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Apple rumored to buy ARM Holdings

post #1 of 155
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Apple is reportedly interested in acquiring ARM Holdings, the Cambridge England firm that licenses the majority of the world's mobile chip designs.

According to a report by the London Evening Standard, "Apple is ARM's biggest customer and speculation is that the iPad maker wants to take chip design in house."

After noting that shares in ARM had "shot up 8.1p to 251.1p," the report cited a trader as saying, "A deal would make a lot of sense for Apple. That way, they could stop ARM's technology from ending up in everyone else's computers and gadgets.

The report added "traders reckon a bid would come in at around 400p a share, valuing ARM at more than £5.2 billion [$8 billion US]."

Apple originally founded ARM in a 1990 partnership with UK computer maker Acorn and chip fab VLSI Technologies. At the time, Apple was interested in adapting Acorn's new RISC processor for use as a mobile processor in the company's new Newton Message Pad.

As Apple discontinued the the Newton line in the late 90s, chief executive Steve Jobs began selling Apple's shares of ARM in an effort to balance the company's books. Apple returned to ARM processors with the iPod in 2001, and has consistently used ARM processors ever since in its iPods, recent AirPort wireless base stations, the iPhone, and iPad.

Apple appears to have acquired chip designer Intrinsity in order to accelerate the ARM Cortex A8 to 1GHz speeds. Were Apple to buy ARM, it could leverage a great deal of power over the market for mobile and embedded processors chips, the vast majority of which are based on licensed ARM designs.

Currently, Apple pays royalties for ARM's chip designs used in its products. If the company acquired ARM, it could conceivably raise licensing costs to rivals or even take ARM designs off the market. Competitors to ARM in the mobile arena, including Intel's Atom processor family, are not nearly as power efficient.

Similar to Intrinsity and PA Semi, ARM only licenses its chip designs and technologies to other companies that actually build the chips.
post #2 of 155
Two Words:

Do It!
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post #3 of 155
Quote:
Originally Posted by MsNly View Post

Two Words:

Do It!

One word:

Amen!
post #4 of 155
Holy sh*t! Wouldn't this just shake up the entire mobile industry! Having to license from Apple!
post #5 of 155
Yes! Do it Apple!
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post #6 of 155
The plot thickens..
post #7 of 155
Quote:
Originally Posted by GregoriusM View Post

Holy sh*t! Wouldn't this just shake up the entire mobile industry! Having to license from Apple!

And, even better, having Apple say, "No thanks. These are ours. Get your own."
post #8 of 155
Apple keeps moving!!! On to the next one!!! 
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post #9 of 155
Question, does ARM actually manufacture the processors themselves?

I ask only that this could make Apple's mobile devices even more cost effective AND allow them to make super secret squirrel processors without the need for external printing factories.

I've said Apple should do this themselves and if this really is the case Apple is going to produce even more amazing things. The best way to ensure everything is perfect is to do it yourself.

If they print their own processors could they also make their own solid state drives?

The potential for something like this is astronomical.
post #10 of 155
Jobsinator, Get'r done!!!
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post #11 of 155
Quote:
Originally Posted by DCJ001 View Post

And, even better, having Apple say, "No thanks. These are ours. Get your own."

YES!!!

Quote:
Originally Posted by lowededwookie View Post

Question, does ARM actually manufacture the processors themselves?

No, I they're just a IP company, hence the name ARM Holdings.

Quote:
Originally Posted by Wikipedia

Unlike other microprocessor corporations such as AMD, Intel, Freescale (formerly Motorola) and Renesas (formerly Hitachi and Mitsubishi),[27] ARM only licenses its technology as intellectual property (IP), rather than manufacturing its own CPUs. Thus, there are a few dozen companies making processors based on ARM's designs. Intel, Freescale and Renesas have all licensed ARM technology. In 2007, 2.9 billion chips based on an ARM design were manufactured.[28]
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post #12 of 155
Quote:
Originally Posted by lowededwookie View Post

Question, does ARM actually manufacture the processors themselves?

I ask only that this could make Apple's mobile devices even more cost effective AND allow them to make super secret squirrel processors without the need for external printing factories.

I've said Apple should do this themselves and if this really is the case Apple is going to produce even more amazing things. The best way to ensure everything is perfect is to do it yourself.

If they print their own processors could they also make their own solid state drives?

The potential for something like this is astronomical.

