Intel Corp (NASDAQ:INTC) has dominated the computer chip market for over a decade, but it seems the tide is changing as the industry becomes more competitive. Amazon.com Inc. (NASDAQ:AMZN) and Apple Inc. (NASDAQ:AAPL) are driving the change after the tech giants indicated that they would cut their dependence on Intel chips.
Intel losing dominance in the chip industry
Intel’s dominance in PC and server ships seems to be waning as the tech giants lean towards in-house produced chips. Apple became the first to announce dependence on in-house chips following the introduction of Mac computers using its Arm-based chips. The Macs used Apple’s ARM-based M1 chip. Amazon’s cloud computing division also started promoting its new computing service in June. Amazon indicated that the new service based on its Arm-based chips was faster and cheaper than services based on Intel chips.
Early this week, Amazon introduced another computing service for corporate users employing its ARM-based chips. The company shared gains users have made for the service it unveiled in June. Users that have benefitted from the service include Snap Inc. (NYSE:SNAP), the maker of the messaging app, Snapchat. Amazon also indicated that Twitter Inc. (NYSE:TWTR) would start using the tech as part of the expanded relationship between the companies. AWS’s computing infrastructure head, Peter DeSantis, said that larger customers are excited about the new offering.
Shift in chip manufacturing as tech companies shift to in-house chips
The moves by Amazon and Apple have triggered ripple effects across the $400 billion chip market. The company’s actions show that important decisions in the semiconductor sector industry could be shifting from chip suppliers that have long controlled power to chip-using to chip users having the capacity to produce their components. This is great news for PC users as the move could result in more tech choices, faster computing speeds, as well as low costs. Intel has been dominating the sector since the 1990s for PC processors and later venturing into low-priced server chips. However, the company didn’t manufacture smartphone chips that became popular in 2007.