ARM Co-Founder: 'Intel Has Enormous Resources'

One of the founders of ARM Holdings on Tuesday acknowledged the threat which leading chip maker Intel poses to the company, while claiming that ARM's customers are optimistic about the future.

"Intel has enormous resources and you can't discount the power of a company with enormous resources," Tudor Brown told Reuters.

"Is Oak Trail going to be a competitor to ARM? It's probably getting closer. I still think ARM will have better power and efficiency," Brown said. "Although I believe we have a more appropriate business model and more appropriate technology, you can't just pretend it's not there."

ARM designs the reference architecture for chips that power a number of handheld and mobile devices, including virtually all currently-available smartphones and many devices in the burgeoning tablet market.

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Cambridge, U.K.-based ARM licenses its architectures to semiconductor manufacturers and OEMs for an initial fee and collects royalties for every ARM-based chip that sells. Apple has several offerings in the market that are powered by the ARM-based A4 chip, including the iPad, the iPod touch, and the iPad.

The report follows assurances from ARM CEO Warren East in Financial Times last week that ARM's advantage in mobile technology would prevent Intel from challenging ARM with its upcoming Atom-based, Oak Trail processors.

’Atom designs are just not good enough in terms of power consumption," East told the Financial Times . "Intel knows this."

Intel's CEO Paul Otellini said last month in a leaked internal e-mail that Intel plans to eventually take over the mobile market, and Intel believes it is developing the appropriate Atom-based platform in Oak Trail to power tablets.