ARM and TSMC said they aim to loosen Intel's stranglehold on the data center market.

The two companies reiterated that they are going to extend their ongoing collaboration with a new agreement to work together on the next generation of semiconductor processing technology. That the two plan to make an assault on the data center market might have been assumed, but today's announcement appears to be the first time the two acknowledged it explicitly.

ARM Ltd. has an army of technology partners who figure that ARM processors, currently popular in mobile handsets, are also suitable for at least some data center applications. And since sustained monopolies in any market in technology are as rare as vegans at a Ruth's Chris Steak House, their expectation is that Intel will inevitably have to lose some market share to somebody.

And Taiwan Semiconductor Manufacturing Co. (TSMC) (NYSE: TSM) is one of the very small handful of companies with the manufacturing prowess and resources to give Intel any competition at the leading edge of semiconductor technology.

TSMC and ARM have worked together on 16nm and 10nm FinFET semiconductors that have featured ARM Artisan foundation Physical IP. The new agreement is to shrink FinFETs down to 7nm, which will lead to more than enough processor performance improvement to justify the seemingly modest scaling.

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Since they have not said otherwise, ARM and TSMC will apparently stick with silicon (silicon on insulator) for its 7nm circuitry.

Intel has signaled that it may give up on silicon for the 7nm node at the 2015 ISSCC conference. The alternative is likely to be one of the III-V materials. Last summer, IBM Corp. (NYSE: IBM) demonstrated a working 7nm FinFET.

Working 7nm systems on chips (SoCs) are not expected for at least a couple of years from any of these companies.

Pete Hutton, ARM's executive vice president and president of product groups, said in a statement, “Existing ARM-based platforms have been shown to deliver an increase of up to 10x in compute density for specific data center workloads. Future ARM technology designed specifically for data centers and network infrastructure and optimized for TSMC 7nm FinFET will enable our mutual customers to scale the industry’s lowest-power architecture across all performance points.”

— Brian Santo, Senior Editor, Components, T&M, Light Reading