Intel and Advanced Micro Devices have announced a new working team to ensure seamless software compatibility across their processors. The move comes in response to growing competition from Arm Holdings, which is increasingly making inroads in the mobile and data centre space. The formation of this alliance shows the pressures facing the traditional x86 architecture that Intel developed four decades ago.

x86 versus Arm: How the chip world is changing

Intel $INTC is known as the creator of the x86 architecture, which dominated the PC, laptop and server industry for forty years. This architecture has become the foundation for a huge part of the current IT world. AMD $AMD, a competitor of Intel, licenses this technology and also makes chips based on x86. Although the two companies are competitors in this respect, their relationship is legally clarified by a long-standing negotiated settlement.

However, although both manufacturers have similar technology, their market share is gradually shrinking, mainly due to Arm Holdings offering its own alternative. Arm does not produce chips itself, but licenses its architecture to chipmakers such as Apple, Qualcomm, Amazon, Microsoft and Alphabet. The company has thus established itself as a leader in mobile devices and data centres.

Why is Arm so successful? One of the key factors in its rise is its licensing model. Arm's contracts stipulate that all chips based on this technology must be able to run all Arm software. This means that software developed for any Arm chip will be compatible with products from different manufacturers, making life much easier for developers and companies using Arm.

The challenge for Intel and AMD: Compatibility and collaboration

Unlike Arm, where software and hardware always work together regardless of the chip manufacturer, with Intel and AMD processors the software sometimes has to be modified to work across their chips. Although both companies are based on a similar x86 architecture, each manufacturer implements some differences in their technology. This can lead to software compatibility issues, which pose a challenge for developers and users alike.

In response to this situation, Intel and AMD have decided to set up an 'advisory group' to work with other key players in the hardware and software space. Founding members of this group include companies such as Broadcom, Dell Technologies, Lenovo and Oracle. The goal of the group is to unify the efforts of manufacturers and software developers to ensure that chips from both companies are fully compatible and work reliably across a wide range of devices and applications.

The common goal: To ensure smooth operation for users and developers

The advisory group will focus on identifying and developing "key functions and features" for Intel and AMD chips that will ensure their compatibility with each other. Hardware and software manufacturers will provide technical input to achieve this goal. If successful, this project could greatly simplify life not only for developers but also for companies and users who use products based on Intel and AMD processors.

Intel CEO Pat Gelsinger, speaking at a developer event hosted by Lenovo in Seattle, said the x86 architecture is still viable and has the potential to adapt to new challenges. He said the x86 architecture is on the cusp of a new era of customisation and expansion, especially with the new opportunities presented by artificial intelligence (AI).

Looking ahead: what lies ahead for x86 in the AI era?

x86 technology, which has been the foundation for decades of computer hardware development, now faces new challenges. The rapid rise of artificial intelligence (AI) and its increasing demands on computing power require all manufacturers to be able to respond quickly to market needs. Intel and AMD see a great opportunity in adapting their x86 architecture for AI.

Gelsinger stressed that x86 is not dead, but rather poised for a "period of adaptation" and growth. As part of this adaptation, it will be important to ensure that x86 processors can not only support traditional applications, but also fully exploit the potential of new technologies such as AI.

Disclaimer: There is a lot of inspiration to be found on Bulios, but stock selection and portfolio construction is up to you, so always do your own thorough analysis.

Source: Investing.com, Yahoo Finance.