TMO Reports - Apple Considering Intel Chips, WSJ Reports

by , 5:30 AM EDT, May 23rd, 2005

Apple Computer has held talks with Intel Corp. to possibly use its chips in future models of Macintosh computers, the Wall Street Journal reported on Monday. Neither company would confirm the report, but one source said the announcement could come at Apple's World Wide Developers Conference, set to begin June 6 in San Francisco.

The report, citing two industry executives with knowledge of recent discussions between the companies, said Apple will agree to use Intel Pentium processors, but gave no further details.

"Talks between Apple and Intel could founder, as they have before, or Apple could be engaging in negotiations with Intel to gain leverage over IBM," the WSJ report said.

It is not known if Apple would use Intel processors together with the Power PC processor, made by IBM, or if the deal with be a dramatic shift entirely to Intel chips.

"Using Intel chips also makes it at least theoretically possible that users could install Windows on Macintosh systems, though it is not clear that Apple will support software other than its Mac OS X operating system," the report said.

One of the two industry executives said Apple isn't likely to market OS X for other PCs. "Instead, the company is likely to package its modified software with its own Intel-based hardware, though it is not clear how the company will prevent users from shifting the software to other machines," the executive told the respected financial daily.

An Apple spokeswoman called the report "rumor and speculation", but did not outright deny it. Apple's "rumor" comment is something it usually only uses when it refers to Mac rumor sites, many of which it has taken legal action against in recent months.

A move to Intel chips, either completely or only in certain situations, could allow Apple to be more competitive in a market where it has been unable to match lower priced Windows-based PCs. Only recently has Apple started to compete in the sub-US$500 PC market, with the announcement in January of its $499 Mac mini.

Rumors of Apple using Intel chips in its computers have long been a subject of speculation. Published reports say Apple toyed with the idea of a Intel-based Mac back in 1992, but chose not to release it. In the past four years, Apple has been working on a version of Mac OS X that would work with Intel processors, sources have confirmed.