Dive Brief:

• Amazon.com is adding microchips to the line of products its sells under the Amazon brand, which includes essentials such as batteries and computer cables. 
• The chips are built by Amazon subsidiary Annapurna Labs and intended for use in data centers and devices that stream video or connect to the Internet of Things. 
• The technology behind the low-cost chips competes with Intel in servers, but so far has a miniscule share of the market. 

Dive Insight:

Amazon subsidiary Annapurna Labs has developed a line of computer chips for use in building servers, Internet of Things (IoT) devices and other devices. The Alpine line is built on ARM Holdings Plc technology, which has already been used to build servers but so far has a tiny percentage of the market.

Intel is the dominant provider of server semiconductors worldwide, with 99% of the market. But Amazon may be looking to power its Amazon Web Services cloud-computing unit and its own servers independently. Alpine microchips are not for sale on Amazon’s main retail marketplace.

Low-cost Alpine chips could allow Amazon to expand its role in connecting IoT devices to the cloud, where it has quietly built 10 times the computing capacity of its next 14 competitors combined. With Amazon Echos under the Christmas tree in many a Middle American home last month, the day when every consumer connects to the company directly may not be far off.