LONDON – The share price of ARM Holdings plc soared on Wednesday (Dec. 22) on reports that Microsoft Corp. will use the Consumer Electronics Show in Las Vegas in January 2011 to demonstrate a version of its Windows operating system that will run on processors designed by the U.K. firm.
It is believed the version will retain backwards compatibility with the x86 architecture of Intel but the ability to run on cores from ARM (Cambridge England) sent the IP licensor's share price soaring. It was trading at 438 pence on the London Stock Exchange at 10.00am up 8.5 percent on the day.
Overnight a number of reports on Microsoft's Windows plans for the CES show emerged although one report said the product may not debut for another two years. A report from Bloomberg referenced two un-named sources saying that the Windows software would be tailored to battery-powered devices such as tablet computers and other handhelds. A Wall Street Journal report linked the ARM compatibility with Windows 8, the next version of the operating system that is not due to be available until 2012.
If it can come sooner rather than later it would allow Microsoft to attack in the mobile devices space where it has lost ground to Apple and Google. "They’ve got to come back with a product that’s better than 'me too' and is equal if not better in features," the report quoted analyst Robert Breza of RBC Capital Markets as saying.
The move was expected. In July 2010 Microsoft announced had taken an architectural license agreement with ARM giving the software giant access to the ARM processor architecture and the freedom to design its own ARM chips. Details of the agreement were not provided.
The trick to that model for Microsoft is how to get paid. They have been trying to push Win CE on a paid licensing basis. This has been the norm until Google came along. Now Microsoft has to figure out how to compete and still stay in business.
The win here for ARM is not necessarily Microsoft tablets. As pointed out above, ARM already has a solid hold in that market. The win is in server farms. A solid Windows family commitment gives ARM a whole new market segment in terms of entry into the massive server farms, where power usage is a real concern.
I've got a small, 2.5W, system running on CE5 on MIPS/RMI from MSC and the multimedia performance is great.
Regarding Windows ... currently the concept of an Operating System is slowly vanishing so the hardware platform used becomes even more irrelevant. More and more anything with a web browser is enough for the majority of users. In this case MS has to find a new target, perhaps some "internet terminals", ARM+Win?
Wish I could predict rumors. The psychology that makes ARM shares jump on the rumor that Windows might be ported to it must be really fascinating (if you're a head-shrinker). But it doesn't look like there is much choice for MS if they want Windows to continue as a viable product, given the (increasing) popularity of certain tablets.
Does anybody see red flags here with Microsoft designing their own ARM chips? In the SW arena they tend to adopt standards, add proprietary MS only extensions and then leverage all competition out of the market place. Google watch out! On other news, windows low power? you gotta be kidding. also, I've got a pioneer car entertainment system with WinCE running on ARM, and the performance is pathetic. If the audio side wasn't so good I'd trash it.
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