Apple's PA Semi buyout motivated by assets, not products

Posted:
in Future Apple Hardware edited January 2014
Despite speculation that Apple's acquisition of PA Semiconductor was motivated by the chip maker's specific products, a new report reveals that the iPhone designer is interested more in the buyout for its promises of intellectual property and development expertise -- and may be causing a crisis for the US Department of Defense in the process.



On Monday, just two days before the $278 million buyout was exposed, PA Semiconductor was known to have warned customers that a buyout by a then-unnamed company was entirely disconnected from its existing and future architectures, according to EETimes.



Instead, the buyer (since identified as Apple) is focusing on more abstract intellectual developments and engineering staff, leaving the door open to the use of Intel's Atom platform for future Apple designs.



PA Semiconductor is best-known for developing very high efficiency embedded processors, such as a dual-core, 64-bit PowerPC-based chip that runs at 2GHz but uses only 15 watts of power. While the product itself no longer useful to Apple, which has switched all its computers to Intel's x86 architecture, the achievement itself has drawn attention from since its launch in February of last year by outperforming other rivals in the field while simultaneously running more efficiently.



Nonetheless, Apple's takeover may leave many of those customers -- and the US military -- hanging out to dry, according to an unnamed employee of one of the affected firms.



Though still considered a startup company, PA Semiconductor has already encountered unprecedented success in selling its products and is heavily invested in military technology. More than 10 defense devices, including some from Lockheed Martin and Raytheon, already use the young electronics firm's PWRficient processor to varying levels across every branch of the US armed forces. This bucks conventional industry wisdom, which hesitates to use brand new technology until well-tested.



"I've never seen such fast adoption of a product in the [military aerospace] world," the alleged insider says.



Apple, however, is said by PA Semi to be uninterested in continuing development of those chips and may farm out production on end-of-life terms only if it can transfer a third-party technology license. That will leave many of the smaller company's present-day customers without a long-term source of parts and is already seen as problematic for military contractors like Raytheon, which often spend "many" years developing and maintaining combat equipment.



The risk of an abrupt processor supply cutoff is also reportedly enough that the US Department of Defense may be compelled to plead its case to Apple. No intervention is currently underway, but one is described as possible should PA Semi's customers, and thus DoD part suppliers, grab the attention of the government branch.



"We've had customers saying they are going to the DoD on this one," the source claims.



For its part, Apple remained silent on the reasoning and effects of the acquisition during its second-quarter conference call.
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Comments

  • Reply 1 of 105
    irelandireland Posts: 17,008member
    I personally think they bought them because of the fish.
  • Reply 2 of 105
    chris_cachris_ca Posts: 2,541member
    Quote:
    Originally Posted by AppleInsider View Post


    Though still considered a startup company, PA Semiconductor has already encountered unprecedented success in selling its products and is heavily invested in military technology. More than 10 defense devices, including some from Lockheed Martin and Raytheon, already use the young electronics firm's PWRficient processor to varying levels across every branch of the US armed forces.



    Now every soldier, sailor, marine and airman will have their own tactical communications & media device.

    Think iPhone with satellite & uhf comms, thermal & infrared camera and maps.

    Ability to locate everyone and send messages to individuals/groups directing movements at the lowest level needed.

    If captured or the phone is lost, it can be erased remotely.



    Movies, music, email, websurfing, etc. when on downtime.
  • Reply 3 of 105
    tmedia1tmedia1 Posts: 104member
    Perhaps this chip will be at the heart of a future Newton/Tablet device....



    or the 5G iPhone :<>
  • Reply 4 of 105
    virgil-tb2virgil-tb2 Posts: 1,416member
    All I can say is that if Apple *doesn't* cut itself off from the war industry, I won't be buying another Apple product ever. I know lots of other people probably feel the same.
  • Reply 5 of 105
    Quote:
    Originally Posted by Virgil-TB2 View Post


    All I can say is that if Apple *doesn't* cut itself off from the war industry, I won't be buying another Apple product ever. I know lots of other people probably feel the same.



