Annual Report and Accounts 2010

20/20 vision

ARM was 20 years old in 2010. In these next few pages the ARM executive team discuss the journey the company has been on for the last two decades and how ARM may benefit as current trends unfold between now and 2020. ARM is still a young company and, with only about 28% of processor development out-sourced, the opportunity ahead of us is far greater than what we have achieved so far.

apple newton

Apple Newton
Apple was one of the early investors in ARM, and their Apple Newton one of the first devices to contain an ARM processor-based chip. Over the past 20 years ARM’s customers have sold about 25 billion chips, with a value of approximately $150 billion.

The ARM team
The 12 founders from Acorn were all engineers. They were joined by Robin Saxby as CEO to add some commercial experience. At the end of 2010, ARM employed nearly 1,900 people; the majority of them are engineers.

nokia phone

Nokia 6110
One of the first phones to take advantage of ARM’s low-power technology was the iconic Nokia 6110. Today, over 95% of all the world’s mobile phones contain ARM processor-based chips.

Sir Robin Saxby
Robin was ARM’s CEO until 2001 and was once described by a Morgan Stanley analyst as “the grit in the oyster that formed the pearl”.

Sony monitor

Sony Bravia digital-TV
In 2010, ARM was in about 28% of all the world’s chips with embedded processors, up from 23% the previous year. This trend is likely to continue as semiconductor companies look set to continue out-sourcing their technology to ARM.

SWOT – 21 days after the Company started
From the start ARM knew that one of its unique strengths was its low-power, small processor, and it had opportunities in portable devices and in global markets.

samsung phone

Samsung Galaxy Tab
Samsung’s Galaxy Tab was one of many ARM- based mobile computers launched in 2010. More ARM processor-based computers are expected to be launched in 2011, and ARM’s partners are developing technology for servers and PCs. ARM’s HQ remains in Cambridge and now ARM has 30 offices in 14 countries.

The barn
ARM’s first home was in a converted turkey shed in Cambridge, UK.

The first ARM processor was developed by Acorn in 1985 for a low-cost PC. Although a technical breakthrough, commercial success was limited until ARM was founded in 1990 to take the technology forward. Twelve engineers, with some technology from Acorn and seed funding from Apple, started to look for applications that needed a low-cost, low-power embedded processor. No one could have guessed that a new consumer product was about to take the world by storm, and that it needed a chip with a smart processor which was both low-power and cheap to build... the mobile phone.

In the early 1990’s, developers of the first digital mobile phones were looking for a processor to run the phones’ 2G protocol stack. It needed to be smart enough to keep the phone connected to the network, and to manage the user interface, but low power enough not to drain the battery. It needed to be in an embedded system-on-chip to keep the cost down. Industry pioneers such as Nokia, Philips, Texas Instruments and Samsung recognised that ARM’s technology was well suited to this task and that ARM’s new processor design, the ARM7TDMI, was an ideal fit. ARM’s business model, with an upfront fee to gain access to the design and a royalty on any chips based on that design, enabled multiple companies to benefit from ARM’s innovation. The combination of ARM’s technology and business model enabled ARM’s processor to become adopted in the majority of the mobile phones ever made.

The mobile phone was just the first of many waves of consumer electronic devices that needed smart chips with processors that were low-power or low cost-to-build. Although some of ARM’s Partners had originally acquired the technology for use in mobile devices, they were now entering new markets by reusing those designs in chips for digital cameras, hard disk drives and printers, and more recently in digital TVs and microcontrollers. Since then ARM has introduced new generations of processor families that are smarter and even more efficient, and ARM technology has become increasingly suitable for a wider range of end markets and applications.

Over 20 years, ARM has grown from a start up to almost ubiquity, developing technology that spans from sensors to servers. This has been achieved through the combination of the best technology, the best business model, the best ecosystem, built around people with vision and who excel in technology development and the management of a high-tech business. Together these combine to give a great opportunity for future growth.

Over the last 20 years, ARM’s Partners have shipped about 25 billion ARM technology-based chips. Over six billion of these chips were shipped in 2010.