Apple Buys Chip Maker PA Semi

by , 9:30 AM EDT, April 23rd, 2008

Apple revealed late on Tuesday that it has agreed to buy PA Semi, a company that designs embedded microprocessors. Sources close to the deal said the transaction cost the Mac, iPhone and iPod maker US$278 million in cash, according to Forbes.

Apple spokesman Steve Dowling stated "Apple buys smaller technology companies from time to time, and we generally do not comment on our purposes and plans."

Even though Apple isn't commenting on its plans for PA Semi, it seems possible that it could be considering using the chip maker's designs for upcoming products that rely on embedded processors, like new iPods or even the iPhone. If so, that could spell bad news for Intel and its push to convince Apple that the iPhone should be based on its chip sets.

Apple could also be considering licensing the chip designs to other companies since PA Semi's product designs do offer compelling options for electronic devices. The company introduced a 64-bit dual-core processor that it claimed was 200 percent more efficient than comparable chips thanks to its 2GHz processor speed and five to 13 watt power consumption.

PA Semi's chips are already running on hardware sold by NEC, but they aren't likely to show up in any Apple products for at least a year because of product development cycles.