Last Wednesday was historic for Qualcomm. In one day, the company jumped beyond its comfort zone of mobile chips and entered the PC and server markets.
With the expansion, Qualcomm now has chips for most computing products. It wants to outcompete even Intel, which dominates in PCs and servers but gave up on markets like smartphone CPUs earlier this year.
Qualcomm on Wednesday announced its Centriq 2400 server chips, which started shipping to test customers. Later that day, Microsoft revealed that first PCs based on Qualcomm's Snapdragon 835 chip would come next year. The chip will also be used in high-end smartphones.
In some ways, Qualcomm and Intel are heading in the opposite direction. Qualcomm has grown and is now what Intel used to be -- a chipmaker dabbling in all the major computing products, from wearables to servers.
Intel, on the other hand, has left some markets after tough lessons learned through unabated chip expansion and throwing billions of dollars at products that ultimately failed. This year it downsized and cut unprofitable products like mobile processors -- a market Qualcomm leads -- to focus on growth areas like IoT, data centers, and machine learning.
Qualcomm's goal of joining the PC and server markets is clear: to challenge Intel's areas of strength. But trying to unseat an incumbent is easier said than done, and Qualcomm faces many challenges of its own. The jury is still out on whether Qualcomm will succeed, but the company is the first legitimate competitor to Intel in the server, PC, and IoT chip markets.
Qualcomm's first jab at the PC market was doomed with the failure of Windows RT, a version of Windows 8 for ARM-based tablets and PCs. But the re-entry into PCs with Windows 10 is better organized, and the ARM-based Snapdragon 835 will be able to run popular Win32 apps that typically run on x86 chips. Qualcomm's chips could pave the way for Windows 10 into the 5G era, an area where Intel is at a competitive disadvantage.
But it won't be easy for Qualcomm, which faces compatibility challenges with 64-bit applications, drivers, and peripherals. The Snapdragon 835 will run x86 apps through emulation, which limits hardware acceleration.
In the last two decades, only AMD has threatened to Intel's lead in PCs, but even that didn't last too long. AMD is mounting a new challenge with its upcoming Zen processors, and Qualcomm's ARM-based chips could take on Intel's Celeron, Pentium, and Core i3 chips in low-end PCs.
Qualcomm has no plans to give up on PCs anytime soon. The company's success with cellular PCs could take off when deployments for 5G -- which combines long- and short-distance wireless communications -- take shape in 2020. Qualcomm has already introduced the Snapdragon X50 5G modem, but it's not yet known if the Snapdragon 835 will have an integrated 5G chipset.
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