Just days after I wrote a column saying Apple will dump Intel and make Macintosh computers with its own ARM-based processors, along comes a Wall Street analyst saying no, Intel will be taking over from Samsung making the Apple-designed iPhone and iPod chips and Apple will even switch to x86 silicon for future iPads. Well, who is correct?
Maybe both, maybe neither, but here’s what I think is happening.
Apple is dependent on Samsung for making most of its Cupertino-designed chips, yet Apple has grown to hate Samsung over time, seeing the Korean company as an intellectual property thief. So Apple wants out of the relationship, this much is clear to everyone.
There is only so much semiconductor fab space in the world and Apple is about the biggest customer of all so they can’t go just anywhere and hope to score the 200 million chips per year they need.
Yes, 200 million.
The biggest fabs besides Samsung are TSMC in Taiwan and Intel. There are lots of news stories about Apple talking to TSMC at a time when that company is also massively — and oh, so conveniently — expanding its production capacity. TSMC has the inside track for Apple’s business, we have all been led to believe.
So what’s up with Intel?
Well Intel has excess fab capacity, too, and Intel would very much like to keep Apple as a customer. They can fab Apple’s A5 and A6 chips, sure, especially if it keeps Apple buying i5’s and i7’s for the Mac.
Apple could go with TSMC, they could go with Intel, heck they could go with both, but the fact that they are talking with two companies and probably playing them against each other to get a better deal is kind of a no-brainer, don’t you think?
But what about the part where the iPad goes x86 on us?
I suspect that’s just an Intel fantasy.
“We’ll show you the iPad on x86 will be so much better, let us show you, let us pay for porting the software,” I’m guessing Intel said. After all, that’s exactly what Intel did years before when Apple first considered dumping PowerPC.
It’s exactly the sort of thing that Intel would offer and exactly the sort of offer that Apple would accept because – what the heck — it isn’t costing them anything and it might score another percent or two from TSMC.
But this doesn’t at all mean Apple will dump its own chips for Intel’s in the iPad or any other product line. That would take a design miracle on Intel’s part and it’s been awhile since Santa Clara pulled off one of those.
Apple’s still intent on designing its own future chips, though if the price is right I’m sure they’ll let Intel build them.
The deeper dynamic here is what I find really interesting, though. Intel is rudderless and looking for purpose. Apple is cranky and domineering. What this probably means is Intel will go from being Microsoft’s bitch to being Apple’s.