Professionals are really suggesting that The apple company may in coming future buy the A-series chips it uses in iPhones and iPads from Intel, complying with a fascinating turn-around by the chipmaker this week, reports Fortune.


Intel has long supplied foundry services in which they construct chips designed by customers, but that service has until now been limited to chips based on its own architecture. As of this week, however, the company has revealed that it will also have the ability to produce ARM-based chips. This would allow Intel to compete with TSMC and Samsung for Apple's iPhone and iPad chip business ...


Apple inc licenses ARM architecture to design its own A-series chips for iPhones and iPads. It has historically commissioned TSMC and Samsung to make these chips, though increasingly moving away from Samsung: TSMC is reported to be the only manufacturer of processors for the iPhone 7, and perhaps also for the iPhone 8.

Intel coming on board as an ARM chipmaker develops two excellent reasons for Apple to think about it as a potential supplier. First, Apple generally likes to have a diversified supply-chain, to stay clear of becoming dependent on a particular supplier. 2nd, commissioning both Mac and iOS device chips from Intel would grant Apple additional negotiating power for both product lines.

" Apple likes diversification in case there is a supply issue," Counterpoint Research director Neil Shah says, noting that Tim Cook is known as a supply chain guru. "Apple can also use it as leverage to bargain Intel chip pricing for its Macs and so forth."

Other analyzers concur that Intel will be targeting Apple's A-series chip business, though noting that it would should work hard on pricing to be competitive-- Apple is renowned for driving hard bargains with suppliers.

" We believe these updates were modest positives and estimate the key customer win that could really move the needle would be a foundry win at Apple," UBS analyst Stephen Chin wrote on Wednesday. "Another uncertainty is how aggressive could Intel be with its foundry pricing to win new customers."

Fortune notes that there are other question-marks also.

ARM has licensed limited capabilities to Intel, so highly-customized designs such as Apple's may not be included. Also, Intel expects to start making 10 nm size chips next year, however it has previously had scheduling setbacks and its latest high-end PC chip family, known as Kaby Lake, is being made at the older 14 nm scale.


Given the lead-times involved in such deals, it is not expected that Intel would remain in a position to produce A-series chips any earlier than 2019. In the meantime, it's been reported that there will be one Intel chip inside the iPhone 7: the LTE modem.

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Mohcine Ariani

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