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Apr 23, 08 - 07:47 am Comment from: Buster

ohhhhh kewl. Armani processors.

wow I am getting wet!

Apr 23, 08 - 07:51 am Comment from: MadMac

May make this iPhone look like a TRS80 someday.

________________

Posted from my DAY 1 iPhone

A very impressive strategic move... It's a shame that electronic devices are so easily cloned / stolen and or borrowed heavily from. I would buy more Apple stock if I had the dough-ray-me.


-Pi

@buill

Too much information.

I am not so sure I like where this is going. Isn't this the same road Apple has been down before where it tries to be different and use a different processor than the rest of the industry? Did we not see the mac go through this and finally just adopted the x86 from Intel? And what are they going to do by buying the company, compete with Intel? No matter what this firm comes up with, I am confident Intel, with its massive R&D;, can build something just as good. Will we see Apple some day running all phones and iPods on its own chip, everyone else, including the majority of third party developers, running Intel? So which one gets all the third party support?

So others try to copy Apple products. So What? It just means Apple has to innovate and stay ahead. I just don't understand why Apple would go down this road. Let Intel build the processors, concentrate on building the best products.

Maybe they bought it for Intel. Intel will probably have to build them if they need them in quantity. Are gaming consoles using this version of the power pc chip? Slow the growth on that side? Apple looked silly promising 3GHz, what are the people using these chips promising?

THAT SOUNDS GOOD!
nevertheless buying gracenote and audible also would have been a good idea. these are called strategic assets. now they are in the hands of competitors. (sony and amazon)

Seems like Apple pissing away money trying to prove the whole PowerPC fiasco wasn't just one terrible mistake. If a companies the size of IBM and Motorola couldn't keep the Power PC moving forward, what makes Apple think they have a hope on their own?

Theres'278 million Apple's not going to see any return on.

Apr 23, 08 - 08:14 am Comment from: CYxodus

This may have been a move to give Apple better negotiations with Intel. They may have bought the company as a threat to move away from Intel.

Or maybe they're developing a powerful secondary processor. Maybe a full scale graphics chip.

Apr 23, 08 - 08:19 am Comment from: TowerTone

Nice. I like window shopping at boutiques.
Wait......

Fundamental difference between this and the Motorola PowerPC chips issue is that Apple now owns the company that makes the chips and has more control over the innovation. Motorola couldn't keep up with what Apple wanted. A good move in my opinion.

--now they are in the hands of competitors--
Competitors that are making a huge amount of money from the iTunes business. Kill the iTunes biz, and they've got a LONG way to go to make even a percentage of what they're currently making from those properties.

^^ You guys have no idea what you are talking about ^^

Apr 23, 08 - 08:27 am Comment from: Mr. Peabody

PPC was not a mistake, not by a long shot, nor was it a "fiasco". They simply were not keeping up with Apple's needs, especially in the portable computing arena. I think PPC technology still has much more potential than any of Intel's current "innovations", they are just not positioned to be much help to a consumer/mass-market computer maker like Apple. And let's not forget that we shareholders have been nothing short of outspoken about Apple needing to spend some it's excess cash. Right?

On the other hand, maybe someday Apple will be able to think about buying a controlling share of Intel - Hmmm. Now that's something to think about.

278 million is pocket change for the worth they gain in something called...leverage. The speculation and hype surrounding the possibilities of buying this chip is worth 278 million.
Now everyone is scrambling to change the questions they are going to ask at the quarterly earnings call this evening. Maybe even the distraction of this is worth 278 million. ha

To quote Switcher: I am not so sure I like where this is going. Isn't this the same road Apple has been down before where it tries to be different and use a different processor than the rest of the industry? Did we not see the mac go through this and finally just adopted the x86 from Intel?

Yep, Apple did use chips different to Intel x86's in their computers before – from that little known manufacturer IBM.
Gosh, how those chips were really slow! Or do people still believe in the Megahertz myth..?

As long as the computer chip relationship is not changed with Intel,
I think is is cool for Apple to own the chip for the platform it created. Intel can give help as needed without changing any of their process and Apple can develop its own chip in house to work with its iPod and iPhone. Brilliant, actually. Why would Intel object...maybe they suggested it...the more Mac growth, the more Intel makes. Everybody wins!

