Jim Armitage: ARM is a British success story with chips that deserves praise
It’s frustrating that chip designer ARM isn’t championed here as Apple is in the US.
That a home-grown British company is leading the development of the world’s most revolutionary electronic products, from iPhones to internet-enabled washing machines, should tug on the patriotic heartstrings. Yet I doubt if many outside the gadgets world have even heard of it.
Today, ARM headed the FTSE 100 leaderboard as it reported yet another set of thunderingly good figures, just as Intel staff reeled from news of 12,000 job losses.
Like so many tech behemoths before it, Intel failed to recognise consumers’ rapidly changing digital habits — in its case, the move away from PCs to mobile and cloud computing. But ARM has always kept in front by investing heavily on research, spending more than quarter of a billion pounds on research and development last year.
That means its chip designs remain the best in the world; its customers have nowhere else to go.
ARM’s business model is clever too. It licenses its designs to manufacturers rather than making the chips itself, so it doesn’t shoulder the risk of running factories.
Conversely, chip-maker’s risks stay low because they can leave the design work to the experts at ARM, paying a small royalty on every chip.
As a result of all this, in the past three months alone, 4.1 billion of its chips were shipped around the world.
More power to ARM’s elbow.
