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qualcomm sales officeSan Diego based chip maker Qualcomm and China’s Guizhou Huaxintong Semi-Conductor company have announced a joint venture to develop new server chip sets designed for the Chinese market.

The news comes only a week after chip maker AMD announced its new Opteron A1100 System-on-Chip (SoC) for ARM-based systems in data centre. Both partnerships reflect how server design for data centres is evolving to suit the cloud industry.

The Qualcomm partnership, announced on its web site, was formalised at China National Convention Center in Beijing as officials from both companies and the People’s Government of Guizhou Province signed a strategic cooperation agreement. The $280 million joint venture will be 55% owned by the Guizhou provincial government’s investment arm, while 45% will belong to Qualcomm subsidiary.

The plan is to develop advanced server chipsets in China, which is now the world’s second largest market for server technology sales.

The action is an important step for Qualcomm as it looks to deepen its level of cooperation and investment in China, said Qualcomm president Derek Aberle. In February 2015 BCN sister publication Telecoms.com reported how the chip giant had fallen foul of the Chinese authorities for violating China’s trading laws. It was fined 6 billion yuan (around $1 billion) after its marketing strategy was judged to be against the nation’s anti-monopoly law.

“The strategic cooperation with Guizhou represents a significant increase in our collaboration in China,” said Aberle. Qualcomm is to provide investment capital, license its server technology to the joint venture, help with research and development and provide implementation expertise. “This underscores our commitment as a strategic partner in China,” said Aberle.

Last week, AMD claimed the launch of its new Opteron A1100 SoC will catalyse a much more rapid development process for creating servers suited to hosting cloud computing in data centres.

AMD’s partner in chip development for servers, ARM, is better placed to create processors for the cloud market as it specialises in catering for a wider diversity of needs. Whereas Intel makes its own silicon and can only hope to ship 30 custom versions of its latest Xeon processor to large customers like Ebay or Amazon, ARM can licenses its designs to 300 third-party silicon vendors, each developing their own use case for different clients and variants of server workloads, it claimed.

“The ecosystem for ARM in the data centre is approaching an inflection point and the addition of AMD’s high-performance processor is another strong step forward for customers looking for a data centre-class ARM solution,” said Scott Aylor, AMD’s general manager of Enterprise Solutions.

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