Bloomberg reports that search giant Google (NASDAQ:GOOGL) is considering a foray into designing its own chips. Those processors would power Google's vast network of data centers in a move toward vertical integration. In doing so, Google could realize efficiencies by designing its own hardware and software. That could also be a blow to Intel (NASDAQ:INTC), since Google is currently a big buyer of data center processors.
The chips would reportedly be ARM-based chips, but Google has no meaningful experience or expertise designing chips. It also doesn't have an instruction set license to make fully custom chips, but it could feasibly implement an off-the-shelf core. Even then, ARM's 64-bit server chips aren't expected to ship until late 2014. The move may not happen at all, but if it does, it wouldn't be immediately.
In this segment of Tech Teardown, Erin Kennedy discusses Google's plans with Evan Niu, CFA, our tech and telecom bureau chief.
Neither Erin Kennedy nor Evan Niu, CFA, has any position in any stocks mentioned. The Motley Fool recommends and owns shares of Google and Intel. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.