We have a tasty rumor for you today courtesy of analyst Doug Freedman of RBC Capital: according to a research note on Monday (via TechNewsWorld), Apple might turn to Intel to make its ARM processors for the iPhone, and in return move the iPad to Intel's x86 platform. All of this would take place under the backdrop of eliminating its reliance on Samsung, which currently makes Apple's A5X and A6 processors used in the iPhone and iPad.
This would be a very big deal for all three companies. Samsung would lose billions in chip revenue—something that seems likely to happen no matter what—while Intel would gain a coveted piece of the mobile market that has otherwise remained out of reach. Apple would gain the world's largest, best, and most reliable chip manufacturer as its mobile partner.
With so much to gain, you may be asking yourself why Apple didn't go with Intel in the first place when it started making its own ARM processors for iPhone, and then iPad. While we aren't privy to what goes on behind closed doors, the reality is that Intel doesn't care for ARM—a reference platform not owned or controlled by Intel—and it doesn't otherwise manufacture ARM processors.
A perfect storm has been brewing, however, a storm that could serve to drive Apple and Intel into each other's arms with lustful hearts and wicked gleams in their eyes. That storm includes an eff-you to Samsung from Apple and Intel's failure to make meaningful penetration of the mobile market with its own line of ATOM processors.
Apple is the world's largest consumer of semiconductors, but when it comes to CPUs, only the chips used in Apple's Macintosh product line have the Intel logo. Apple sells millions of iPads and millions more iPhones. That's business Intel would love to have, and Mr. Freedman said Apple's iPad x86 business would be worth $2 billion per year to Intel.
The other big factor here is that Intel is no one's fab. There are many so-called fabless chip designers, or companies that design chips and let companies like Samsung or Taiwan Semiconductor Manufacturing Company (TSMC) actually produce. Apple is one of those fabless chip designers, as it custom designs its AX-line of ARM processors and hires Samsung to make them.
Intel doesn't play that tune, however, or at least it hasn't heretofore. Intel makes its own chips from its own designs and sells those chips to companies like Dell, HP, Apple, and others.
"[Current CEO Paul] Otellini has been averse to this concept of Intel manufacturing products for other companies because Intel has historically wanted to be able to profit from both its manufacturing and design prowess," Nathan Brookwood, a research fellow at Insight 64, told MacNewsWorld.
Mr. Otellini is stepping down from the CEO spot in May of 2013, and the reality is that Apple's business is so large, it would be worth it to Intel to make this change.
One last thing: Apple was already rumored to be choosing TSMC as its replacement for Samsung. That rumor has had some legs for a while, but Mr. Freedman's story would represent an entirely different direction.
It's a direction that makes sense, though we think it important to stipulate that it's also dependent on Intel being able to make an X86 processor that is that is low enough in its power consumption to satisfy Apple's needs for the iPad.
That could be a tall order, because another rumor out there is that Apple is considering moving its Mac product line to ARM out of concern about Intel's commitment to low power consumption. That need is far greater for tablets, so we think this rumor needs to be taken with a grain of salt.