Apple in 'talks with Intel'

Hell not necessarily getting chilly

Analysis Apple is once again rumoured to be close to a deal to build computers based on x86 processors in place of the PowerPC line that has driven the Mac family since March, 1994.

A Wall Street Journal report, published today, cites unnamed industry sources who allege Apple is close to signing a deal with Intel to buy its processors. Neither the Mac maker nor chip manufacturer have commented on the claim.

We've been here before, on many occasions. Apple already buys processors from companies other than IBM and Freescale, its ongoing PowerPC partners, but it uses these chips in its other products, from well-known lines like the iPod to less famous items like Wi-Fi access points. The latter use AMD embedded CPUs, for example.

So it's entirely likely Apple might be pursuing a commercial relationship with Intel. But it does seem implausible that such a deal would see the Mac maker migrate its computers to the x86 processor platform.

The arguments against are well rehearsed, from the advantages of the PowerPC platform - strengthened now that Sony, Microsoft and Nintendo are going to be using PowerPC-based processors in their next-generation games consoles - to the difficulties in persuading software developers to port their apps from the PowerPC instruction set to x86.

On the other hand, Apple has a strong record of managing platform changes, first from the old Motorola 680x0 CPU to PowerPC, then from Mac OS 9 to Mac OS X. And Intel can be a very persuasive partner when it comes to exclusive CPU supply deals: just look at the way it has managed to keep Dell away from AMD all these years.

Apple may well decide there's advantage to be gained in becoming a Dell-like Intel collaborator. Intel may want kudos from backing Mac OS X. But both seem unlikely motivations for a full-scale shift from PowerPC to x86.

More likely, if we're not talking about some sort of embedded processor deal, this is another attempt on Apple's part to gain some leverage over IBM. Much as Dell occasionally lets slip it's talking to AMD - the better, it's believed, to encourage Intel to be more supportive - so Apple may seek to influence IBM by approaching other processor makers.

If it is doing so, it's timing is poor, given IBM's role in three major games console announcements last week. Order volumes from Sony, Nintendo and Microsoft will dwarf Apple's, so the Mac maker has a lot to lose by pushing its processor partner too far.

But does it have anything to gain by shifting to x86? Potentially faster processors, sooner, maybe. But its slim market share has far more to do with its operating system strategy than its choice of hardware. Migrating to x86 might make Macs faster - but probably not - and possibly cheaper too, but it would do nothing to change the compatibility clash with Windows.

The iPod halo effect and the launch of the cut-price Mac Mini will certainly help Apple grow its market share, but it's never going to command a large proportion of the world's desktop and notebook sales. Right or wrong, too many people are too accustomed to Windows.

There might have been a time when Apple could have gained some leverage by shipping Windows-based PCs alongside the Mac, but that time - if it ever existed at all - is long past. You need to be as big as Dell to make a good stab at it these days, hence the Compaq/HP and IBM/Lenovo mergers. That Apple is using cheap Mac hardware - the Mini - to attract Windows users rather than cool-looking Windows boxes, or a standalone version of Mac OS X for x86-based boxes is proof that it doesn't, for now, see a future in x86. ®

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