Apple Looking to Design Its Own Chips

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Recent signs indicate that Apple may be looking to design computer chips for its own devices as early as next year. With its own chips, the company could potentially create Apple-only features, but -- perhaps more importantly -- it could also keep Apple's product plans secret from its competitors, according to The Wall Street Journal.

Some features that Apple may be looking to improve with its own chips include energy efficiency, graphics capability for gaming and high definition video, handwriting technology, and display management. But what's really could be of concern is the increasingly common information leaks about Apple's plans based on rumored contracts with outside suppliers and the company's buying patterns. So far, those rumors have only helped increase product hype for Apple, but with so many product rumors flying around eventually one may come back to haunt Apple.

There's also the concern that technology developed for Apple by a third-party could be sold to Apple's competitors. That's not an uncommon event, and already happened with the Merom chip Intel developed for the MacBook Air. Intel also introduced another reduced-size processor shortly after the MacBook Air debuted in 2008. Apple may also be concerned that any customizing it does on existing chip designs from third-party suppliers could be shared with other companies, according to the Journal.

We've heard rumblings for some time that Apple could be going after its own chip designs. Last April, Apple bought P.A. Semi a chip designer that makes "energy-efficient processors based on the Power architecture that Apple used in its Macintosh computers for many years before adopting Intel's x86 chips." When Apple acquired P.A. Semi, many analysts discounted the notion that Apple would design its own chips. The analysts pointed to Apple's relationship with Intel -- the current supplier of Mac processors -- as being very strong and that Apple was merely buying talent to customize chip design for future Apple products and not to design its own chips.

Since then there have been other signs of Apple's interest in computer chips: in December 2008 the company picked up a 3.6 percent stake in Imagination Technologies, a graphics chip maker; and Apple recently hired Bob Drebin as a Senior Director. Drebin has a long history in the computer chip industry, serving as Engineering Director for the graphics card maker ATI Technologies until that company was bought out by Advanced Micro Devices, when he became the chief technology officer of AMD's Graphics Products Group. The Journal says Apple also recently hired Raja Koduri, another former technology officer at AMD.

Apple is also currently on a hiring spree for top chip-making talent. The company has listed several job openings on its Web site that have to do with chip design, including a posting for an SOC SW Test Development Engineer, which lists the engineer's main responsibility as "verifying the functional correctness and optimizing the coverage of Apple developed silicon." The Journal reports that Apple has also listed several jobs on the professional social network LinkedIn, and Apple representatives recently took part in a job fair for engineers whose jobs will soon disappear at Spansion Inc. Spansion, a flash memory chip maker, in February announced plans to lay off more than 3000 employees and then in March Spansion filed for bankruptcy.

While Apple is looking to pull in chip-making talent, the company isn't immune to the current recession. In March, a rumor came out that layoffs at Cupertino were imminent, then earlier this week it was discovered that Apple had reduced its retail staff by more than ten percent.

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