In the modern world, technology innovations are like apple pie: everyone likes them and wants to have them. That is why, it seems nearly impossible to be one of the most successful tech companies on the planet and not to get into the public eye.
A large cluster of science and technology-based companies focusing on software, biotechnology, and electronics in and around of Cambridge contains about 1,500 corporations, some of which are the fastest-growing market leaders in and outside the United Kingdom. You have probably never heard about the British corporation ARM (Advanced RISC Machines)—the so-called “Silicon Fen” company that designs processors (CPUs) and other software development tools under the DS-5, Keli, and RealView brands. In fact, the processors based on the designs licensed from ARM are used in the chips of all classes of smartphones, including Apple, Nokia, HTC, and Sony Ericsson.
History of Success
The story goes back to 1978, a time long before the smartphone was invented.
That was the year when Acorn Computers was founded in Cambridge. Acorn has risen as a small start-up out of a large number of other similar companies offering microcomputers in the UK. So, it was a quite standard example of that time. Acorn’s first product—the Acorn System 1—included only a LED display, a keypad, and a cassette interface (the circuitry to the left of the keypad). The microcomputer was selling for £80 ($120) and aimed at the British educational market.
During the mid-80s, almost every British school was equipped with Acorn’s Micro Computers. Such a breakthrough became possible in the wave of anticipation of the coming microcomputer revolution after the firm was chosen by the British Broadcasting Company for the BBC Computer Literacy Project. The Acorn team was working through the night (an early form of hackathon) on a prototype called Proton to match the BBC’s specification: it should be a machine to accompany a television series aimed at increasing computer literacy across the country. Acorn’s Proton computer was re-branded as the BBC Micro and released in December that year making it clear to all that Acorn Computers would become a big player in the informational world in the near future.
The next crucial step toward great success was the invention of a processor designed in under a year by two post-graduate students from Berkeley, David Patterson and Carlo Sequin. The official Acorn RISC (reduced instruction set computing) Machine project had started in October 1983. The computer with a sleeker design and a new, more efficient a new type of processor was called the Acron RISC Machine, or ARM.
Acorn & Apple
In 1990 the company formed a partnership with Apple: the newborn company, also called ARM, aimed to design a processor for Apple’s Newton handheld computer. Designing low-power processors, ARM went from strength to strength. Today, almost every smartphone on the market uses an ARM-designed chip. Modern PCs, smartphones, and other portable devices mostly use ARMv7 CPUs.
If we look at the history of ARM, it has been focused on mobility and low power – that is the company’s heritage, says the ARM’s head of strategic marketing Laurence Bryant. According to him, the company’s success will continue in that vein.
ARM head of brand marketing Ed Gemmell thinks that while providing the best mobile technologies for partners, the company gives full freedom of actions in terms of what to do with processors. He says that Intel, for example, leaves very little to the PC manufacturer. That is why the innovation process will slow.
ARM created a unique way of working: it does a highly specialized job—lays out the central processing unit—and hands the designs over to the third parties. Most of the companies take the design as it is, but some, like Apple, pay extra for the ability to remake the design as they see fit. ARM is also one of those few companies that competitors trust with their trade secrets.
The key to the company’s finance success is that it gets paid several times for the same work: the chip layouts can be reused in different situations. The numbers speak for themselves: in 2014, half of ARM’s income came from five-year-old designs.
The company’s goal for 2015 is to have ARM-based processors in most of the tablets, mini-notebooks and other mobile PCs sold. Even more ambitiously, the company’s internet of things department aims to dominate the chips that run homes of the future.