It was interesting to see that Apple did not choose Intel's Atom microprocessor for the iPad.

Intel's Atom chips have been adopted by many companies building netbooks, which are similar in format to the iPad.

Instead, Apple chose to develop its own microprocessor design, the A4, based on the Atom rival architecture, ARM. The A4 chip was produced by the design team Apple acquired when it bought PA Semi nearly two years ago.

It's surprising that Intel wasn't able to win the iPad contract because it would have been able to offer Flash memory and other components to Apple as part of a package deal, for a lot less money than sourcing the components separately, and having to design your own chip.

ARM is designed for mobile applications and low power use. Plus there is a large library of add-on designs available that can be used to customize ARM chips for a variety of tasks.

But Intel's Atom architecture has a key advantage, it offers X86 capability. As long as netbooks need to run Microsoft software, Atom will prevail over competing ARM based configurations.

But will netbook type computers always be reliant on X86 software? Google's Android and Chrome OSes can run on both architectures.

The key trend to watch is whether smartphone OSes move up to netbook/tablet devices in a similar way that Apple has done with iPad.

But, some of the ARM advantage, in terms of low-power use becomes less important in computer devices with larger displays.

Steve (Chippy) Paine, points out:

When you get to screen sizes of 4" and above, something happens that levels the playing field for Intel somewhat. Their CPU platforms (*1) don't idle down very well but in a typical 'internet-connected' scenario on one of these 'smart' devices, that becomes almost insignificant as the screen backlight adds such a huge load to the platform that when combined with Wifi, 3G, BT, GPS and audio, the CPU is just 10% of the total load. Swapping Intel out for ARM would save you just 5-10% battery life in an 'active' scenario.

When you add up the entire power-bill for a device with a screen larger than 4 inches, then Intel's Atom family measures up fairly well compared to ARM based systems.

And with Intel's ability to crank out hundreds of millions of Atom chips at very low per-transistor costs, constantly driving down prices -- ARM based chips will face strong pricing competition in a segment of the market that is very price sensitive.

But, there are other factors to consider. With wireless data plans, it is possible to subsidize production costs.

And companies like to encourage competition, they don't like having to rely on one large vendor.

While Apple's choice to use its A4 might turn out to be a more expensive choice, it provides it with some useful strategic value.

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Here is another view of ARM from Jon Stokes "Thin clients and the cloud: how ARM beat x86 to the punch" :

As I poked and prodded the Lenovo Skylight, I pulled out my Nexus One and dropped it on top of the unit for a size reference so that we could snap picture of it. As I stood there looking at the phone laying on top of the smartbook and contemplating the fact that both of these (Android-based) devices had 1GHz, ARM-based Snapdragon processors in them, I glanced across the booth and spotted an ARM-based game console sitting right next to the ARM-based iRex Iliad e-reader. And then there was the portable media player (PMP) positioned not far away... then it really sunk in: smartphone, netbook, e-reader, PMP, game console--all popular consumer electronic categories with real computing needs and a huge audience, and all on ARM right now.

Intel, in contrast, is currently in the netbook, is aiming at the smartphone, would've liked to be a game console (they had an internal team pursuing a win with the erstwhile Larrabee GPU), and has yet to signal any interest in the booming and ARM-only e-reader market (though the chipmaker does have a kind of e-reader for the blind).