While the on-premises server business remains firmly in the grip of the x86 world, cloud service providers are giving Arm-based servers a much more welcoming embrace. Both Chinese cloud giant Alibaba and Microsoft Azure have recently launched new instances with Arm processors.\nAlibaba Cloud unveiled its Yitian 710 processor design for use in its data centers back in October 2021. The company also announced the development of its proprietary servers, called Panjiu, promising optimized computing performance and energy efficiency.\nYitian 710 is built on a 5nm manufacturing process and has 128 Arm cores, each with a top clock speed of 3.2GHz. It\u2019s built on the Armv9 architecture and includes eight DDR5 memory channels per CPU and 96-lane PCIe 5.0. Alibaba claims the Yitian 710 achieved a SPECint2017 that beat the current state-of-the-art Arm server processor by 20% in performance and 50% in energy efficiency.\nPanjiu was developed with a separation of computing and storage so the servers are optimized for general-purpose computing as well as AI computing. Alibaba also claims Panjiu is suitable for high-performance storage and a variety of cloud-native workloads, such as containerized applications. Alibaba is offering trial instances.\nThe operative question is: What are Alibaba\u2019s ambitions with Panjiu? If it\u2019s content to stay within the Chinese market, then it is no threat to the existing dominant players like AWS. But most Chinese companies seek to expand beyond just the China market, and Alibaba is modeled after Amazon in many ways.\nJohn Dinsdale, chief analyst & research director with Synergy Research Group, which follows the cloud market, says Alibaba has been more successful than other Chinese cloud providers at expanding its footprint and services beyond its home market of China.\nHe says that Alibaba now has a substantial cloud presence in Hong Kong, Indonesia, Malaysia, India and Singapore, but still derives the vast majority of its revenues from China and Hong Kong.\n\u201cIf Alibaba\u2019s Arm-based services are a strong competitor to AWS technologically, should AWS be worried? Well, even in APAC region excluding China, AWS cloud revenues are several times as big as Alibaba\u2019s. So I don\u2019t imagine AWS is losing much sleep,\u201d he said via email.\nAzure embraces Arm\nIt took a little while, but Microsoft Azure now offers a preview of Arm-based instances, something AWS has offered since last year.\nOne possible reason for delay on Microsoft\u2019s part is that it used a different processor. AWS\u2019s Arm processor is Graviton, a homemade chip developed by Amazon. Microsoft, on the other hand, is using the Altra processor from Ampere, the startup led by former Intel executive Renee James.\nPaul Nash, head of product, Azure Compute Platform, said the Arm instances can achieve up to 50% better price-performance than comparable x86-based virtual machines (VMs) for scale-out workloads, which is what Microsoft is targeting with the Arm instances. These workloads include web servers, application servers, open-source databases, cloud-native, .NET applications, Java applications, and more.\n\u201cThe demand for compute capacity to sustain business modernization and digital transformation initiatives continues to grow. Organizations are facing a complex set of challenges as they deploy a broad range of workloads globally, from the edge to the cloud. There is also a need for a new breed of operationally efficient cloud-native computing solutions that can meet this demand without a massive growth in infrastructure footprint and energy consumption,\u201d Nash said in a blog post announcing the instances.\nMicrosoft is made its array of developer tools available on Arm Azure, including Visual Studio C++\/C#\/F# and .NET 6. OpenJDK is also available for Arm on Azure.\nThe preview has limited availability for now and is only available in the West US 2, West Central US, and West Europe Azure regions.