No, they are the holding company. They give the rights to companies to use the tech. Intellectual Properties.
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post #13 of 155
ARM has one of the best business models in the business. All they do is create the designs, and sell them to others, who then have to invest in actually building those chips.

That being said, I can't see how Apple would prevent a PA Semi style outflow of engineers if they acquired ARM? I think it would not be smart of Apple to stop them from selling to competitors (for employee morale, as well as anti-trust reasons). A better idea might be to continue selling designs to 3rd parties, but getting a 3-6 month lead in development time (in the mobile industry this is huge, since its half the life-cycle of a phone).
post #14 of 155
I don't buy the whole " spend billions to keep others from having it" ethos.
I think Apple realizes that ARM is "the" platform for mobility going forward and
they are investing heavily themselves. If they are investing themselves then why
not make a little money and influence the design of mobile platforms going forward.

I think this is less about thwarting competition and more about Apple becoming the "Intel" of mobile computing (in dominance)

Intel's not going to have Atom as a viable successor for years if at all but ARM will grow its MP core business to attack Atom in the Netbook class sector.

It behooves Apple to not only maintain current clientele but keep them happy and move forward with improved designs and tools.
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post #15 of 155
Apple should build their own manufacturing plant.

Then they could make their own processors as well as ARM processors so then they could make double profits from licensing with this buyout and selling from their own plant. They'd make their money back easily.
post #16 of 155
Don't do it.
post #17 of 155
shouldn't have been in such a hurry to sell all those shares in 1999 i guess, after the newton got steved. apple could have saved a couple of billions. a billion here, a billion there, soon you're talking real money!
post #18 of 155
Apple needs to remember what business it is in... What it excels at!

I have no doubt that Apple will-- if Apple were to buy ARM, it would be to advance Apple products, not to lock out others or to squelch competition... They don't believe that they have any real competition at what they choose to do.

However, they are savvy enough not to let others put them at a competitive disadvantage by constricting their access to technology...

.
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post #19 of 155
Quote:
Originally Posted by AppleInsider View Post

Apple is reportedly interested in acquiring ARM Holdings, the Cambridge England firm that licenses the majority of the world's mobile chip designs.

According to a report by the London Evening Standard, "Apple is ARM's biggest customer and speculation is that the iPad maker wants to take chip design in house."

After noting that shares in ARM had "shot up 8.1p to 251.1p," the report cited a trader as saying, "A deal would make a lot of sense for Apple. That way, they could stop ARM's technology from ending up in everyone else's computers and gadgets.”

Where has this trader been? ARM's technology already is in everyone else's computers and gadgets, at least the pocket sized ones. As such, I don't see this getting past the anti-trust boards, if it even gets that far.
post #20 of 155
iAd = ARM purchase?

we need to spend some money...how can we make more!

do it.
post #21 of 155
Quote:
Originally Posted by DCJ001 View Post

And, even better, having Apple say, "No thanks. These are ours. Get your own."

that doesn't make a lot of sense. arm is obviously making money from licensing their chip design. it would be a no-brainer to keep that coming in, and i'm sure that their current customers have some pretty air tight contracts. i'm definitely not qualified on the legal implications, but i think that would be the kind of thing that would invite an investigation over anti-competitive behaviour.

anybody more qualified to comment on this?

this seems to me to be more of a strategic move to acquire intellectual property, possibly even to strengthen apple's bargaining position for one of the ongoing ping-pong lawsuits.
post #22 of 155
Sorry, it won't happen.

The fear that Apple will make ARM instruction proprietary and lock out competitors could run the ire of the Department of Justice Antitrust Division in the USA and the European Union antitrust regulators, and that will kibosh the deal in no time flat.
post #23 of 155
This is a bad rumor. It won't happen. Total nonsense.
post #24 of 155
Apple buying ARM IMO raises no more of a stink than

HP and Compaq merging
Adobe acquiring Macromedia

etc.

Apple didn't get to where they are by throwing good money out the window. ARM's licensing is of direct value to Apple as well as their expertise.

In fact with Intrinsity onboard they will be able to goose the cores up to ridiculous levels and make hay with the current licensees.

There's a reason why they snapped up Intrinsity. No one else can take a Cortex A8 beyond 650hz. Apple knows they have a gold mine here to license.

Ca'ching! Cash registrers are going off.
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post #25 of 155
Quote:
Originally Posted by SactoMan01 View Post

Sorry, it won't happen.

