Cloud is ARM’s Secret Weapon Against Intel

Another report came out today that sees the competition between Intel (s INTC), with its Atom processor, and ARM (s ARMH) chipmakers for the lion’s share of the mobile device market as the fight of the decade. So far, Intel is winning, with its Atom processor in several netbooks. But next year, a class of smaller devices, such as Qualcomm’s (s QCOM) Snapdragon or Nvidia’s (s NVDA) Tegra, based on the ARM architecture, will arrive next year and offer Atom’s x86-based devices some real competition.

For now, ARM-based chips, which you can find in every smartphone, have a big advantage: they work for longer periods of time on a single battery charge. Next-generation Intel processors coming in the 2009/2010 time frame are trying to close that gap, but the difference in architectures means ARM chips are still more power efficient. However, some of that power efficiency comes at the expense of clock speeds.

A big downside to using ARM chips in a netbook today is that a lot of software that people might want to run on their MIDs and netbooks is designed for x86 chips, such as those sold by Intel or VIA Technologies. However, as more data and applications reside in the cloud, the only thing a user needs is an operating system and possibly a broswer, which is why ARM has been focused on optimizing a variety of browsers on its IP cores (which are then licensed to chipmakers, who build the actual processors).

While an Intel executive recently said (then apologized for the statement) that the ARM chip inside the iPhone couldn’t handle the Internet, such efforts could position ARM to trump Intel in the mobile market. After all, if you can access your data all day without recharging, ARM-based computing looks pretty compelling.