More proof Jobs is smarter than the great unwashed. THEY want him to blow Apple's cash on Adobe or Yahoo, though neither could provide the returns to justify the investment. In contrast, PA Semi will provide the custom mobile chips to drive the iPhone, Touch and maybe the lowly iPods into the future.

But since they're a *design* firm, they'll still need someone to make the chips. That's an opportunity to bring someone else into the Apple eco-system, if he chooses not to rely on Intel.

Apr 23, 08 - 08:53 am Comment from: DLMeyer

The stock is still "down" ... at about $160 ... so if I call one broker to sell and the other to buy ... ? Oh, wait, there's the transfer wait time. Well, I need to sell anyway ... don't have to buy AAPL. Besides, it usually takes several days for the stock to recover from a semi-random senseless drop.
The chip in the iPhone is not driving anyone's business. Not like the x86 family. Nor will replacing it drive the competition to follow suit. A new lower-power chip may drive sales up, but the niche is somewhat limiting. Nokia isn't going to be driven to switch CPUs no matter how much of the smartphone segment Apple takes. Sure, they can pressure for a lower-power update to what they are using, but that's minor. For less than 5% of their cash-on-hand, Apple has a chance at expanding its iPhone market ... more power to them.

Apr 23, 08 - 08:57 am Comment from: Mr. Peabody

@Raymond in DC,

Ah, good point. So right now it's just as likely that Intel will end up manufacturing the chips that PASemi designs.

Talk about controlling the whole widget, man they are taking this right to the chip level. One step ahead of everyone, again.

How exactly does some little niche company build processors in the quantities that Apple will need- now that they are selling millions of units per quarter? Given that Apple has in the past had trouble getting enough quantity from the big boys?

Maybe they are buying the intellectual property, to be built by Intel or someone else.

Apr 23, 08 - 09:11 am Comment from: HolyMackerel

Note that this is a chip DESIGN company. Apple will still need to get someone else to manufacture it, but I imagine they can play off the various manufacturers (IBM, Intel, Samsung, etc) to get the best price.

Plus Apple control the technology and can take it in directions that others can no longer follow. Even if they drop it in a few years the effect on the bottom line is negligible. More likely they would licence the design to others - sorry, forgot this was Apple!

Apple may be righting old wrongs here, or it may be bringing onboard expertise to tweak power management. Moving back to the PowerPC architecture is a non-starter at this juncture, unless it's for the purpose of creating a gaming device (a la XBox 360, which also uses IBM PowerPC architecture).

I'd like to stay tuned to see where this goes, if anywhere. That's a lot of talent they picked up, with no apparent place to go.

wow, some commenters here are missing the point that Apple's buying a processor design company that has designs for handheld applications. you know, like the iPhone, have you heard of it? Apple's never used Intel x86 chips in its iPods and iPhones. relax, you'll still have Intel chips in your desktops and laptops.

FOR NOW...muh ha ha ha ha ha

Seems that $278m still leaves them with what?, $17,722,000m to spend.

Again Jobs is ahead of the game and leaving everyone guessing.

Love it!

Apr 23, 08 - 09:33 am Comment from: Shadowself

Is everyone forgetting that Apple used to own a significant chunk of ARM?

Apple sold off pieces of their ownership in ARM in order to help their balance sheet in the dark days. The sell off happened after Steve came back, but before the turn around was 100% assured.

How can anyone be surprised that Apple is buying another fabless designer? The only difference this time is Apple has bought 100% of the company.

Given Steve's obsessive need for control, buying 100% of PA Semi (rather than just buying a large interest in it like Apple did with ARM years ago) seems consistent.

Apr 23, 08 - 09:41 am Comment from: Cubert

$278 million in cash!!!

I just hope they didn't meet the guys in a Miami hotel room with a chainsaw sitting in the corner.

Fools, all of you! Think bigger:

Dell laptops shipped with Windows featuring holo-metallic stickers that read: "Apple Inside"

Apr 23, 08 - 09:44 am Comment from: Cubert

@critic,

The funny thing is that buill is a guy!

1. P.A. Semi is fabless. So Apple having in house processor designers might be good for collaboration with Intel. Apple could then own a portion of the design of specialized chips fabbed by Intel preventing Intel from turning around and selling the chips to others.

