SAN JOSE, Calif. — Just a mile down the road from the headquarters of archrival Intel Corp., ARM Ltd. opens its annual Silicon Valley technical conference today announcing a new core to anchor its high-end line of mobile and embedded processors.

The move represents one of several directions in which ARM is flexing its muscle to address new and old competitors and opportunities. Separately, ARM will use the event to bolster its nascent position in graphics, extend its progress in microcontrollers and take a step in a new direction with FPGAs.

But the main star of the ARM 2009 show is the A5, aka Sparrow, a new entry-level member of the Cortex family. It is positioned as the logical upgrade for today's ARM926EJ-S and ARM11 cores, bringing that diverse set of products under one software-compatible umbrella.

It's a good time for ARM to rationalize its product line. When this conference opens next year, Intel will be preparing to sample a 32nm version of its Atom processor, directly challenging for the first time ARM's nearly complete dominance of the huge mobile device market.

ARM has as much as 98 percent of the handset market. "I am told they have an average of 2.5 processors per cellphone, and I believe it," said Will Strauss, market watcher with Forward Concepts (Tempe, Ariz.).

ARM-based designs such as Marvell's Armada, Nvidia's Tegra, Qualcomm's Snapdragon and Texas Instrument's OMAP seek to push ARM's prowess beyond handsets into small notebooks and other mobile systems. But the world's biggest chip maker has a keen focus on using current and future versions of Atom to dominate netbooks and break into smart phones, a growth market beyond PCs it has long coveted.