or Connect
AppleInsider › Forums › Mac Hardware › Future Apple Hardware › Intel would consider making custom chips for major customers like Apple
New Posts  All Forums:Forum Nav:

Intel would consider making custom chips for major customers like Apple

post #1 of 36
Thread Starter 
An executive with chipmaker Intel said on Thursday that his company "wouldn't blink" if given the opportunity to build a custom chip based on the Intel architecture for a major client like Apple.

Intel Chief Financial Officer Stacy Smith made the comments on Thursday at an investor event in London. According to Reuters, he said his company would be happy to produce custom chips based on Intel's own architecture, though they would be less willing to allow rival architectures, like ARM, in their plants.

"If Apple or Sony came to us and said 'I want to do a product that involves your IA (Intel architecture) core and put some of my IP around it,' I wouldn't blink," he reportedly said. "That would be fantastic business for us."

He said for chips not based on the Intel architecture, and for custom-designed cores like the A5 processor found in Apple's iPad 2, his company's only financial gain would be the manufacturing margin. In that case, he said Intel would need to engage in "a much more in-depth discussion and analysis," though he did not entirely rule out the possibility.

Smith went on to say that Intel has made some "tiny" foundry deals in the last year, largely to access new technology. However, proposals from major device makers like Apple are not yet in the works.

He also said the prospect of making chips for others was not the driving force behind Intel's continuing investments in capacity. But the comments make it clear that Intel would jump at the chance to work with Apple on custom processors based on the Intel architecture for systems such as Mac computers.



As for the ARM-based processors Apple uses in its mobile devices, a report from earlier this month claimed that Intel has shown interest in building chips like the custom A4 and A5 to compete against foundries like Samsung. Intel currently makes the CPUs that power its notebook and desktop Mac lineup, but has turned to ARM processors for devices including the iPhone, iPad, iPod touch and Apple TV.

Intel worked with Apple in creating the new high-speed Thunderbolt port found on the latest MacBook Pros and iMacs. It was Apple's close involvement in the project that gave the Cupertino, Calif., company first access to the next-generation technology.
post #2 of 36
Quote:
Originally Posted by 5waltersm1 View Post

sometimes it surprises me how much companies like apple affect companies like Intel as they are both massive companies neither which 'struggling' but i suppose any company will jump at the opportunity for more profit

Intel realizes about 2 years too late that it's out-of-the-loop on the single largest profit focus--smartphones and tablets.

ARM is only going to advance it's positions it currently dominates and take on more of Intel's traditional markets.

Apple doesn't give a rat's behind what Intel would offer. In the embedded space Apple has billions invested and it controls the IP and there are several foundries that can meet their demand, even if Samsung gets dropped.
post #3 of 36
The problem is: Nobody wants IA chips in the post-PC devices. Not even custom-made ones.

Now, an Intel-manufactured chip with ARM architecture. That would be very yummy...
post #4 of 36
Would be nice for Macs to have their own architecture again and end the Hackintoshs.
post #5 of 36
Quote:
Originally Posted by bedouin View Post

Would be nice for Macs to have their own architecture again and end the Hackintoshs.

Really? I don't own a Hackintosh but this intel thing has been awesome for Apple.
post #6 of 36
Isn't it interesting that Intel's biggest strength in the desktop market, backwards Windows compatibility, is its biggest weakness in the mobile market? I have been openly speculating about what the performance and power usage of an Arm processor would be like if it were made with Intel's latest fab process.

If I was Intel, I would move mountains to purchase Arm. Intel needs to be in the leading position of CPU design. They are very good at it. Unfortunately they are being held back by the need for backwards compatibility and their CISC architecture. Even Microsoft seems to be less interested in backwards compatibility these days with their announcement of an Arm version of Windows. As an individual user, backwards compatibility is not very important now that I can buy new apps for a few dollars.

Wintel has finally run its course. I see it becoming less and less important compared to mobile, embedded and cloud computing processors.
post #7 of 36
Quote:
Originally Posted by bedouin View Post

Would be nice for Macs to have their own architecture again and end the Hackintoshs.

If you can't comment on the article at least use complete sentences and/or try not sounding like a whinny moron.

