ARM-based Processors

With the Surface Pro X Microsoft worked with AMD to create the ARM-based SQ1 processor. A few months ago, the SQ2 was released. Microsoft’s decision to move to ARM-based technology for its servers is a really big change. Intel could be in trouble now that Microsoft is also considering a switch to ARM-based chips. As Apple, another major software and hardware maker, has already done the same.

Apple began moving away from Intel when it mentioned the creation of its own custom M1 chip which powers the new MacBook Air and MacBook Pro. It has also apparently been looking to move away from Intel for a while.

The company’s M1 chip has proven that Apple’s move to ARM-based technology has its benefits. The chip has been reviewed and a lot of those reviewers are happy with its performance and battery life. Another advantage of the M1 chip is that its integration with Apple’s software is nearly perfect.

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Apple has always had a history of having excellent harmony between its hardware and software. As a result, many OEMs have looked to replicate this same type of integration. With Microsoft now exploring the possibility of creating its own custom processor, it could also achieve this perfect harmony.

This does not bode well for Intel. As Apple and Microsoft are big players in the computing world. Usually, when one does something, others tend to follow. Now that both are looking to continue distancing themselves from Intel, other companies may follow suit.