Chip designer Arm, which is owned by SoftBank Group Corp, released new technology for mobile devices on Monday. MediaTek Inc, which makes chips for smartphones in Taiwan, said it will use the new technology in its next-generation product. MediaTek has been making chips for low-end and mid-range smartphones for a long time. Recently, it has been trying to get into the market for high-end smartphones, which was once dominated by Qualcomm Inc., which has been in a legal battle with Arm over chip licensing agreements since last year.
MediaTek said in Arm’s blog post about the new products that the new chips will help make its next-generation smartphones run better. SoftBank’s shares closed up 8.2% in Tokyo, which was the biggest gain in more than a year. CEO Masayoshi Son is focused on getting Arm listed. Shares of MediaTek went up 1.1%. Masahiro Ichikawa, chief market strategist at Sumitomo Mitsui DS Asset Management, said, “Investors are very interested in any news about AI or chip technology, and they jumped on this Arm news.”
Arm sells chip designers the plans they need to make their own hardware. At Taiwan’s Computex conference, it will show off the Immortalis-G720, a chip for video image processing and AI applications, and the Cortex-X4, a processor that would be the brain of a mobile device. Arm said that both of the new chips are 15% faster than their predecessors. The Cortex-X4 also uses 40% less power, which is important for smartphones that need to keep their batteries going for a long time.
Arm also said that it had “taped out” the Cortex-X4 at Taiwan Semiconductor Manufacturing Co. This means that it had a chip made at the factory, which is an expensive process that is usually done by chip designers who sell the final chip.
When asked Chris Bergey, the general manager of Arm’s Client Line of Business, if the tape out meant that Arm was making a chip to sell instead of its longtime business model of giving the blueprint to chip makers. Bergey said that this is a step Arm sometimes takes to help customers test out new manufacturing technology.
“Arm doesn’t make money by selling chips. “We don’t do that,” he said. The Financial Times said last month that Arm was making its own chip to show what its designs could do. Arm said that the Cortex-X4 was built using TSMC’s N3E process, which was a first for the industry.