Microsoft has started working on its in-house chip designs using ARM architectures and the aim is to support is the datacentres powering Microsoft’s cloud computing systems, which include Azure for business and OneDrive for consumers.

Most datacentres are being powered by Intel’s Xeon series chips built on x86 architecture and they are pretty pricy. 

Datacentre operators see in ARM architecture a power consumption advantage. With thousands of servers housed in one datacentre and dozens of datacentres distributed throughout the world, the hyperscalers like Microsoft need to consider the total cost when sourcing chips, including computing power, size, power consumption, as well as cooling costs. A minor saving on unit level could translate to big savings in total.

Microsoft has not officially confirmed or denied the report but it is pretty likely. Google started working on its own chips already in 2017, initially for its Pixel phones but later extended to its cloud infrastructure, with the OpenTitan open source chip design announced a year ago. Amazon has delivered two generations of its own data centre chips, called Graviton and Graviton2, with the first unveiled late 2018 and the second a year later. Alibaba’s Hanguang 800, its own datacentre processor optimised for AI, was announced in September 2019.

However Microsoftis  to design its own PC chips using ARM architecture in a similar business model to  Apple. To be fair, Microsoft has been doing this for a while. It has already launched Surface computers using Qualcomm Snapdragon chipsets.