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Apple To Buy ARM?
gyrogeerloose writes "An article in the London Evening Standard claims that Apple has made an $8 billion offer to acquire ARM Holdings. For those few Slashdotters who don't already know, ARM makes the processor chips that power Apple's iPad, iPhone, and iPod Touch. However, ARM processors are also used by other manufacturers, including Palm and, perhaps most significantly, companies building Android phones. This explains why Apple might be willing to spend so much on the deal — almost 20% of its cash reserves. Being able to control who gets to use the processors (and, more importantly, who doesn't) would give Apple a huge advantage over its competitors."
A leg is about 20% of your body mass, so...
-mkb
ARM is one of the better generic processors for embedded and small systems. Apple purchasing them may (read: will) limit the usage of ARM or price them out of the market.
As much as I appreciate what Apple is doing with mobile computing, a move like this (assuming they change the current state of ARM) is going to affect the industry (even markets that do not directly compete with Apple) in a non-positive way.
I hope this doesn't happen, but if it does, I hope they leave the current ISA/availability/pricing scheme alone and just use ARM resources to improve their own products, but that is unlike Apple.
-Will P.
You do know the company was jointly founded by Apple, Acorn and VLSI in the first place?
And it is for this very simple reason that it would be blocked on antitrust grounds. Even if the slightly more lax regulators in the US would permit it, you can bet the Europeans wouldn't (ARM Holdings is based in the UK).
Last week there was a rumor that Qualcomm was going to buy ARM. Now there's speculation about Apple.
It's possible that Steve Jobs took the Qualcomm rumors seriously, and bid for ARM just to make sure that Qualcomm didn't end up buying the company.
http://www.minyanville.com/businessmarkets/articles/arm-holdings-apple-nokia-oem-semiconductors/3/8/2010/id/27176
Ya I don't know why the assumption is that someone else wouldn't step in to the market. Someone like, say, Intel perhaps. Right now, there isn't a ton of interest in new designs in that space because of ARM. They work well, are low powered, and licensed such that they can be implemented cheaply by many people. Intel used to use ARM architecture in their Xscale chips (which are quite popular) before they sold that division to Marvell. As such, there's not a big reason to try and muscle in to the market, you probably aren't likely to make a lot.
However, if Apple decides to play king dick and charge a lot or simply say "Nope, nobody but us can have these chips," well that changes things. It isn't as though all the other mobile phone makers will shrivel up and die, rather they'll look for new hardware and someone like Intel will be happy to provide it for them.
However, that aside, you have to consider that businesses are often very careful about the licenses they make. When licensing an architecture like ARM, they may well get a full architecture license that lets them implement any of the designs they've licensed, in any form, in perpetuity. That sort of contract comes with a company when you buy it. You don't get to throw out their obligations. So while Apple could for sure change new agreements, any of the ones that stand they can't.
There's also the question of how willing companies that do the implementation of ARM, like Marvell, and fabs would be to play ball with Apple. Apple is only a small part of their business. So if Apple suddenly says "Nobody but us can have ARM," maybe Marvell says "Fine we aren't going to sell you any ARM chips." Now Apple has to design the final chip implementation, which isn't the same as the basic architecture. Then maybe the fabs say "Screw you, you've hurt our business cutting off ARM chips, we won't fab your product." Now they have to build or buy their own fab, which is massively expensive.
Hardball can be played multiple ways in the business world and you often find out there is a lot of mutually assured destruction situations out there. I can't see a situation where Apple trying to keep ARM to themselves would do anything but cause a competitor to ARM to arise and be used.
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As has been stated before, Apple has had a relationship with ARM holdings since it was founded (as Apple had equity in the company when it was founded out of the ashes of the Acorn computer company). Apple didn't abuse its position then. Of course, Apple wasn't so big and successful at the time, whereas now it dominates in mobile media players and holds a great deal of market share with the iPhone.
Here is an interesting thing though...history seems to be repeating itself, just with different players. In the 1970s MOS technologies created the 6500 series of microprocessors--the 6502 being the famous, very long lived design. They had a fab and produced their own designs but also ended up licensing the design out to others (the two biggest being Rockwell International and Western Design Center, the latter was founded by a former MOS employee who held a patent on part of the 6502 design that entitled him to a license). Just as the 6502 started taking off in the desktop calculator market Texas Instruments went and started making calculators too--using their own chips that suddenly became much more expensive for third parties.
Jack Tramiel at Commodore was facing possible extinction of his entire electronics line because of the TI-induced shakeout (Older folks, especially from Canada, might remember Commodore as a maker of typewriters and filing cabinets and calulators). Pretty much all calculator makers who used TI chips suddenly found it impossible to compete with TI and those who couldn't re-engineer their designs quickly or rely on other products quickly died (MITS probably wouldn't have been pushed to do the Altair if it hadn't been pushed out of the calculator market by TI). Jack didn't want to fall victim to a bullying chip maker and figured to compete Commodore had to make its own chips like TI, so Commodore bought MOS technology.
Here is an interesting fact: Commodore continued licensing to Rockwell and WDC, and continued to make and sell chips openly on the market, including to direct competitors in the personal computer market. Every single Apple I and Apple II and 8-bit Atari (from the 2600 game up to the 130XE computer) and 8-bit Acorn/BBC Micro was built around a chip design controlled ny Commodore (and maybe even manufactured in their fab). Though Commodore made for a very tough competitor, there is no evidence they overtly abused their position as a chip supplier to dominate the market and in fact Apple and Atari both outlived Commodore. So, it is possible that with Apple owning ARM this scenario could happen again.
So how will history repeat itself? Apple cannot ever revoke current licensees rights to use their current designs, but they could "pull a TI" (even against TI ironically) and either make it very expensive to continue licensing or could refuce to renew, meaning competitors/third-parties could not make NEW ARM-based chips. Alternatively, they could go the "Commodore way" and maintain ARM as a separate (though wholly owned) company that keeps operating as normal, and all our Android phones would be safe.
Of course, Jobs runs the show and being the techno-Nazi that he is might be tempted to go for world domination/industry control by cutting android hardware sales off at the knees. However he is still pretty smart and knows that would be a very bad idea. Consider:
* ARM designs are used EVERYWHERE. Industrial processors, embedded computer systems and so on where Apple doesn't compete--in fact the majority of ARMs revenue relies on non-mobile/wireless business. They'd lose more than they'd gain by shutting out those licensees.
* If they were overtly selective in suppliying chips or licensing their IP to others then they'd face the wrath of antitrust regulators that are much more aware and active in high-tech now.
* They could cut out Android or WinMo hardware makers but both those platforms can be ported quite easily to other hardware. In fact those platforms already run on non-ARM platofrms. Apple could run roughshod over HTC but it