Apple/PA Semi: Possible Reasons and Military Fallout


Following Apple's acquisition of PA Semi yesterday, and some of the early theories surrounding it, comes word on reaction to the deal, and some more theories as to how Apple may leverage its new technology.

First up, Apple Insider (via EETimes) points out that the Palo Alto semiconductor design firm warned existing companies that:

[A] buyout by a then-unnamed company was entirely disconnected from its existing and future architectures

This bit of news, which is interpreted to mean Apple did not buy the company for its energy efficient PowerPC-based chip designs, wouldn't be using them in upcoming products, and may not continue with previous roadmaps, has sent ripples through PA Semi's current customer base (which includes military juggernauts Lockheed Martin and Raytheon).

Next, Roughly Drafted delves deep into the purchase and comes up with the following: the ability to differentiate their products by developing proprietary hardware components (e.g. for video acceleration, something already prepared for via Core Services), making it harder for others to copy (and clone?) their offerings, while simultaneously getting engineers that specialize in areas Apple values (low level, energy efficient), and have relationships (RD conjectures Texas Instruments, which invested in PA, manufactures their designs) that could benefit Apple.

[P]owered by Intel processors, Apple has seen phenomenal growth in Mac unit sales. That has helped the company amass a $19 billion cash pile that allowed Apple to snatch up the team at PA Semi at a bargain basement price in the midst of a recession. Apple is having its cake and eating it too.

What do you think?

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Rene Ritchie

EiC of iMore, EP of Mobile Nations, Apple analyst, co-host of Debug, Iterate, Vector, Review, and MacBreak Weekly podcasts. Cook, grappler, photon wrangler. Follow him on Twitter and Google+.

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Reader comments

Apple/PA Semi: Possible Reasons and Military Fallout


1) as a fab, TI leaves much to be desired.
2) apple has long designed its own ASICs for things.
3) most of the engineers will leave

No clue. Perhaps they have some nice patents? The "TI relationship" consists of "here's some money and a chip mask. send us the fabricated chips."
The good engineers will definitely leave (many already have, from what my friend tell me). Dobberpuhl, himself, is worth something, I suppose, but not that amount of cash.