Arm Plans AI Chips Launch in 2025 with SoftBank Backing

04-06-2024 | By Robin Mitchell

SoftBank's Arm is gearing up to enter the AI chip market, with plans to launch its own AI chips by next year. This move comes as the competition in the AI chip sector intensifies, with Arm aiming to develop a prototype by Spring 2025 and commence mass production by Autumn of the same year. With SoftBank Group heavily investing in this venture and partnering with key contractors like Taiwan's TSMC, the stage is set for Arm to make a significant impact in the AI chip domain. What challenges has ARM faced over the past few years with regard to its business and an attempted takeover by NVIDIA, what exactly will ARM be planning to do with AI chips, and how could such a move help propel ARM devices in the field of AI?

  • ARM has faced challenges in maintaining its independence and navigating financial struggles amidst attempted takeovers and regulatory concerns.
  • ARM launching its own AI chips by 2025 will boost the UK semiconductor industry and potentially open up new markets for AI hardware.
  • Arm's upcoming AI chips will transform AI computing, democratise access to AI technology, and promote inclusivity and diversity in the tech industry, driving innovation and technological progress.

Challenges Faced by ARM: Business Struggles and the Attempted

When considering the history of ARM, its significance in the industry, and the current semiconductor landscape, it is clear that ARM has faced numerous obstacles in recent years. From its humble beginnings as a University of Cambridge project to its acquisition by SoftBank for $32 billion in 2016, ARM has transformed the semiconductor industry with its intellectual property and core designs. ARM's patented microarchitecture and instruction set have been licensed into billions of devices worldwide, making it a key player in almost every sector, from the most basic microcontrollers to the most complex data centres.

As a result of cunning market strategies and core offerings, ARM has been able to establish itself as a major player thanks to its fair licensing model that charges all customers the same rate regardless of their size or production volume. This lack of discrimination has earned ARM the reputation of being the Switzerland of the semiconductor industry, neutral and unaffected by the politics and feuds of larger companies. 

However, this neutrality has also made ARM a target for larger companies looking to expand their market reach and control. One such company, NVIDIA, saw an opportunity in ARM and launched a $40 billion takeover bid in September 2020. While NVIDIA and ARM stated that the acquisition would not affect ARMs neutrality, the rest of the industry was quick to object to the takeover, fearing that NVIDIA would manipulate ARM to work in its best interest.

NVIDIA's Takeover Attempt and Regulatory Challenges

Regulatory bodies around the world also threw cold water on the deal, raising concerns about national security and competition. In the endNVIDIA walked away from the deal, leaving ARM to continue its path as an independent semiconductor IP vendor. While ARM has managed to avoid the clutches of NVIDIA, it is still facing financial struggles and has considered going public via an IPO to raise more funds.

The ongoing semiconductor trade war between the West and China has also affected ARM's business, with ARM China reducing staff by 14%. The main branch of ARM has already removed 40% of staff introduced by ARM's former owner, SoftBank, demonstrating the financial challenges faced by ARM. Overall, ARM still faces a multitude of challenges as it looks to secure its position in the semiconductor industry, whether it is raising funds, fending off potential suitors, or Fending off competition from other technology companies.

ARM's AI Chip Strategy

Recently, the UK semiconductor industry has been given a potentially major boost thanks to the announcement that ARM will be launching its own range of AI chips by 2025. While the physical chips will be manufactured by third-parties, ARM will design the architecture and sell the chips to customers. This move is a result of SoftBank's efforts to create a next-generation AI technology platform called GenAI and the setup of an AI computing infrastructure with a total investment of $960m by 2025. Moreover, Arm Holdings, supported by SoftBank, aims to carve out a significant niche in the AI chip market by establishing a dedicated AI chip division. This initiative aligns with broader industry trends where major tech companies are developing their proprietary chips to enhance performance and reduce dependency on external suppliers. According to a recent report by Nikkei Asia, Arm plans to launch its AI chips by 2025, with prototypes expected as early as spring that year. The move is set to potentially revolutionise the AI hardware landscape in the UK and beyond.