Thanks.
post #8 of 36
I can understand Intel not being too interested in doing foundry work for others if the production was small. Small being on the order of hundreds of thousands to in the low millions. Then the profit would be small. as they mentioned.

But, Apple will need a good 200 million chips in 2012. Being that these are all the same chips, except for the speed sort that Apple uses, running the iPhone slightly slower than the iPad, and possibly the Touch, Intel would benefit from the enormous production run. Intel doesn't make more than a fraction of that number of any of its own chips. And as efficiency increases in chip production the further down the road you get with a chip, they would have increasing profits as the year went on.

The estimate is that Apple is paying about $25 per A%, as opposed to a cost of $15 for the Tegra 2. 200 million of those chips, if Apple paid intel what they pay Samsung, would be $5 billion dollars. That's a significant portion of their total sales, which last year was $43.6 billion.
post #9 of 36
Intel saying this can only be seen as a positive for Apple moving forward. They either work out a deal with Intel that is better for them, or they get a better price from their current chip maker in fear that they will leave for Intel.

As has become standard over the last couple of years Apple holds most of the cards sitting at the negotiating table.
post #10 of 36
Sure, anything for the famlly jewels.
post #11 of 36
The margins on fab are nothing compared to the margins on chips housing your own intellectual property. Intel's position is that of a fully rational capitalist.
post #12 of 36
Quote:
Originally Posted by GrangerFX View Post

Isn't it interesting that Intel's biggest strength in the desktop market, backwards Windows compatibility, is its biggest weakness in the mobile market? I have been openly speculating about what the performance and power usage of an Arm processor would be like if it were made with Intel's latest fab process.

If I was Intel, I would move mountains to purchase Arm. Intel needs to be in the leading position of CPU design. They are very good at it. Unfortunately they are being held back by the need for backwards compatibility and their CISC architecture. Even Microsoft seems to be less interested in backwards compatibility these days with their announcement of an Arm version of Windows. As an individual user, backwards compatibility is not very important now that I can buy new apps for a few dollars.

Wintel has finally run its course. I see it becoming less and less important compared to mobile, embedded and cloud computing processors.

Apple and several others own a nice amount of ARM.
post #13 of 36
Quote:
Originally Posted by mdriftmeyer View Post

Intel realizes about 2 years too late that it's out-of-the-loop on the single largest profit focus--smartphones and tablets.

I agree that ARM will continue to gain massive traction but Im not so sure about it being the single largest profit focus from Intels PoV. ARM Holding made $665.5 million in 2010 while Intel made 43.6 billion. I dont know the revenue or profit from the foundries that make the chips but I cant imagine that they would amount to single largest profit focus for sometime to come.
Dick Applebaum on whether the iPad is a personal computer: "BTW, I am posting this from my iPad pc while sitting on the throne... personal enough for you?"
Reply
Dick Applebaum on whether the iPad is a personal computer: "BTW, I am posting this from my iPad pc while sitting on the throne... personal enough for you?"
Reply
post #14 of 36
That and Apple by using Intel doesn't have to worry about a non-Intel based supplier falling behind in performance (or the appearance of falling behind). Intel chips also were cheaper then what Apple was paying for a IBM or Motorola supplied processor. Apple doesn't have to foot part of the development cost.

It would be good for Apple though if it could reduce its reliance on Samsung. It would also be nice to bring some jobs back to the US, which having Intel build the chips probably would do.

Quote:
Originally Posted by magicj View Post

I think Apple uses Intel chips on the Mac line so that users can boot into Windows. So that would seem to make the need for custom chips less likely.

On their iPhone and iPad, Apple uses ARM because of their low power consumption compared to Intel. So that would seem to make the need for Intel chips less likely.

Not seeing a spot where it makes sense for Apple to use custom Intel chips.
post #15 of 36
Quote:
Originally Posted by melgross View Post

I can understand Intel not being too interested in doing foundry work for others if the production was small. Small being on the order of hundreds of thousands to in the low millions. Then the profit would be small. as they mentioned.

