Apple, Intel Working on New Venture

Posted on Dec 2 2012 - 7:12pm by John

Apple and Intel are likely brewing another joint venture that would further enhance the processing capabilities of mobile devices such as iPhone and next-generation iPads. RBC Capital markets provided an intriguing idea that would further strengthen the business relationship between the two tech pioneers.

RBC analyst Doug Freedman said Apple might be considering a new deal with Intel, which would require the semiconductor company to produce ARM-based smartphone chips for their mobile devices. Apple, on the other hand, will incorporate Intel’s X86 processors in some of its devices other than their Mac computers, which have been already using Intel’s processors since 2005.

The analysts said the new deal between Apple and Intel may look illogical at first but it will surely allow the iPad and iPhone maker to secure enough capacity and offer much powerful processors on their devices. Moreover, it will further lessen their ties with conductor supplier and tech rival Samsung.

“We believe Intel has the upper-hand due to the limitations of capacity at alternative sources … as the demand is outstripping Apple’s ability to add supply,” said Freedman, who boasted years of experience in working with major players in tech industry.

Meanwhile, another source disclosed negotiations between Apple and Intel have been on and off for the past couple of years for a potential foundry venture. To make this deal work, Apple needs to use Intel’s processors in its next-gen iPad for the semiconductor giant to start manufacturing ARM-based chips.

Apple and Intel remain silent about the negotiations, though the source said both companies are still open for another round of talks.

Apple has been looking for a semiconductor company that would provide them with enough supply of microchips in response to an increasing demand for its smartphones and tablets (iPads and iPad Mini).

Taiwan Semiconductor Manufacturing Company previously emerged as the primary candidate to supply Apple with their chips but the company has already committed with big contracts such as with Nvidia, which complained about the Taiwanese company inability to produce enough supply of chips for their needs.

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