ARM is targeting microservers, which isn't Xeon based on Ivytown. ARM is going after the Atom-based C2000 processors.
Ivytown Xeon vs. ARM microserver won't be much of a wrestling match: Semi-Truck vs. Fiat 500. One gets a lot of work done, and the other is very fuel efficient. Those meetings on the highway tend to leave one of them pretty squished. :)
@Some Guy: True and I tried to be clear on this in the story. Ivytown and X-Gene are not head-to-head competitors.
However, it's worth noting OEMs say many sevrers no longer need performance as much as lower power. For many jobs a high end Xeon is no longer needed if its just about pushing data through the Ethernet and stroage interfaces. So in this way the two very differently focused products are wrestling over a pie of sometimes overlapping workloads.
@Rick - the point is that pie is already divided and the ARM is going after a piece that is already covered by Intel, which is already on its 2nd-generation Atom microserver chip before ARM is even out of the gate. Kind of like how the Japanese car makers were already on their 3rd-generation design of hybrid cars before Detroit ever got in the act.
At the same time, it will be interesting to see how it goes, especially when the advantages of ARM disappear with the microcode being less of the function blocks in the total chip, and the power advantage gone ... not to mention all the other server requirement, e.g., 64-bit, IO, cach, ECC, etc. The most ironic outcome would be that they end up with ARM creating a niche and it all ends up coming from Intel on its advanced process.