But, Apple will need a good 200 million chips in 2012. Being that these are all the same chips, except for the speed sort that Apple uses, running the iPhone slightly slower than the iPad, and possibly the Touch, Intel would benefit from the enormous production run. Intel doesn't make more than a fraction of that number of any of its own chips. And as efficiency increases in chip production the further down the road you get with a chip, they would have increasing profits as the year went on.

The estimate is that Apple is paying about $25 per A%, as opposed to a cost of $15 for the Tegra 2. 200 million of those chips, if Apple paid intel what they pay Samsung, would be $5 billion dollars. That's a significant portion of their total sales, which last year was $43.6 billion.

ARM is RISC and Apple's investment into it is not scaling back, but expanding. I like how you fix priced the Apple price for their SoC CPU combo. Sorry, but volume increases dramatically reduce the price to the buyer.

LLVM Project's Clang subproject just added assembly support for Cortex-A{8,9,15}, Cortex-R{4,5,7}, Cortex-M{0,3,4}, ARM11MPCore, ARM1176 in the general Clang tree.

They also just added SSE42_64 CodeGen support into LLVM.

LLVM 3.0 is truly shaping up to being the big break from GCC.
post #16 of 36
Quote:
Originally Posted by TBell View Post

That and Apple by using Intel doesn't have to worry about a non-Intel based supplier falling behind in performance (or the appearance of falling behind). Intel chips also were cheaper then what Apple was paying for a IBM or Motorola supplied processor. Apple doesn't have to foot part of the development cost.

It would be good for Apple though if it could reduce its reliance on Samsung. It would also be nice to bring some jobs back to the US, which having Intel build the chips probably would do.

Intel is the one behind. They are severely behind Apple's A# Series SoC.

Sorry, but Apple's not abandoning the overwhelming amount of recently granted IP for Intel.
post #17 of 36
It is clear you know the difference, but I think it is important to clarify neither Intel or ARM "made" the numbers you report. To me, "made" implies profit. The numbers you are using are gross revenue. That is what Intel and ARM brought in.

The profit for the year for Intel, however, was 4.4 Billion. About a tenth of gross revenue. Arms Holding's profit for the year was about 274 million. Closer to half its gross revenue. So comparatively speaking, ARM keeps a much higher percentage of the gross revenue as actual profit (or spends much less to make its profit).

ARM's number will likely only go up as companies like Microsoft start switching to ARM. Intel as a back plan should seriously start building its foundry business. It would be a win win for Intel and companies like Apple who are looking to escape Samsung.

Quote:
Originally Posted by solipsism View Post

I agree that ARM will continue to gain massive traction but Im not so sure about it being the single largest profit focus from Intels PoV. ARM Holding made $665.5 million in 2010 while Intel made 43.6 billion. I dont know the revenue or profit from the foundries that make the chips but I cant imagine that they would amount to single largest profit focus for sometime to come.
post #18 of 36
Quote:
Originally Posted by solipsism View Post

I agree that ARM will continue to gain massive traction but Im not so sure about it being the single largest profit focus from Intels PoV. ARM Holding made $665.5 million in 2010 while Intel made 43.6 billion. I dont know the revenue or profit from the foundries that make the chips but I cant imagine that they would amount to single largest profit focus for sometime to come.

Who said anything about ARM Holdings. I'm talking about the ARM based CPUs in deployment and the massive revenues made from them.

Apple will have > $100 Billion in 2011 revenues. How much comes from the Embedded Space? Take a guess.
post #19 of 36
My post probably wasn't clear, but I was referring to Intel's chips used in PCs and Macs not the chips Intel wants to be used in mobile devices.

Apple probably would benefit though if it could make a deal with Intel to build Apple's ARM chips. Currently, Samsung is stealing a good chunk of Apple's efforts and using it in its own products.

Quote:
Originally Posted by mdriftmeyer View Post

Intel is the one behind. They are severely behind Apple's A# Series SoC.

Sorry, but Apple's not abandoning the overwhelming amount of recently granted IP for Intel.
post #20 of 36
Quote:
Originally Posted by TBell View Post

It is clear you know the difference, but I think it is important to clarify neither Intel or ARM "made" the numbers you report. To me, "made" implies profit. The numbers you are using are gross revenue. That is what Intel and ARM brought in.

