International Business Machines Corp. (NYSE: IBM) invented a revolutionary new chip. That is a big deal, since computer chips power every piece of technology we use, on a personal and industrial scale. IBM announced yesterday that it has created the smallest and at the same time the most powerful chip of all time. The company claims the chip is built with parts that are microscopic, no larger than a strand of DNA. The stock of IBM rallied today, jumping by more than 2% over the day.
The technology company explained that they used silicon-germanium to manufacture the chip, as opposed to pure silicon. Silicon-germanium makes transistors to switch faster, while consuming less power. The chip is expected to be about four times faster than today’s best chips on the market. IBM revealed that processors with more than 20 billion transistors might be a possibility.
IBM collaborated with GlobalFoundries, Samsung, and the State University of New York (SUNY) on research and development of the tiny processor. This collaboration cost IBM $3 billion in investment expenses. The chip will be implanted in next generation smartphones, computers and other gadgets, which will be much more energy efficient and faster. IBM representatives said that the technology will crucial in “meeting the anticipated demands of future cloud computing and Big Data systems, cognitive computing, mobile products and other emerging technologies.”
The new chip steals the spotlight from the leader of advanced chip manufacturing Intel (NASDAQ: INTC), and since the new technology is not ready to be distributed yet, it’s unclear at the moment by how much and how quickly it will heart Intel’s position in the market.