Arm is positioning its chips as the main processors in the low end laptop market, but does not expect these chips to account for a significant part of its revenue, according to a company executive.

It decided to enter this market mainly to counter Intel's moves in the mobile phone market, Simon Segars, Arm's executive vice president and general manager of its Physical IP Division, said in an interview.

The company forecasts that royalties from its microprocessors in laptops and other entry level computing devices may account for between 5 to 10 percent of its royalty revenue in five years, he added.

Unit sales in the mobile phone market are likely to be far larger than the low end laptop market, Segars said. There is also the trend for sophisticated mobile phones to have up to four or five Arm processors in them, he added.

The main reason why Arm is targeting the low end laptop and desktop market is that it would like to place significant hurdles to Intel's bid for the mobile phone market in which Arm has a dominant position, Segars said.

If mobile phone vendors like Nokia and Samsung want to get into computing devices, Arm would prefer they use its chips rather than look to alternate suppliers like Intel, he added.

"We are more worried about Intel encroaching into the high end of smartphones, than we are about netbooks," said Segars. If Arm is successful in devices like netbooks, it will be a nice incremental revenue for the company, he added.

Arm designs processor cores that are licensed to chip makers and vendors like Freescale, Texas Instruments, Marvell, and Nvidia. These chip vendors then use the cores in chips known as SoCs (System On a Chip) designed for mobile phones, including smartphones, and some of these companies are now targeting the entry level laptop market. Some small computer makers like Pegatron have announced entry level laptops and desktops built around these processors.

Arm last month increased the clock speed of its Cortex A9 processor to 2GHz, positioning it against Atom, Intel's processor for the entry level computing market. Arm's low power and low cost technology helps drive down system costs on fans, and makes the devices power efficient, Segars said.

Though the Arm architecture can run Linux, including a distribution from Ubuntu, Microsoft has said its upcoming Windows 7 operating system will not support the Arm architecture. A mobile version of Windows is already ported to the Arm architecture.

If Windows 7 is ported to its architecture it would certainly help, but its absence is not "the end of the world" for Arm, Segars said. Linux computing is taking off, and a lot of people are happy doing web browser based computing, and accessing office and other applications in the cloud, he added.

Kids and many other users do not run office applications, but use their computers for YouTube, Facebook, email and other online applications, according to Segars. "For that you don't need office applications, but things like video codecs," he added.

Arm announced earlier this month that Adobe Flash Player 10.1 will be supported on Arm powered devices. "Our view is that Microsoft would have to be crazy to ignore us forever," Segars said.

Google's Chrome operating system could also change the low end laptop market in favor of Arm, as the operating system will support both Arm and x86 processors. As it is backed by Google, the new operating system may also make Microsoft change its mind on a port of Windows 7 on Arm, Segars said.