The fear that Apple will make ARM instruction proprietary and lock out competitors could run the ire of the Department of Justice Antitrust Division in the USA and the European Union antitrust regulators, and that will kibosh the deal in no time flat.

Totally unfounded. When Apple bought PA Semi people said the same thing but everything blew over and no one got screwed.
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post #26 of 155
I have no inside information but something tells me Apple and Intel are currently deadlocked in intense negotiations and Apple is using it as a ploy to gain leverage.

Last week Apple was in talks with AMD, this week they're buying ARM. Something smells fishy. \
post #27 of 155
Quote:
Originally Posted by MJ Web View Post

I have no inside information but something tells me Apple and Intel are currently deadlocked in intense negotiations and Apple is using it as a ploy to gain leverage.

Last week Apple was in talks with AMD, this week they're buying ARM. Something smells fishy. \

Intel has no play here. Atom isn't a mobile phone architecture and won't be for a while. Apple can print money here.

They have the PA Semi IP and a lot of talent left over and it appears they've got Intrinsity. They can print money with this acquisition and set the market. Not by withholding products from competitors but rather barring other solutions from gaining any traction.
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post #28 of 155
For Apples sake, lets hope Google doesn't swoop in and jack it for Android before Apple can close the deal.

We have all seen Googles willingness to swoop in and jack a deal when Apple is on the move.
post #29 of 155
Quote:
Originally Posted by MsNly View Post

YES!!!



No, I they're just a IP company, hence the name ARM Holdings.


As business entities go, it's a wonderful pun, too.
post #30 of 155
Quote:
Originally Posted by hmurchison View Post

Totally unfounded. When Apple bought PA Semi people said the same thing but everything blew over and no one got screwed.

This one's more difficult though. Could Apple have two design departments? One designing cores for the general market as ARM does now, and another designing cores just for themselves (leveraging the other department's designs)? It would be tricky.

Would customers think that Apple was keeping the best IP for themselves deliberately? Of course, third parties could always rework the designs as they do now. But you've got to wonder. Would they think that Apple has left "holes" in the designs that will cause them problems? Not saying it would happen, but they could think it.

Maybe Apple should just invest in a big chunk of it, but not enough for voting control.
post #31 of 155
Buy ARM Holdings and move the Mac to ARM in a few years! This is of course a wild claim, but how about a 50 core ARM processor using GCD for load balancing? Apple has a lot of control over the software stack to make this happen. Execution unit density could be much higher with this configuration. It could also be more energy efficient because cores can be turned off. The iPad runs so cold, i bet they could pack a lot of silicon in there without overheating issues.

On second thought, maybe it isn't so wild. It would give Apple a huge competitive advantage that Microsoft couldn't touch because they have too many hardware partners. There is obviously a lot of interest in this type of design if you look at others out there like the Sony Cell. It would be great for some of Apple's existing markets too: Super Computers, Video Encoding, and Graphic Design.
post #32 of 155
Quote:
Originally Posted by melgross View Post

This one's more difficult though. Could Apple have two design departments? One designing cores for the general market as ARM does now, and another designing cores just for themselves (leveraging the other department's designs)? It would be tricky.

Would customers think that Apple was keeping the best IP for themselves deliberately? Of course, third parties could always rework the designs as they do now. But you've got to wonder. Would they think that Apple has left "holes" in the designs that will cause them problems? Not saying it would happen, but they could think it.

Maybe Apple should just invest in a big chunk of it, but not enough for voting control.

So what if Apple leaves "holes" in the design.
Nothing would stop anyone from starting up their own company and designing their own chips.

Now, if Apple went to Samsung and said "don't manufacturer these other chips or you cant manufacture ours" you might have an argument.
post #33 of 155
Quote:
Originally Posted by addicted44 View Post

ARM has one of the best business models in the business. All they do is create the designs, and sell them to others, who then have to invest in actually building those chips.

That being said, I can't see how Apple would prevent a PA Semi style outflow of engineers if they acquired ARM? I think it would not be smart of Apple to stop them from selling to competitors (for employee morale, as well as anti-trust reasons). A better idea might be to continue selling designs to 3rd parties, but getting a 3-6 month lead in development time (in the mobile industry this is huge, since its half the life-cycle of a phone).

The best reason for Apple to buy ARM would be because it gets rid of the licensing cost to Apple. They could still license the tech to others, at current rates, to avoid upsetting the market too much. But Apple would have a competitive advantage of not having to pay the licensing costs for ARM's designs.
post #34 of 155
Quote:
Originally Posted by AppleInsider View Post

"A deal would make a lot of sense for Apple. That way, they could stop ARM's technology from ending up in everyone else's computers and gadgets.