2. Coprocessors, back in the day the PPC did for a time blow the doors off of what Intel was putting out. Apple putting fast low power coprocessors in it's Computers could boost performance and help differentiate.

3. Apple has plans for a variety of revolutionary handheld devices. These devices must be powerful and there is not better way to assure you have what you need to do the job than to control it. Owning the design of the Processor increases the development cycle especially considering it is based on PPC which Apple is very familiar with.

Apr 23, 08 - 09:51 am Comment from: Logan

A Mac Pro (then Power Mac) with a top shelf quad core PPC is still a work horse force to be reckoned with. I believe its benchmarks aren't that much lower than the top shelf Xeons in current Mac Pros.

The problem seemed to be more with the compact applications of the processor line. In Powerbooks and iBooks the speed was pretty slow. IBM just couldn't keep up with bosting speed / shrinking size. But Apple dropped them long before it became a "fiasco" or "disaster." That said, I would love to see where IBM can take this given enough time.

Apr 23, 08 - 10:04 am Comment from: MCCFR

Think outside the box!

Does PA Semi's knowledge of PowerPC provide something unique? Whilst I was just having a shower, it struck me that PPC was always good at digital signal processing work. Could Apple be thinking of developing a blade-based product which acts as something like a Shake Server?

Who knows?

I meant

3. Apple has plans for a variety of revolutionary handheld devices. These devices must be powerful and there is not better way to assure you have what you need to do the job than to control it. Owning the design of the Processor speeds up the development cycle especially considering it is based on PPC which Apple is very familiar with.

Apr 23, 08 - 10:10 am Comment from: Jubei

This is great news for the iPhone/iPod/Touch platform. 2009 will bring these guys several years ahead of the competition in its capabilities.

a lot of people comparing this to ppc have to remember that arm IS the standard for mobile devices and these would be completely compatible, this is one reason intel is having a hard time breaking in the market.

Apr 23, 08 - 10:12 am Comment from: DogGone

@Hmm

You seem to forget that Apple invested in ARM a while back. Not only did they initiate the handheld revolution but also made a substantial chunk of change in the last 90s when they sold their shares.

This is what Apple do. See exciting technology, buy or support it and the incorporate it into their new units.

Would you prefer they spend 40B on Yahoo! ?

"...just about any imaginable applications Apple's software gurus can imagine."

Brought to you by Brown, Corcoran and Caulfield from Forbes' Department of Redundancy Department.

wow, apple paid over a quarter billion dollars - that´s big bucks.

for those pesky europeans out there, who don´t care to remember the ever falling exchange rate of the greenback: that´s roughly 11 euros, tomorrow it´ll probably be between 8-9 euros.

SCNR

Matt

Apr 23, 08 - 10:37 am Comment from: Dsquare

Baseband is becoming standard in mobile applications where we talk more and more about a "modem". SW rules more and more.. Than LTE is already making a lot of noise....Semiconductor business is a jungle and very difficult for as well technological and commercial reasons...
My two cents: hard to imagine what Apple want to achieve with this "investment", hope for them they make the right choice given the fact that chip design is not their core business...Other phone manufacturers have tried before and failed.

Apr 23, 08 - 11:11 am Comment from: Petey

So, how come Apple missed the deals to buy Audible and Gracenote?

Two missed business buyouts that shouldn't have been missed!

Good to see some of the smarmy, "Just go buy a new Intel Mac" folks getting nervous. PPC is still alive and well.

A new motherboard for G3 iMac - excuse me, soon to be G6 iMac : )

Universal binary, Lloyd, Universal binary

I would love to have another PowerPC. My mirrordoor and tibook still run in an infinitely more stable and reliable fashion than my macbook. On my macbook I have to force-quit apps all the time, and it generally seems to encounter day-to-day problems much more than any of my PowerPCs--both of which are also running Leopard. The thought of a new PowerPC line definitely gets me hot and bothered.

I'll never understand: I still remember the video of a lecture on Apple's site describing why PPC chip architecture was superior to Intel/PC chip architecture (shorter/fewer pipelines, less leakage, more juice with less power, etc.). Then a year later they move to Intel.

"Let Intel build the processors, concentrate on building the best products."

Well, building the best products means you sometimes can't use "off-the-shelf" technology.

