Building a server farm used to be easy. You bought a bunch of computers that used off the shelf components, put them in an air conditioned room, hired a Linux expert with a wizard beard, and you’re off to the races. More recently, however, web services have started to scale to such large sizes that companies like Google and Facebook have begun designing their own custom power supplies and chassis to get even more performance and reliability, all while lowering their costs. But now Google is thinking about taking things one step further, designing their own chips.

According to Bloomberg, Google is “considering designing its own server processors using technology from ARM.” What’s crazy is that Google is actually Intel’s fifth largest customer, so for them to just back away and say they’d rather build their own silicon says quite a lot.

Why exactly would Google want to build their own server chip? Because Google knows what Google needs better than Intel does. That and ARM chips consume a fraction of the power that Intel chips do, so why not shove thousands of them in a space that used to only hold a couple hundred Intel chips?

The really interesting question here is what happens if Google decides to take everything they’ve learned from building server chips and apply it to smartphone and tablet chips? Apple is already designing its own processors for the iPhone, is it that hard to imagine Google announcing the “Android Chip” and then licensing it out to Samsung, HTC, Sony, and anyone else who wants to make a phone?

Crazier things have happened. The company that makes Office bought Nokia.