The profit for the year for Intel, however, was 4.4 Billion. About a tenth of gross revenue. Arms Holding's profit for the year was about 274 million. Closer to half its gross revenue. So comparatively speaking, ARM keeps a much higher percentage of the gross revenue as actual profit (or spends much less to make its profit).

ARM's number will likely only go up as companies like Microsoft start switching to ARM. Intel as a back plan should seriously start building its foundry business. It would be a win win for Intel and companies like Apple who are looking to escape Samsung.

I think it cane used in either case so long as you refer to it being the revenue made or the profit made. But thats neither here no their. Do revenue or profits from foundries out perform revenue or profits from Intels X86 foundries.

Melgross comment about the price of the chip is interneting, but I wonder how much the foundry would get? The full $25, but how much to Samsung for RAM and how much to Img Tech for the GPU, etc? Seems like x86 chips would still be Intels biggest money maker.

That doesnt mean I think Intel should ignore this area of business. Im quite happy to read this rumor and hope it comes to fruition.


PS: Could Intel use the 3D Tri-Gate on ARM PoP/SoCs?
Dick Applebaum on whether the iPad is a personal computer: "BTW, I am posting this from my iPad pc while sitting on the throne... personal enough for you?"
Reply
Dick Applebaum on whether the iPad is a personal computer: "BTW, I am posting this from my iPad pc while sitting on the throne... personal enough for you?"
Reply
post #21 of 36
I have no way of knowing the questions you raise, however, the business of producing chips for others must be profitable enough for companies like Samsung to be interested. If things progress the way they have been, more people will buy mobile devices possibly dispensing with laptops. That has to hurt Intel.

Quote:
Originally Posted by solipsism View Post

I think it cane used in either case so long as you refer to it being the revenue made or the profit made. But thats neither here no their. Do revenue or profits from foundries out perform revenue or profits from Intels X86 foundries.

Melgross comment about the price of the chip is interneting, but I wonder how much the foundry would get? The full $25, but how much to Samsung for RAM and how much to Img Tech for the GPU, etc? Seems like x86 chips would still be Intels biggest money maker.

That doesnt mean I think Intel should ignore this area of business. Im quite happy to read this rumor and hope it comes to fruition.


PS: Could Intel use the 3D Tri-Gate on ARM PoP/SoCs?
post #22 of 36
Quote:
Originally Posted by magicj View Post

I think Apple uses Intel chips on the Mac line so that users can boot into Windows. So that would seem to make the need for custom chips less likely.

On their iPhone and iPad, Apple uses ARM because of their low power consumption compared to Intel. So that would seem to make the need for Intel chips less likely.

Not seeing a spot where it makes sense for Apple to use custom Intel chips.

I could definitely see them using custom chips for the Air.
post #23 of 36
Quote:
Originally Posted by foobar View Post

The problem is: Nobody wants IA chips in the post-PC devices. Not even custom-made ones.

Now, an Intel-manufactured chip with ARM architecture. That would be very yummy...

sadely, AMD would be better than Intel in the Arm market i believe, better graphics, better scaling... :s

this is kinda stupid... what would Apple want lol

PC means personal computer.  

i have processing issues, mostly trying to get my ideas into speech and text.

if i say something confusing please tell me!

Reply

PC means personal computer.  

i have processing issues, mostly trying to get my ideas into speech and text.

if i say something confusing please tell me!

Reply
post #24 of 36
I think Custom Chips are referring to Mac, not iPhone or other Mobile Devices that are currently using ARM. Since there are zero benefits for Apple moving to Intel. Intel's LP node are always one node behind, i.e even with 22nm their Low Power Node are still at 32nm. There are certain IPs required for manufacturing SoC outside TSMC, Samsung and GF, and since Intel are making CPU design themselves it is very unlikely those IP owner will allow Intel to see their design.

The only custom part of Desktop CPU i could think of is the GPU part. Apple would properly like to use PowerVR 6 across the whole range of Apple devices, that includes iPhone all the way to the Mac. Since Apple are largely responsible for Drivers, doing so would mean their resources are much better utilise.

