Last month, chip maker ARM said that several of its upcoming CPUs could be used to power netbooks. Now it looks like the company is moving forward with that plan. Laptop Magazine reports that ARM has partnered with Canonical to develop a version of Ubuntu Linux that’s optimized for ARM processors.

While most netbooks today are powered by CPUs from Intel or VIA, ARM has a strong track record of producing low power chips for cellphones, PDAs, and handheld devices. They aren’t exactly speed demons, but they do deliver long battery life. ARM says its next generation processors will allow a netbook to run all day on a single charge. Of course, there’s no mention of what kind of battery it will take to make that happen, but it’s still a pretty bold claim.

Right now almost every major laptop maker has a netbook on the market sporting a VIA C7-M or Intel Atom processor. But the ARM-specific version of Ubuntu isn’t due out until April, 2009, so it’s unlikely we’ll see an actual netbook using the ARM chip until the middle of next year at the earliest, which gives the company plenty of time to convince a big name computer maker to sign on.

Of course, by then, it might not be a three way processor race between Intel, VIA, and ARM. AMD is expected to announce its plans for the netbook space tomorrow.

In case you had any doubts that VIA’s upcoming Nano processor is targeted at the exact same market as the Intel Atom, VIA’s marketing department has put out a short video pitting a Nano chip against an Intel Atom chip. The devices? A protoype PC using VIA’s OpenBook design and the Asus Eee PC 1000H. The challenge? Playing WMV HD video.

The OpenBook comes out way ahead in the video, which is hardly surprising (if you were VIA, would you release this video otherwise?), but the challenge is a bit silly. After all, both of these computers have 1024 x 600 pixel displays. So what exactly is the point of watching 720p or higher resolution videos on them?

Still, it’s nice to see a real world comparison. Last week we saw the first benchmarks comparing the VIA Nano with the Intel Atom. But those benchmarks looked at the versions of each low power chip that are designed for desktops, not laptops. This video gives us a first look at how a 1.3GHz Nano stacks up against a 1.6GHz Intel Atom, at least when it comes to video playback. Considering how poorly the 1.2GHz VIA C7-M CPU in my HP Mini-Note handles standard definition video, it’s nice to see that the next generation VIA chip will do a better job.

Update: As jkkmobile points out, the Asus Eee PC 901 is perfectly capable of playing 1080p video. So maybe VIA is using a faulty Eee PC 1000H, perhaps they underclocked the computer, or maybe’t it’s running unplugged, which I understand would also decrease the clock speed. Anyway, while it’s nice to see that the Nano can play 1080p video, it seems that this video might be a bit disingenous.

Update 2: VIA’s Tim Brown responds that the Eee PC 1000H was running on battery power and that the company wasn’t trying to pull anything, but rather to show how two similar machines handled the same task. Did he really not know that plugging the computer in would yield different performance? Does that matter? Maybe not. But the video probably should have stated the fact that the PCs were running on batteries.