    Are you confident that Apple doesn't already sell to the "war industry"?
  • Reply 6 of 105
    Quote:
    Originally Posted by delreyjones View Post


    Are you confident that Apple doesn't already sell to the "war industry"?



    lol I am a Marine I deff own a bunch of Apple products. While I was deployed I noticed a trend. Just about every Marine, sailor, solider, and airman has a ipod. Oppsy....
  • Reply 7 of 105
    This actually irritates me a lot, especially since the possibility that Intel is still providing the overheating and power hungry chips are really starting to annoy me a lot. I still stand on my stance of the Intel partnership like I did in 2006. A big mistake in the technical point. If it did go over to P.A. Semi, not only will the processor be a lot power efficient, yet still fast; but also continue competition in the industry instead of continuing to feed an already overbloated giant which thinks that overheating processors are fine. (Idling at 40C is NOT normal!)



    I have been disappointed in Apple ever since their transition to Intel processor. The Macbook would've been even better if only it used less power and won't overheat so much. I could have 8 hours of battery life with P.A Semi's PA6T.



    deltatux
  • Reply 8 of 105
    vineavinea Posts: 5,585member
    Quote:
    Originally Posted by Virgil-TB2 View Post


    All I can say is that if Apple *doesn't* cut itself off from the war industry, I won't be buying another Apple product ever. I know lots of other people probably feel the same.



    Buh bye. I saw ruggedized Mac Minis and Powermacs on Gizmodo years ago. They sell plenty to DoD.
  • Reply 9 of 105
    Quote:
    Originally Posted by Virgil-TB2 View Post


    All I can say is that if Apple *doesn't* cut itself off from the war industry, I won't be buying another Apple product ever. I know lots of other people probably feel the same.



    I dont think you've been here long:

    http://www.appleinsider.com/articles...r_lawsuit.html



    And from forbes:

    http://www.forbes.com/home/technolog..._1221army.html





    P.S. Hey everyone. Been lurking here for a year now and figured it was time to make an account!
  • Reply 10 of 105
    merdheadmerdhead Posts: 587member
    If you wonder where AI gets its super-secret information from, try this article:



    http://www.eetimes.com/rss/showArtic...leID=207401605



    Also, I note they're still pushing their Atom wheelbarrow, although the wheel fell off some time ago. You've got to love their logic - they're buying processor IP and development skills (and if you read the above article you'll see that its not just PowerPC but ARM architecture too) so that they can... use Intel's processor! That's right their going to rework Intel's power hungry, huge, standalone processor, because Intel lets their customers do that. Or at least that's what the geniuses at AI think.
  • Reply 11 of 105
    merdheadmerdhead Posts: 587member
    Quote:
    Originally Posted by Virgil-TB2 View Post


    All I can say is that if Apple *doesn't* cut itself off from the war industry, I won't be buying another Apple product ever. I know lots of other people probably feel the same.



    My god you're right. You should stop using Apple gear of they sell stuff to those death mongers in the military. Aslo I hear Boeing sell airplanes to the military, as do Airbus, so I guess you won't be taking any flights any time soon. And GMC and Ford sell to the military so you'd better stay out of cars (Toyota sell to the Japanese military).



    Also Intel already sell their processors and other ICs to the military, so you've probably already supported the death mongers. Oh the shame.
  • Reply 12 of 105
    ipeonipeon Posts: 1,122member
    Quote:

    Apple's PA Semi buyout motivated by assets, not products



    Speculations... speculations... speculations...



    Let's all speculate, so as to agree upon a speculation, that will still just be a speculation as to why Apple purchased this company. Ya, that will result in truth.
  • Reply 13 of 105
    mdriftmeyermdriftmeyer Posts: 7,100member
    I love the speculation.



