AMD eyes switch to low-power Arm chips Struggling chipmaker AMD will try to step out of the long shadow cast by arch-rival Intel on Monday as it announces plans for its first server chips made with the low-power designs of UK-based Arm Holdings. The announcement also signals a broader push by Arm to invade the internet-connected datacentres that have proliferated with the spread of "cloud" computing. In the process, it will widen a battle with Intel that already takes in tablets and, with the arrival last week of Microsoft's Windows 8, some types of PCs. According to people familiar with its plans, AMD will make the announcement at an event in San Francisco on Monday. The company declined to comment. Arm-based chips are used in most smartphones and tablets, thanks to lower power consumption than rival processors based on the so-called x86 architecture employed by Intel and AMD. Using them more extensively in servers as well could hold down power costs for internet companies as more computing is concentrated in centralised datacentres, said Nathan Brookwood, an analyst at Insight64. AMD has long struggled to keep up with Intel in the PC business, which accounts for three quarters of its revenues. This month it reported a 10 per cent year-on-year fall in its revenues for the latest quarter and forecast another 9 per cent decline in the final months of the year, while Intel is holding its revenues generally flat. Branching out into Arm processors would give it a clear technology differentiation from Intel for the first time, according to industry analysts. "This will position AMD as the only company that can do x86 and ARM," said one person familiar with its plans. However, the diversification will not bring short-term relief for AMD, which recently said it would cut 15 per cent of its workforce to try to staunch the red ink from its current slump. While it is set to announce an Arm-based processor this week, servers containing the chips are unlikely to reach the market until 2014, two people said. Though a small number of servers already use Arm chips, the technology has not been widely adopted because the chips can access only small amounts of computer memory, greatly limiting the complexity of tasks they can handle, said Mr Brookwood. With the next generation of Arm designs, using the same 64-bit technology that Intel's chip architecture moved to some years ago, memory will no longer be a limiting factor, he added.