Let's turn back the clock to when Apple switched it's personal computers from PowerPC to Intel. Apple was essentially caught between a rock and a hard place. They had IBM on one side, making really fast PowerPC chips (the G5) but there was no way to cram them into a laptop case. They had Motorola making energy efficient G4 chips which were too slow. And neither side was all that interested in Apple's business. IBM was making big money from Sony & Microsoft and Motorola was making big money in the embedded world.

At the time, there was also PA Semi who claimed that they could do what Apple wanted, but they were pretty much untested and Apple couldn't afford the risk.

There was also Intel that was backing away from their Pentium 4 architecture and building new CPUs that were exactly what Apple wanted: Fast, multicore, and energy efficient. The switch was a good idea because for Apple to make the best products, they needed a CPU which was fast, energy efficient, and could be produced in volume.

This is a similar situation. Intels eat too much power. ARMs aren't fast enough. PA Semi comes along with something that is faster and doesn't eat as much power.

And this allows me to have a crystal-clear video phone call with music playing in the background while also displaying my location on a map and not have battery life measured in minutes.

@Switcher

Apple has always done tons of their own electronic engineering. They build their own motherboards, quite often with their own system controller. This has changed a bit since the adoption of Intel, but don't go thinking that Apple buys motherboards from another company. There's a heckuva lot more work that goes into building an electronic device than just the chips themselves. Apple is where they are today because of their deep involvement in every aspect of the process. They don't just assemble the end product like so much of the competition does.

Killing M$ with it's own weapon:

Embrace: switch to Intel
Extend: Windows runs on a Mac
Extinguish: wait for market share to grow past 50% and then pull the plug on Intel

less any one forget that the Mac OS and any developer with a brain- software is still universal binary...PPC and Intel Chip! Apple and Steve is not stupid...Who's ever chip architecture is current and more advanced at the time they can play.... STOP and THINK about it!!! PPC is not dead at all....

My take is that by controlling the chip, Apple can make the iPhone more secure resulting in significantly more difficulty for hackers. When they changed to Intel, security was compromised.

Apparently, Steve thinks that Apple can do a better job than Intel, AMD, IBM, and Motorola designing and manufacturing CPUs.

Maybe Steve wants to design Macs:

(i) with X86 CPUs for Windows, Linux, and/or hybrid Linux-Windows-OS XI users and put the final nail in the Microsoft coffin and,

(ii) return to the roots of RISC to make Macs for exclusive OS XI

I don't think this is as simple as many of you think it is.

A few points:

1) Perhaps this is a defensive move. With the new Intel Atom chips coming out soon, I find it hard to believe that PA Semi could have competed with them on a performance per watt basis at all. It may be that Apple is planning on purchasing the majority of the upcoming Atom processors for use in iPhones, iPods, and perhaps a new device. Intel likes Apple just enough to give them a sizable share of the new Atom chips (which won't enter large-scale production for a while), I would wager. Maybe this acquisition is to keep the PA Semi chips from falling into competing devices, amidst a shortage of Intel processors within the rest of the market. Similar to what they did with the NAND flash market.

2) It is possible that PA Semi may not have wanted to collaborate with Intel on their designs if they were private. Now that they're part of Apple, I bet there would be no problem finding points of collaboration between the PA Semi designs and Intel's upcoming breakthrough low-power chipsets. And guess what! These "collaboration" chips between PA Semi and Intel (which we assume would be superior) could be available ONLY in Apple devices. They could still be branded as Intel chips.

3) A totally different processor like a full-scale graphics chip has interesting implications as well. I'm not exactly sure where other companies are in developing native HD H.264 hardware decoders/encoders, but if Apple/PA Semi could develop something like this, Apple could just put these on their boards in Macs and iPhones and iPods. Imagine Macs that encode 1080P HD H.264 in real time or faster and you can see the potential something like this has to be an explosive force in the market.

In reality, I have no idea what PA Semi is actually working on, or where their specialty lies. However, I do NOT think that this move is in the interest of getting rid of Intel. Apple would be dumb to even consider that, as the Intel chips they're using now are the fastest, coolest, and most efficient processors in the world, and will continue to be for the foreseeable future, and probably beyond.

Comments, questions, concerns?

--mAc