Potential Benefits for the UK Semiconductor Industry

While the exact details behind the power of the new AI chips are yet to be released, it is expected that they will be highly beneficial to the UK semiconductor industry. With AI rapidly growing in popularity, having access to specialist AI chips will help semiconductor manufacturers create cutting-edge products. Additionally, the UK government has been pushing to increase the use of AI in everyday life through the adoption of public sector AI, thus providing a large potential market for the new ARM AI chips.

This strategic initiative by Arm is backed by significant financial investment, with development costs anticipated to run into hundreds of billions of yen. SoftBank is not only supporting Arm financially but is also involved in negotiations with Taiwan Semiconductor Manufacturing Corp (TSMC) to secure manufacturing capacity. This collaboration is expected to ensure that Arm's AI chips are produced efficiently and at scale, ready to meet the burgeoning demands of AI-driven applications.

Industry and Government Support

The UK semiconductor industry has already shown its support for AI technology, with numerous companies working on everything from AI hardware to software algorithms. With the launch of these new AI chips, that industry is likely to see substantial growth and could even see new companies emerge that will focus solely on the development of AI hardware.

In addition to enhancing AI capabilities, these new chips are expected to provide significant competitive advantages in data-centre operations. By developing and deploying these advanced AI chips, Arm aims to tap into the data-centre market, where the need for high-performance and energy-efficient processors is paramount. This move is particularly timely as companies seek alternatives to Nvidia's dominant position in AI chip technology.

Furthermore, the UK government may be persuaded to launch new funding schemes to help semiconductor companies access the latest technology. While there is no evidence to suggest that the government will launch a funding scheme, it has launched numerous initiatives over the past few years to help semiconductor companies, including the National AI Strategy and the Data Protection and Digital Information System.

Thus, the launch of the new ARM AI chips will be beneficial to the UK semiconductor industryand could even open the UK to a whole new market of AI hardware. If the UK government is wise, it will launch new funding schemes to help semiconductor companies access the latest technology so that the UK remains competitive with other nations.

Leveraging ARM Architecture for AI Advancements

As the world becomes increasingly more dependent on technology, the demand for devices that can provide cutting-edge AI capabilities is skyrocketing. With its announcement to launch AI chips by 2025, SoftBank's Arm is set to transform the field of AI by enhancing the capabilities of Arm devices. By offering a cost-effective alternative to NVIDIA and other established players in the AI chip market, Arm is strategically positioning itself to tap into a vast and growing market, empowering engineers to unlock new possibilities in AI-driven applications.

However, the significance of Arm's AI chips extends beyond the engineering community, with far-reaching implications for the broader electronics industry and the pace of innovation in AI-driven devices. By offering a performance-optimised and cost-effective solution, Arm is democratising AI computing, making it more accessible to a wider audience of developers, startups, and small businesses. This democratisation of AI will catalyze innovation, spurring the creation of cutting-edge products and services that harness the power of AI technology.

Furthermore, Arm's AI chips have the potential to empower underrepresented communities in the technology sector, such as women-led startups and small businesses, to develop game-changing AI solutions. By levelling the playing field and providing a platform for diverse innovators to showcase their ideas and products, Arm is promoting inclusivity and diversity in the tech industry, which is essential for driving sustainable and innovative technological progress.

In conclusion

SoftBank's Arm is poised to change the landscape of AI chips with its upcoming launch, offering a potentially massive solution for engineers and the industry at large. With its competitive positioning, technological advancements, and commitment to inclusivity, Arm is shaping the future of AI computing and driving the world towards a new era of intelligent, efficient, and innovative technology solutions.


By Robin Mitchell

Robin Mitchell is an electronic engineer who has been involved in electronics since the age of 13. After completing a BEng at the University of Warwick, Robin moved into the field of online content creation, developing articles, news pieces, and projects aimed at professionals and makers alike. Currently, Robin runs a small electronics business, MitchElectronics, which produces educational kits and resources.