Arm is reportedly making a major change to its business model, with plans to launch its own in-house chip, and has already signed Meta as a customer.

Arm designs the world’s leading mobile chips, serving as the basis for chips used by Apple, Qualcomm, Samsung, Google, MediaTek, Ampere, and more. Until now, Arm simply designed chips and then licensed those designs to customers. Depending on their license, companies could make various modifications to the designs to customize them for their specific needs. Apple, for example, has one of the most permissive licenses, allowing the company to heavily modify Arm’s designs to serve as the basis for its M-series chips.

According to Financial Times, via TechCrunch, Arm is implementing a major shift in strategy, with plans to make its own chip. Like other Arm-based chip companies, Arm plans to outsource chip manufacturing. The chip is expected to target the server and data center market, with Meta reportedly an early adopter.

Potential Fallout

The shift in strategy is a potentially dangerous one for Arm, and could ultimately backfire. Arm has a long and established reputation as the Switzerland of the semiconductor industry, selling its designs to any and all companies, while competing with none of them and showing favoritism to none.

With this new direction, however, Arm will likely find itself directly competing with companies it currently licenses designs to. What’s more, the company may face growing concerns among partners regarding whether it is holding back its best, most performant designs for itself.

Alternate Options

Should Arm alienate some of its partners, it could server to spur RISC-V adoption. RISC-V is an open semiconductor platform that was created to offer an alternative to ARM. Unlike Arm, however, no one company controls the semiconductor designs.

In fact, RISC-V International—the global non-profit that stewards the project—makes clear just how open the platform is on its website.

More than 4,500 RISC-V members across 70 countries contribute and collaborate to define RISC-V open specifications as well as convene and govern related technical, industry, domain, and special interest groups. RISC-V combines a modular technical approach with an open, royalty-free ISA — meaning that anyone, anywhere can benefit from the IP contributed and produced by RISC-V. As a non-profit, RISC-V does not maintain any commercial interest in products or services. As an open standard, anyone may leverage RISC-V as a building block in their open or proprietary solutions and services.

RISC-V does not take a political position on behalf of any geography. We are proud to see organizations from around the world working together in this new era of processor innovation. RISC-V was founded in 2015 as the RISC-V Foundation and is incorporated today as RISC-V International Association in Switzerland.

While RISC-V adoption has yet to pose a serious challenge to Arm, a few major players moving to it in response to Arm’s latest development could go a long way toward helping the open semiconductor platform go mainstream.