With the launch of the Intel (NASDAQ: INTC) -based Chromebook 2, Samsung (KRX: 005935) is offering a non-ARM (LON: ARM) options to buyers, but that may all change in the near future. The Chromebook segment is the only area in the notebook space that has seen any positive growth this year, with overall sales projected to double from last year. With the increased demand comes the question of whether Intel will be able to successfully contest in this segment, or concede to ARM.

ARM’s steady growth

First-generation Chromebooks featured Intel’s low-powered Celeron CPUs, and while generally considered to be great value for money, they neither had the trendy designs nor the desirable hardware specs boasted by their predecessors, which incidentally gravitated to ARM’s offerings.

The reason for the shift is likely two-fold: ARM’s success with its ARMv7 architecture meant that for low-peer devices, SoCs like Samsung’s Exynos 5, which was used in the Chromebook 2 as well as HP’s Chromebook 11, were a viable contender to what Intel was offering. Another factor was the cost savings that are inherent with ARM hardware, which does not carry the premium that is associated with Intel.

The main difference is the when it comes to the performance. Whereas earlier ARM SoCs lost out in terms of multitasking prowess to Intel’s hardware, newer processors like Nvidia’s Tegra K1 manage to hold their against Intel’s Bay Trail CPUs. The crux of the situation is that ARM started out with low-power processors, and then as performance demands increased in the mobile segment, scaled its architecture to meet the demand. Intel tried to go top-down with its mobile strategy, which did not fare well for the manufacturer as it never quite managed to offer the same amount of efficiency as ARM-based hardware.

Furthermore, the fact that ARM merely licenses the technology to vendors means that there is more differentiation when it comes to the final hardware: For instance, the Tegra K1 comes with a 192 core GPU that is designed to tackle visually intensive tasks. With Chrome OS getting more feature-rich, there is a market for an SoC that offers a combination of both efficiency and performance.

Intel’s market to lose

After failing to meet its tablets sales target of 40 million, Intel may be looking to the Chromebook segment to salvage market share. The vendor has already indicated that it will decrease its contra revenues in the future, which makes further partnerships all the more challenging.

Which is why Samsung’s decision to sell an Intel-based Chromebook 2 comes at a crucial stage for the silicon vendor. Intel may still make some money off $250 Chromebooks, provided it offers device manufacturers a strong reason to include its hardware. It’s easy to write Intel off given the growth ARM is witnessing, but numbers indicate that the manufacturer still controls ore than half of the market share in the Chromebook segment.

Intel’s CEO Brian Krzanich stated that its success stems from the fact that its CPUs are designed to be ubiquitous, but that reasoning does not hold true when we’re talking about Chromebooks, as ARM’s processors run Chrome OS just as fine.

The field is still divided when it comes to choosing between Intel and ARM: Toshiba has decided to stick with the Celeron CPU in its full-HD Chromebook, which Acer has opted for the more powerful Tegra K1 CPU in its product, the Chromebook 13. HP, meanwhile, is offering both an Intel-based model and a Chromebook running Tegra K1. At the end of the day, vendors may just choose to stick with ARM given the wide variety of offerings from the likes of Samsung, Nvidia or even Qualcomm.

Intel may command a majority in the Chromebook segment for now, but with its unrelenting advancements and the imminent launch of even more 64-bit based offerings like the Exynos 7 Octa, ARM may just take the lead in this category as well come next year.

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Earlier this month, Samsung (KRX:005935) announced the Exynos 7 Octa, a 64-bit octa-core SoC with significant improvements in performance. The introduction of the Exynos 7 series also highlights Samsung’s shift to a 20nm process, a feat already achieved by TSMC (TPE:2330).

More efficient process

The move from 28nm to 20nm has discernible gains in efficiency, as showcased by Samsung during the announcement of the Exynos 7 Octa. The new SoC is claimed to be 25% more efficient when compared to the 28nm Exynos 5 Octa from last year.

Another significant advantage is in performance, with the latest SoC said to provide a 57% increase in performance. The increase in power is mainly due to the shift to the ARMv8 architecture, which sees the inclusion of 64-bit cores for the first time in an Exynos SoC.

The Exynos 7 Octa features four Cortex A57 cores that do the heavy lifting as well as four Cortex A53 cores that are utilized for more energy efficient tasks. The SoC supports HMP in the form of ARM’s big.LITTLE configuration, through which all eight cores can be active simultaneously.

Although Samsung strangely decided to not tout the benefits offered by the 64-bit CPU, the manufacturer did delve upon the Mali T760 GPU, which offers 74% increase in visual performance from T628MP6 GPU featured in the Exynos 5 Octa.

Other features in the new SoC include the addition of a new advanced multimedia format codec and a H.265 hardware decoder, along with dual image signal processors that allow users to record from both the front and rear cameras simultaneously. Also added is the ability to drive QHD (2560 x 1440 and 2560 x 1600) resolutions. 

Although the Exynos 7 Octa isn’t the first 20nm SoC manufactured by Samsung (that honor belongs to the Exynos 5 Octa), it is the first high-end mobile AP built by the silicon vendor. And with TSMC going full-tilt with a similar 20nm planar process, Samsung is going to need all the innovation it can muster.

TSMC threat

Samsung isn’t the only fab vendor shifting to 20nm, as rival TSMC has also commenced high-volume production on the 20nm process. TSMC is currently on a high after announcing its third quarter results, which saw the silicon vendor amass record revenues. The vendor has struck lucrative deals that may turn out to be significant in the long run.

One of the new deals is with Apple (NASDAQ:AAPL), which for the first time decided to forgo Samsung’s fab facilities in lieu of TSMC’s offerings for the production of the A8. While the motives behind the switch weren’t detailed, it is likely that TSMC’s production capacity, which is said to be double that of what Samsung can offer, played a key factor in the move away from the South Korean vendor’s facilities.

Apple stated during the announcement of the iPhone 6 that the A8 SoC was twice as dense even after an overall size reduction to the tune of 13% due to the shift to 20nm.  If that wasn’t enough, TSMC announced earlier this month that it was working with ARM (NASDAQ:ARMH) to deliver processors on a 10FinFET process node. The collaboration would result in the commercial availability of 10nm mobile SoCs by the fourth quarter of 2015, which would give ARM a sizable advantage over Intel (not that it needs one), as Intel’s (NASDAQ:INTC) 10nm node, dubbed Cannondale, will only be available sometime in 2016.

As for Samsung, it is likely that the chip vendor will continue to offer 20 nm SoCs for at least a year seeing as how the first batch of products featuring the hardware are just starting to be available to consumers. Samsung may have the largest market share in the Android segment, but when it comes to the mobile SoC segment, the manufacturer is far behind TSMC. With an increased focus on innovation and a closer collaboration with ARM, it looks like TSMC will be able to maintain that lead in the near future. 

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