The report added "traders reckon a bid would come in at around 400p a share, valuing ARM at more than £5.2 billion [$8 billion US]."

If they stopped ARM technology from ending up in everyone else's computers and gadgets that would massively reduce ARM's revenue and it would no longer be worth 8 billion.

It also wouldn't affect the competition in the short term as they already have licenses to use ARM technology (just like Apple does). Longer term there are alternatives like the Intel Moorestown System-on-Chip. The new Intel platform is much more power efficient than their previous offering.

Strikes me as rather a waste of 8 billion dollars.
post #35 of 155
Quote:
Originally Posted by melgross View Post

This one's more difficult though. Could Apple have two design departments? One designing cores for the general market as ARM does now, and another designing cores just for themselves (leveraging the other department's designs)? It would be tricky.

Would customers think that Apple was keeping the best IP for themselves deliberately?

That would be considered competitive advantage. And Apple does keep the best (nearly ALL) IP for themselves currently anyway, so what would be the surprise?
post #36 of 155
Quote:
Originally Posted by hmurchison View Post

Apple buying ARM IMO raises no more of a stink than

HP and Compaq merging
Adobe acquiring Macromedia

etc.

Apple didn't get to where they are by throwing good money out the window. ARM's licensing is of direct value to Apple as well as their expertise.

In fact with Intrinsity onboard they will be able to goose the cores up to ridiculous levels and make hay with the current licensees.

There's a reason why they snapped up Intrinsity. No one else can take a Cortex A8 beyond 650hz. Apple knows they have a gold mine here to license.

Ca'ching! Cash registrers are going off.

Or Compaq and DEC merging... or Oracle and SUN merging... Lots of more significant examples...

Speaking of SUN... who is Apple going to acquire for a new filesystem? Their ZFS plans got screwed and Apple didn't even put up a fight... they must have something planned...
post #37 of 155
Quote:
Originally Posted by Patranus View Post

So what if Apple leaves "holes" in the design.
Nothing would stop anyone from starting up their own company and designing their own chips.

Now, if Apple went to Samsung and said "don't manufacturer these other chips or you cant manufacture ours" you might have an argument.

Considering that most of the industry uses these designs, that wouldn't be sustainable.

You know, just because we're Apple users doesn't mean that we can think that anything that Apple MAY do would be ok. If another company did that to Apple, you would be among the first up and screaming about how unfair it is.
post #38 of 155
Quote:
Originally Posted by Orlando View Post

If they stopped ARM technology from ending up in everyone else's computers and gadgets that would massively reduce ARM's revenue and it would no longer be worth 8 billion.

It also wouldn't affect the competition in the short term as they already have licenses to use ARM technology (just like Apple does). Longer term there are alternatives like the Intel Moorestown System-on-Chip. The new Intel platform is much more power efficient than their previous offering.

Strikes me as rather a waste of 8 billion dollars.

It depends. Only Apple knows that answer to that. Apple needs to prepare for the next 5 years now. If they need more control over ARM to fit their plans, then it makes sense to buy them. The whole reason to make some of the acquisitions they have made already is to use their "we own the operating system" advantage to move beyond where the market will move on it's own. Otherwise they should have used a snapdragon or hummingbird for their current generation. The market currently isn't set up in a way for the operating system and hardware to change together. To do that things need to move in house. Things will definitely be interesting in the next few years.
post #39 of 155
Quote:
Originally Posted by tawilson View Post

The best reason for Apple to buy ARM would be because it gets rid of the licensing cost to Apple. They could still license the tech to others, at current rates, to avoid upsetting the market too much. But Apple would have a competitive advantage of not having to pay the licensing costs for ARM's designs.

If AMM Holdings cost Apple $8 billion, I don't think the purchase is going to cover the licensing costs.
post #40 of 155
Quote:
Originally Posted by Orlando View Post

If they stopped ARM technology from ending up in everyone else's computers and gadgets that would massively reduce ARM's revenue and it would no longer be worth 8 billion.

It also wouldn't affect the competition in the short term as they already have licenses to use ARM technology (just like Apple does). Longer term there are alternatives like the Intel Moorestown System-on-Chip. The new Intel platform is much more power efficient than their previous offering.

Strikes me as rather a waste of 8 billion dollars.

This is the same problem with buying Adobe
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