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In simple terms, it is the number of bits of data an ALU can process at a time.
For example, 8 bit microcontroller has an 8 bit ALU. If the data register of any such
microcontroller are more or less than 8 bit, they are made 8 bit by segmenting or rounding
off before processing data in ALU.
The simplest 8 bit microcontroller architectures have mostly the 8 bit data registers and 8
bit data bus to avoid circuit complexity.
A microcontroller is a device that usually packs a CPU, some memory and a few peripherals
(GPIO, ADC, DAC, UART, I2C, SPI, etc) in one chip.
All the components mentioned above need to communicate with each other in order to
make the device work. An 8-bit microcontroller uses instructions that are 8-bits long which
could be a limitation for some applications since you’d only have 256 (2828) possible
instructions. Also the size of the memory, memory addresses, data bus and the registers are
8-bits wide which can be limiting for some applications. Nonetheless, there are ways of
manipulating the data to fit 16-bit integers, and many 8-bit microcontrollers have 16-bit
address buses to be able to use more memory.
Microcontrollers are like small computers that can carry out small
programs and are often used for automation and robotics. The
most popular to those who are just starting out are 8 bit and 16 bit
microcontrollers. The main difference between 8 bit and 16 bit
microcontrollers is the width of the data pipe. As you may have
already deduced, an 8 bit microcontroller has an 8 bit data pipe
while a 16 bit microcontroller has a 16 bit data pipe.
Summary:
16 bit microcontrollers have twice as long data pipe than the 8 bit
microcontroller