The Flycatcher chips cost just 30 pence each and measure less than a millimetre square.
ARM'S tiny microprocessor is the most energy efficient in the world and works on ultra-low power, according to the UK firm.
The chips will power machine-to-machine (M2M) communication or "The Internet of Things".
The Flycatcher will help slash your energy bill by making fridges run better, appliances talk to each other and preserve precious water reserves. They could be placed in parking meters, allowing for one touch payments of parking fees.
The Huffington Post spoke to Richard York at ARM, in Cambridge, who said: "To make the internet of things work, you need tiny, cheap chips, and that's what we've managed to create.
These are so small and affordable, they could be in every machine and appliance you have. They could mean your washing machine and dishwasher know to turn on when energy is cheapest, or make fridges much more efficient, telling the motor when to turn on."
The ARM® Cortex™-M0+ processor could be placed in irrigation pumps, allowing farmers in developing countries to precisely manage the water they use on crops.
“The Internet of Things will change the world as we know it, improving energy efficiency, safety, and convenience,” said Tom R. Halfhill, a senior analyst with The Linley Group and senior editor of Microprocessor Report. “Ubiquitous network connectivity is useful for almost everything - from adaptive room lighting and online video gaming to smart sensors and motor control. But it requires extremely low-cost, low-power processors that still can deliver good performance."
ARM is just one of the well-established British businesses exporting tech products or knowledge without drawing huge amounts of attention. It designed then licensed this chip, and says it has launched multiple millionaires through its labs in Cambridge.
ARM was valued at $6 billion in 2011, according to The Inquirer, and can count Microsoft and Apple as two of its licensees.
Its processors are currently in 100% of smart phones sold, yet it trundles along quietly, and rather successfully in the Silicon Fens, while tech start-ups in Old Street London draw most of the attention.