IBM [NASDAQ:IBM] today announced jointly with ARM [NASDAQ:ARMH] that they would be licensing both ARM’s Cortex line of processors as well as their Mali GPUs. Specifically, the company mentioned that they would be licensing the ARM Cortex-A15, Cortex-A12, Cortex-A7 and Cortex-M4 processors, as well as the ARM Mali-450 GPU. IBM specifically noted that this licensing agreement between the two companies is a result of the fact that IBM’s custom chip design business saw an interest in the technology.

Considering the fact that IBM designs various chips for their customers, it makes sense that they would want to license ARM cores for certain uses. IBM’s own press release mentions networking customers, cellular base station companies and other networking solutions. Clearly IBM was interested in licensing ARM cores for these designs because they are well known for their power-saving architectures. While the A15 isn’t considered to be the most power-saving of architectures, the others mentioned are very power stingy.

This comes as a surprise to some, since IBM has always been a company that has designed their own processors using the Power ISA. IBM’s chips can be found in a broad array of products ranging from the Power 7 in certain cloud, big data and supercomputing applications down to the Espresso processor, which can be found in the Wii U. IBM has licensed ARM architectures in the past for their custom chip design customers like Nintendo, however, this shows a significantly larger commitment to ARM architectures than in the past. This could be attributed to the fact that IBM recently opened up their Power architecture with the newly announced Open Power Consortium

I believe that we may see IBM moving into ARM-based Microservers in order for them to be able to compete with that segment of the server market, which continues to see more and more growth. They could theoretically go with Intel’s latest Atom processor architecture for their Microservers, however, I believe that IBM wants to develop their own chips and fab all of it themselves. I don’t really see IBM trying to design many mobile processors for customers, but I wouldn’t rule it out. Right now though, they seem to be primarily interested in facilitating their networking customers’ needs.