    The analogy to Apple's prior purchase for IP and engineering sources that people think only aided OpenGL is truly naive.



    Products take 24 - 36 months to see to fruition.



    Do the math.
  • Reply 14 of 105
    SpamSandwichSpamSandwich Posts: 28,797member
    Quote:
    Originally Posted by merdhead View Post


    If you wonder where AI gets its super-secret information from, try this article:



    http://www.eetimes.com/rss/showArtic...leID=207401605



    Also, I note they're still pushing their Atom wheelbarrow, although the wheel fell off some time ago. You've got to love their logic - they're buying processor IP and development skills (and if you read the above article you'll see that its not just PowerPC but ARM architecture too) so that they can... use Intel's processor! That's right their going to rework Intel's power hungry, huge, standalone processor, because Intel lets their customers do that. Or at least that's what the geniuses at AI think.



    If that's where AI got their info, they need to credit the source. Especially since it's not a secret insider providing information.
  • Reply 15 of 105
    solipsismsolipsism Posts: 25,726member
    Quote:
    Originally Posted by SpamSandwich View Post


    If that's where AI got their info, they need to credit the source. Especially since it's not a secret insider providing information.



    I don't know if I'd say they have credited the source, but they have a link to the source in the article.
  • Reply 16 of 105
    olternautolternaut Posts: 1,376member
    Quote:
    Originally Posted by Virgil-TB2 View Post


    All I can say is that if Apple *doesn't* cut itself off from the war industry, I won't be buying another Apple product ever. I know lots of other people probably feel the same.



    Not me. If anything this would encourage me to buy more Apple products. Imagine if Apple had designed Ironman's power armor!

    In any case, read the article again. This story has nothing to do with Apple doing business with the military....at least in this instance. If they bought PA Semi and Semi had to deliver products to the military Apple will simply fulfill the original orders......thats all.
  • Reply 17 of 105
    Worst case scenario for the DoD would be Apple selling the chip design to IBM, wouldn't it?

    Surely IBM would be happy to have that part of the business?



    Anyway, I wonder what technology/patents/people PA Semi has that's worth $300 million.



    Obviously 150 employees aren't worth $2million each. And if the people weren't going to continue working on something in their own line of expertise they'd leave anyway



    So what technology & patents do they have that are NOT the PWRficient CPU?
  • Reply 18 of 105
    solipsismsolipsism Posts: 25,726member
    Quote:
    Originally Posted by Olternaut View Post


    Imagine if Apple had designed Ironman's power armor!



    • It wouldn't come in red.

    • It would have a glowing Apple logo on the front

    • MS would try to copy it

    • Dvorak would claim Iron Man an enemy of the people to boost page hits

    • There wouldn't be a user changeable nuclear power supply

    • It would be re-spelled iRonMan
  • Reply 19 of 105
    olternautolternaut Posts: 1,376member
    Quote:
    Originally Posted by solipsism View Post


    ? It wouldn't come in red.

    ? It would have a glowing Apple logo on the front

    ? MS would try to copy it

    ? Dvorak would claim Iron Man an enemy of the people to boost page hits

    ? There wouldn't be a user changeable nuclear power supply

    ? It would be re-spelled iRonMan



    lol agreed!
  • Reply 20 of 105
    webmailwebmail Posts: 639member
    Anyone who thinks macs aren't in the military, either doesn't know, or isn't high enough up.



    Macs run things behind the scenes at ALL the major intelligence agencies. The NSA highups/highend groups? All Macs, same with the CIA, FBI, Homeland Security, US Marines, Airforce, Army, Navy.



    Don't be naive, I know about 8 years ago there was a Mac controlling launch of weapon tubes in subs.





    Those big decisions to move 10,000 troops, or divisions? Those are done on a mac, taking inventory of nukes by intelligence agencies? Mac, lots of systems are on mac, and even working for the military most people only see the windows common access card machines and not the real face of the does-the-dirty-work machines. They are mac.
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