Processor improvements used to be about performance and more performance. Today, as just about all makers have mastered the 14 nm manufacturing process, the push is for improved integration and efficiencies. "Absolute performance may not be much of a factor anymore as companies look toward performance per watt as their new key metric," says Patrick Moorhead, president and principal analyst at Moor Insights & Strategy.
Moore's Law of doubling transistors on a chip every 18 months gets more difficult as processors shrink. "[During] the last 10 years there's been lots of effort in material technology and transistor design, but now packaging is becoming more critical," says Jim McGregor, principal analyst at Tirias Research. "They're not just processors anymore but full systems on a chip."
For mobile devices, for instance, adding radio processing in the CPU die shrinks total electronics size. More memory in multichip solutions "eases memory bandwidth bottlenecks," says McGregor.
Intel, still the leader, will launch workstation parts code-named Broadwell-E early in the year, says Moorhead. Kaby Lake, a possible speed upgrade to Skylake processors, will appear later in the year.
Servers remain a huge market for Intel. "The rule of thumb in the past was one server for every 24 PCs," says McGregor. "With the Internet it's now more like one for nine." Thank the data center buildout supporting cloud computing.
Yes, Intel may have missed the mobile and wearable markets, but McGregor sees the company focusing on embedded systems. "Back in the ’80s they sold more 186 and 286 processors to Ford than to PC makers,” he says. “They got away from embedded, then back in, and now sell more than $2 billion annually." Other areas of success include medical equipment, industrial automation, and digital signage.
From AMD, "We are expecting at least two new GPU architectures, and the much-awaited new CPU architecture code-named Zen," says Moorhead. Graphics processors should boom as more virtual reality and vision systems appear, both of which require heavy graphics processing. Vendors still see great value in AMD as a second source to Intel's processors for PCs and servers.
“Nvidia remains the largest graphics chip producer," says McGregor, "but has lots of competition from people like Freescale [Semiconductor Inc.] and Renesas [Electronics Corp.]." Demand for 4K graphics is growing, meaning more and better processors. A new focus on automotive applications for instrument clusters and command-and-control systems will help as cars get even more chip-laden.
Let's not forget the computer in everyone's pocket. "Qualcomm [Inc.] is poised to launch [its] new Snapdragon 820 early in 2016, and it's expected to be the preferred system on a chip of choice for most high-end Android smartphones and tablets across consumers and businesses," says Moorhead. Samsung will launch its new Exynos 8890 SoC that features an eight-core CPU design using its own CPU cores as well as a Cat 12/13 LTE modem on the same chip.
McGregor says while Qualcomm's 820 Snapdragon cornered the ultrahigh-end market, the growth is in the midrange. More advances are needed to move these processors down-market. "Look for mid- to low-range improvements like integration, lower power consumption, and a price reduction to [lower] pricing to consumers."
Various analyst predictions for Internet of Things (IoT) devices range up to 50 billion units on the Internet by the year 2020. All of those need processing power, but the low device cost means low profit margins for chipmakers. "The era of IoT is the embedded market really trying to leverage the mobile segment," says McGregor. "Vendors will try to leverage the same tech into everything from aircraft to medical to industrial applications. Companies like Freescale and TI [Texas Instruments Inc.] are focused on mobile apps."
Moorhead believes system builders "should significantly increase performance on the graphics end of things, allowing them to build smaller, cooler, and quieter systems" with the new CPUs and GPUs from Intel, AMD, and Nvidia.
Remember, all those newly affordable 4K high-resolution monitors require new graphics cards.