Of course they're scared. Even if Intel is able to close performance gaps, cloud computing is often an easy sell for ARM and Amazon is likely going to be able to get the chips cheaper given that they're looking for markup on the service end while Intel needs markup on the chip.

If I'm writing new software using Java, C#, Python, JavaScript, etc. it's easy to deploy to ARM. With Apple moving to ARM and 25% of developers using Macs (41-45% using Windows)*, there's going to be good ARM support for what developers need. Sure, some things might might run better on Intel and some things might not easily port, but that feels like it isn't the case for the majority of stuff that developers are going to be doing.

It seems likely that Microsoft and Google will introduce ARM-based instances. We know Google has dipped its toe in with its Tensor processor for the Pixel. We've seen reports that Microsoft has been working on ARM processors for servers. Qualcomm is gearing up for a major push into better ARM processors to compete with Apple on the desktop/laptop, but presumably they'd be happy to get cloud workloads as well. Oracle, while not a major cloud provider, has ARM-based instances already.

Intel has had a virtual monopoly for 20 years. Now they're facing a resurgent AMD stealing x86 marketshare and ARM processors that are quickly becoming a better price/performance option - and Apple is ensuring that everything developers need will be ARM compatible. I don't think it's an existential threat, but there's a huge difference between the margins you get as a virtual monopoly and the margins you get when you have to compete against strong competitors.

Plus, I'd guess that AWS is probably making sweet margins off those Graviton instances. Let's say that their margin on Intel instances is X and that margin on Graviton is 2X. That leaves AWS a lot of room to start pushing Intel out of their datacenters as old hardware is replaced. Let's say you're a company spending $100M/year with AWS and you're renewing your contract. Maybe Amazon suggests that they could give you a 20% discount off Intel boxes and a 40% discount off Graviton boxes - which they say are already 20% better price/performance so it's basically 52% off!

It also gives AWS negotiating power with Intel. If 20% of AWS customers move to Graviton, you can go to Intel and say, "we're finding Graviton processors really cheap to make and operate and customers are loving them...more and more they're realizing they don't need your Intel processors...if we don't get cheaper Intel processors, we might have to accelerate our incentives to get people onto Graviton boxes...the more we accelerate that, the more Google Cloud and Azure will likely want to prioritize ARM boxes..."

They're scared because it's the type of thing that snowballs until their lock-in is near meaningless. If ARM becomes 50% of the server market, there goes Intel's ability to demand high margins. 5-10 years from now, most deployments could use Intel or ARM based on price/performance rather than instruction set - and that makes life a lot harder for Intel.

The problem with this ad/page is that the ship has already sailed. Once Apple introduced its M1 MacBooks, we were getting first-class ARM support for everything developers would need going forward. It didn't happen overnight, but with Apple going all-in on ARM chips and with Macs being such a big player in developer usage, the war was lost that day. Now it's just a matter of time. Once all your devs are running and testing their stuff on an M1 MacBook, why not deploy it to an ARM instance?

* From StackOverflow's 2021 developer survey