Chip Makers, Investors Gang Up On Intel, Invest $48M In CPU Startup


A group of chip manufacturers and investors are investing a total of $48 million in chip startup Smooth-Stone in order to challenge Intel's server processor business with CPUs that are more like those found today in smartphones.

Smooth-Stone, based in Austin, Texas, on Monday said it is raising $48 million to develop high-performance, low-power-consumption processors aimed at replacing standard server processors with new processors that can run the majority of data center applications while decreasing the amount of power required.

Investors in Smooth-Stone include a number of strategic partners, some of whom are Intel competitors, including ARM, which develops 32-bit RISC microprocessors, graphics processors, video engines, and semiconductor manufacturer Texas Instruments.

Also investing in Smooth-Stone is the Advanced Technology Investment Company (ATIC), a technology investment company wholly owned by the Abu Dhabi government in The United Arab Emirates. ATIC, along with Intel rival AMD, invested in setting up Globalfoundries, which manufacturers processors for AMD.

Other Smooth-Stone funding came from such investment firms as Battery Ventures, Flybridge Capital Partners, and Highland Capital Partners. The company previously received investments of at least $1 million from the State of Texas. Smooth-Stone plans to use the capital to develop and market its high-performance, low power-consumption processors.

The company won't be the first to use low-power processors to try to replace industry-standard processors in data center servers.

Santa Clara, Calif.-based SeaMicro in June came out of stealth mode with plans to develop servers that squeeze up to 512 Intel Atom processors in a 10U rack mount space to slash data center power and space requirements by up to 75 percent.

June also saw processor startup Tilera collaborate with server vendor Quanta Computer to unveil what they billed as the world's highest compute density server, a unit which fits up to 10,000 processor cores on a standard rack and is aimed at cloud computing and service providers.

Tilera plans to release its first server based on that technology in September.

Smooth-Stone CEO Barry Evans said on Monday in a statement that his company looks forward to taking advantage of the insights and know-how of its industry-leading investors.

"Our goal is to completely remove power consumption as an issue for the data center. Imagine that change for companies with a large presence on the Internet," Evans said. "They all deal with the reality that as the mass of information grows daily, so does their power consumption. Every day these companies are thinking about managing their data center sprawl. We want to make sure that space and power are not constraining their potential."