Why are there only two CPU companies?

why are there only two CPU companies

Life feels good when we have a lot of options. Who doesn’t like to see a lot of restaurants when going to the food court of a shopping mall? But, this isn’t the case in the CPU world. All of us own laptops and PCs of different configurations. I am going to shift your focus to one thing which you might have wondered at least once in your subconscious mind- Why are there only two CPU companies in the world?

We keep checking many devices across several e-commerce platforms and we see that the CPUs in these laptops/PCs are either Intel or AMD(95% of the time!). Isn’t it? Have you ever wondered why? Is there no other company in the world that wants a piece of the action? In this article, I will try to clear all your doubts regarding this duopoly.

The Main Reason

To get the answer, we have to dig deep into history and look up at the first PC ever made. Yes, I am talking about the original IBM personal computer from 1981. IBM chose the Intel 8088 CPU, to power the machine, which was based on the x86 instruction set. Intel was one of the first companies which started to manufacture CPUs at that time. And when the IBM computer came out, it literally had no other option than to go with Intel.

This became an enormously consequential choice from IBM as that PC exploded in popularity and literally pushed all other PC manufacturers out of the market. The reason was that it was high on performance and offered great value for money. 

As time passed, many software developers started to write programs for PCs that utilized the x86 instruction sets. Suddenly, Intel became a very powerful name in the microcomputer CPU space. In fact, Intel started licensing x86 architecture to other companies to keep up with the ever-growing demand. In this way, it doesn’t have to manufacture all CPUs on its own, but still make money out of this scenario. 

Here comes the most ironic fact – AMD was one of these licensee companies and you will be surprised to know that AMD still has that x86 architecture license. AMD and Intel are arch-rivals till the present day, but AMD sometimes uses that license to beat Intel at its own game. Isn’t it fantastic?

Now, you might be wondering, if AMD was one of the licensee companies, how did it grow so much? How is their rise able to give Intel fits till today? It is because AMD started improving upon the x86 architecture to compete with team blue, and chose just not to be Intel’s chip supplier! 


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Other Comapnies

Out of all the CPU companies, AMD wasn’t the only company that tried to burst out into the CPU space by improvising the x86 architecture. They simply had better resources and knowledge to become a serious contender as they were already a publicly-traded company.

Other CPU companies also tried to make something out of this scenario but they simply didn’t compete well enough. One notable example is Cyrix which went toe-to-toe with Intel’s Pentium lineup in the mid-1990s. One infamous mistake that caused Cyrix a huge loss was that they decided to focus on integer performance to compete with Pentium.

Cyrix believed that the trend of most desktop programs using mostly integer-based processing would continue. But what actually happened is that the developers coded for the floating-point unit of Pentium due to its high popularity. So, Cyrix’s challenge didn’t last much longer. Other companies were too late to come into the scene, as they were never able to offer whatever team red and blue were offering.

It is also very notable that how Apple switched from PowerPC to Intel simply due to Intel’s high power per watt. The next major innovation in CPU’s 64-bit processing was developed by none other than team red and they cross-licensed that technology to Intel. This marked the beginning of the modern era of x86-64 computing which is used by almost all PCs. This made it even harder for the smaller chipmakers to get a foothold of profit from the x86 microcomputer CPU space.


You may notice that this fight revolves only around the x86 architecture. So, companies that focused on other instruction sets have done quite well. The best example is Qualcomm which is a huge name in the mobile space known for manufacturing ARM-based chips. Apple also made headlines for releasing its NaN x86 M1 processor, which delivers impressive performance for Mac users.

But, if you are a tech-enthusiast, I wouldn’t expect this duopoly to disappear anytime soon. But, you can relax as this fight is surely never going to involve politics(I hope so!).


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