And if Intel ever wanted to get rid of the x86 instruction bloat ( MMX, SSE1 etc ) , Apple would properly be the only customer in the world who could pull this off.
post #25 of 36
Quote:
Originally Posted by mdriftmeyer View Post

Apple and several others own a nice amount of ARM.

I think Apple sold off the last of its ARM shares years ago.
post #26 of 36
Quote:
Originally Posted by solipsism View Post

I agree that ARM will continue to gain massive traction but Im not so sure about it being the single largest profit focus from Intels PoV. ARM Holding made $665.5 million in 2010 while Intel made 43.6 billion. I dont know the revenue or profit from the foundries that make the chips but I cant imagine that they would amount to single largest profit focus for sometime to come.

Don't forget though, that companies like TSMC only do fab work, and they're doing pretty well.
post #27 of 36
Quote:
Originally Posted by mdriftmeyer View Post

ARM is RISC and Apple's investment into it is not scaling back, but expanding. I like how you fix priced the Apple price for their SoC CPU combo. Sorry, but volume increases dramatically reduce the price to the buyer.

LLVM Project's Clang subproject just added assembly support for Cortex-A{8,9,15}, Cortex-R{4,5,7}, Cortex-M{0,3,4}, ARM11MPCore, ARM1176 in the general Clang tree.

They also just added SSE42_64 CodeGen support into LLVM.

LLVM 3.0 is truly shaping up to being the big break from GCC.

I didn't fix any price, but Apple is now using 125 million chips a year, and $25 is the price at that level of purchasing. It won't change much going to 200 million. And as the chips get more complex, they get more expensive.

I don't see how anything you mentioned here has anything to do with this.
post #28 of 36
Quote:
Originally Posted by mdriftmeyer View Post

Intel is the one behind. They are severely behind Apple's A# Series SoC.

Sorry, but Apple's not abandoning the overwhelming amount of recently granted IP for Intel.

One thing has nothing to do with the other. Fabs don't "get" the IP of the companies they're fabbing for. I don't know where you get that idea.
post #29 of 36
Quote:
Originally Posted by TBell View Post

It is clear you know the difference, but I think it is important to clarify neither Intel or ARM "made" the numbers you report. To me, "made" implies profit. The numbers you are using are gross revenue. That is what Intel and ARM brought in.

The profit for the year for Intel, however, was 4.4 Billion. About a tenth of gross revenue. Arms Holding's profit for the year was about 274 million. Closer to half its gross revenue. So comparatively speaking, ARM keeps a much higher percentage of the gross revenue as actual profit (or spends much less to make its profit).

ARM's number will likely only go up as companies like Microsoft start switching to ARM. Intel as a back plan should seriously start building its foundry business. It would be a win win for Intel and companies like Apple who are looking to escape Samsung.

Whoa! Where are you getting that Intel number from? You have to be making it up.

Last year, in addition to the $43.6 billion is revenue Intel made, they made $11.5 billion in profit. That's 26.28% net profit margin.

if you want some proof of that, here:

http://money.cnn.com/quote/quote.html?symb=INTC

Then you have the other made up number. That wasn't ARM's profit either. They made $132.7 million in profit, for a 21.14% net profit margin.

Here:

http://money.cnn.com/quote/quote.html?symb=ARMH

Both of these numbers are the reverse of your argument.

How are you coming up with these numbers?

And, for the record, for the purpose of comparison, Apple made $14 billion in profit last year, for a 21.54% net profit margin.

http://money.cnn.com/quote/quote.html?symb=AAPL
post #30 of 36
Quote:
Originally Posted by solipsism View Post

I think it cane used in either case so long as you refer to it being the revenue made or the profit made. But thats neither here no their. Do revenue or profits from foundries out perform revenue or profits from Intels X86 foundries.

Melgross comment about the price of the chip is interneting, but I wonder how much the foundry would get? The full $25, but how much to Samsung for RAM and how much to Img Tech for the GPU, etc? Seems like x86 chips would still be Intels biggest money maker.

That doesnt mean I think Intel should ignore this area of business. Im quite happy to read this rumor and hope it comes to fruition.


PS: Could Intel use the 3D Tri-Gate on ARM PoP/SoCs?

Nobody knows exactly what the split is, but Intel would get the large majority of that, or even all of it, as it isn't clear as to how Apple pays Imagination for its IP.

