Low-power processor expert ARM may have finally got the push it needs to dominate the netbook market: a partnership with manufacturer TSMC.

Officially announced by ARM's John Heinlein, the collaboration - which he describes as "the broadest agreement between the two companies to date" - will see TSMC manufacturing Cortex and CoreLink chips, while ARM pledges to optimise its designs for "TSMC's advanced process technology" in order to achieve top yields.

The deal also includes a long-term commitment to use TSMC as a primary partner to develop ARM 'physical IP,' to include custom-designed memory compilers and standard cell libraries designed to help all ARM partners assemble their processors.

The deal is a big one: under the agreement, ARM and TSMC promise to work on both the 28nm high-performance and low-power chip ranges due later this year along with a planned 20nm chip range - which ARM can now start designing specifically for TSMC to produce.

ARM currently holds a near-monopoly in the smartphone sector: almost every portable device uses some variant of its processor technology due to unrivaled performance-per-watt characteristics which keep power usage and heat output to a bare minimum. One area in which the company has traditionally lacked, however, is manufacturing: positioning itself as a pure-IP company, ARM licenses its designs to external manufacturers - unlike rivals Intel and AMD, which by and large produce their own processors.

While this allows ARM more freedom to innovate with its designs, it can increase costs and time to market. This latest partnership with TSMC will see ARM being given unprecedented access to TSMC's not-inconsiderable manufacturing capabilities - something which could give ARM the capacity it needs to take Intel and AMD on in the netbook market and win.

With an increase in the number - and quality - of chips available, a win in the netbook sector could leave ARM well positioned to make an assault on the far larger notebook market - and should Microsoft feel threatened enough by open-source Linux distributions making inroads on ARM-based netbooks to produce an ARM-compatible version of Windows 7, even industry leader Intel could have cause to worry.

Do you believe that ARM's deal with TSMC will spell massive changes to the computing marketplace - and possibly even an end to the reign of x86 - or will it just result in faster, cooler smartphones? Share your thoughts on the deal over in the forums.
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