"The data center is being inundated with massive amounts of data and there has to be a way to do it more efficiently in a smaller space with a lower cost point," she said.

ARM architectures are considered more energy-efficient for some workloads because they were originally designed for mobile phones and consume less power. That has attracted several vendors to the space, including Calxeda, Applied Micro and Marvell, all of whom are developing ARM-based chips for servers.

AMD hopes to distinguish itself with two SeaMicro technologies -- a custom chip that integrates many components from a traditional server board onto one chip, allowing for dense server designs; and its Freedom Fabric, which can connect thousands of servers in a cluster with low latency and at relatively low cost.

"The fabric technology is the secret sauce; this is what will make AMD's server solution different from other vendors," Su said.

Intel has said it won't make ARM-based processors, in part because it doesn't want to pay ARM a royalty on each chip. But it has been working hard to reduce the power consumption of its own server chips and said it is confident of its technology roadmap.