Well, I imagine that adding 10% to your business, and cementing the relationship with one of your largest, and fastest growing, customers for x86 chips wouldn't be a bad thing.
post #31 of 36
Quote:
Originally Posted by mdriftmeyer View Post

ARM is RISC and Apple's investment into it is not scaling back, but expanding. I like how you fix priced the Apple price for their SoC CPU combo. Sorry, but volume increases dramatically reduce the price to the buyer.

LLVM Project's Clang subproject just added assembly support for Cortex-A{8,9,15}, Cortex-R{4,5,7}, Cortex-M{0,3,4}, ARM11MPCore, ARM1176 in the general Clang tree.

They also just added SSE42_64 CodeGen support into LLVM.

LLVM 3.0 is truly shaping up to being the big break from GCC.

Great! Now When will Xcode 4 be as fast as Xcode 3?
I've accomplished my childhood's dream: My job consists mainly of playing with toys all day long.
Reply
I've accomplished my childhood's dream: My job consists mainly of playing with toys all day long.
Reply
post #32 of 36
Unfortunately unless that custom chip is ARM Apple ain't interested... Edit: I guess the consensus on that is quite clear.
post #33 of 36
Intel has been steadily ramping up capacity, but with The one-two punch of softening PC sales and the take off of mobile devices based on ARM (and MS publicly pledging to support ARM for Windows) they are clearly concerned.
post #34 of 36
While CedarTrail news has been something of a disappointment I dunno why folks don't believe that Apple stays well informed with Intel MID processors and probably has a couple experimental designs around.

It's also not like Intel couldn't resurrect it's ARM CPU business. It still holds an ARM license even after the sale of XScale PXA and they bought Infineon AND they still make ARM processors today. They just call them IO Processors...but these are 1.2Ghz XScale processors from the ARM V5TE family. They might make some Marvell XScale CPUs still but I think these got moved to someone else.

I think they might still be making CE 2110 (Olo River) but these are pretty long in tooth. But they are coupled with PowerVR GPUs. The Intel CE line uses PowerVR quite a bit so it's not like Apple couldn't use Intel for one stop shopping.

If Apple dumps a $500M order on Intel for A5 and A6 production it's only a little bit less than what Intel sold XScale to Marvell for. With the lawsuits with Samsung perhaps Intel or TSMC is a better choice than Samsung anyway.
post #35 of 36
Quote:
Originally Posted by AppleInsider View Post

An executive with chipmaker Intel said on Thursday that his company "wouldn't blink" if given the opportunity to build a custom chip based on the Intel architecture for a major client like Apple.

.

i thought intel was already making chips for apple .


9
whats in a name ? 
beatles
Reply
whats in a name ? 
beatles
Reply
post #36 of 36
Quote:
Originally Posted by melgross View Post

I can understand Intel not being too interested in doing foundry work for others if the production was small. Small being on the order of hundreds of thousands to in the low millions. Then the profit would be small. as they mentioned.

But, Apple will need a good 200 million chips in 2012. Being that these are all the same chips, except for the speed sort that Apple uses, running the iPhone slightly slower than the iPad, and possibly the Touch, Intel would benefit from the enormous production run. Intel doesn't make more than a fraction of that number of any of its own chips. And as efficiency increases in chip production the further down the road you get with a chip, they would have increasing profits as the year went on.

The estimate is that Apple is paying about $25 per A%, as opposed to a cost of $15 for the Tegra 2. 200 million of those chips, if Apple paid intel what they pay Samsung, would be $5 billion dollars. That's a significant portion of their total sales, which last year was $43.6 billion.

$25 bucks each?? are these the pre-payed chips Apple bought last year ??

and 200 million chips ? you say -o- gran poo ah !!

wow so for 2012 that means apple is gonna be selling a lot of ipads and iphones .


bruce p

9
whats in a name ? 
beatles
Reply
whats in a name ? 
beatles
Reply
New Posts  All Forums:Forum Nav:
  Return Home
  Back to Forum: Future Apple Hardware
AppleInsider › Forums › Mac Hardware › Future Apple Hardware › Intel would consider making custom chips for major customers like Apple