Apple to Make an Offer to Acquire ARM?

[OllyW]

The idea that because one company becomes so successful selling it's wares to various cellphone makers, that this means no one can buy that company, is absurd. If every cell phone maker allows themselves to be cornered like that, with no other option to turn to for processors, that is their mistake. Other options do and will exist.

There is no reason why another company can't buy ARM.

The problems start when a company such as Apple buys ARM and starts blocking the licensing of ARM processors to other companies allowing Apple to gain an unfair advantage in the market place over it's competition.

 

[*LTD*]

Then again, Apple might not intend to buy ARM at all.

As with a lot of things on MR, all of this is essentially academic until "rumour" turns into "fact."

 

[DeepIn2U]

Who are the morons that think this is NEGATIVE!??


1. ARM does NOT make any hardware, just reference designs' to the hardware.
2. Just about 80% of all the smartphones produced in the past 10 years and in the foreseable future are MADE with ARM based cpu's - licensing the reference design:
Think....
Texas Instruments 3430, 3630, 4340 etc.
ARM Cortex A8, A9.
nVidia Tegra2 which is used in ALL Audi Cars 2011 year models including the new A8 as the base/core of their MMI internal Audio/Media/Navigation systems (Jobs own's an Audi)!
FreeScale's existence is based on ARM cpu's.
Nokia's main base of all Symbian smartphones use ARM v11 based cpu's from VAST producers.

The only REAL competition is from Qualcomm.
Snapdragon & Snapdragon 2 (dual core) are loosely based on ARM technology (loose enough to escape lawsuit, is anybody's guess).

This is HUGE news for Apple; and another seeming battle towards Google.

I saw this is a VERY smart buy!!

Remember the conference call earlier this week!? "New products into the future" most likely more based on ARM technology's which means no more licensing fees for the maker of the A8 cpu that Apple commissioned from sister company.

 

[BruiserBear]

There is no reason why another company can't buy ARM.

The problems start when a company such as Apple buys ARM and starts blocking the licensing of ARM processors to other companies allowing Apple to gain an unfair advantage in the market place over it's competition.

My point was that it's not an unfair advantage. If Nokia got so locked into using ONLY ARM processors and had no backup plan in place, that is their problem. Not Apple's problem, and not ARM's problem.


There are alternatives in the marketplace, and these other cellphone manufacturers could turn to them if they wanted to.

 

[cmaier]

Remember the conference call earlier this week!? "New products into the future" most likely more based on ARM technology's which means no more licensing fees for the maker of the A8 cpu that Apple commissioned from sister company.

I don't think that this quote had anything to do with ARM.

 

[firewood]

A dominant competitor in a market segment cannot just buy up the key supplier to all the other competitors.

Then it would be just fine for Apple (#3 in the smartphone market) to buy ARM Holdings, but not for Nokia (#1).

 

[ten-oak-druid]

I think Apple would be better off allowing ARM chips in other phones if they acquire it.

Just disable flash.

 

[christian_k]

My point was that it's not an unfair advantage. If Nokia got so locked into using ONLY ARM processors and had no backup plan in place, that is their problem. Not Apple's problem, and not ARM's problem.


There are alternatives in the marketplace, and these other cellphone manufacturers could turn to them if they wanted to.

It is not that simple. People here mostly talk about mobile phones. This is only a small fraction of the products that use ARM.

ARM is also used in automitive applications. Imagine you have a one year old car that uses an ARM in the antilock brakes and in a year or two that cpu is not available any longer and a failed antilock brake controller cannot be replaced. Technically the manufactor could use a different cpu, but such a change would void approvals in many countries. In this case you would not just "repair" your car but change it (this has legal consequences that can be expensive and complicated). There are also many industrial applications that have to be supported much longer than the two years of a typical mobile phone contract.

Also consider software: I don't think it would be a problem for nokia to make Symbian/s60 run on a different cpu, but all older Apps would be incompatible (Rosetta like binary translation is not a good option on a mobile device).

Christian

 

[huntercr]

Oh F No!

I sure hope not. This would completely devastate the cellphone industry.

Ironically I think it would make Intel very happy. Since they're the only other player in the low power cpu market ( I could be wrong about this, anyone know any other cpu competitors for this market?)

 

[iSee]

It is not that simple. People here mostly talk about mobile phones. This is only a small fraction of the products that use ARM.

ARM is also used in automitive applications. Imagine you have a one year old car that uses an ARM in the antilock brakes and in a year or two that cpu is not available any longer and a failed antilock brake controller cannot be replaced. Technically the manufactor could use a different cpu, but such a change would void approvals in many countries. In this case you would not just "repair" your car but change it (this has legal consequences that can be expensive and complicated). There are also many industrial applications that have to be supported much longer than the two years of a typical mobile phone contract.

Also consider software: I don't think it would be a problem for nokia to make Symbian/s60 run on a different cpu, but all older Apps would be incompatible (Rosetta like binary translation is not a good option on a mobile device).

Christian

Your scenario doesn't make any sense.

Why would Apple spend $8 billion to buy ARM and then refuse licensing revenues from companies it doesn't remotely compete with?

Why would Audi, e.g., license ARM processors under a contract that could be canceled at any time?

 

[firewood]

Ironically I think it would make Intel very happy. Since they're the only other player in the low power cpu market ( I could be wrong about this, anyone know any other cpu competitors for this market?)

MIPS Technologies, Inc. (NASDAQ:MIPS).

 

[Poll Smoker]

It's an Apple fanboy's wet dream, to be sure.

You would know.

 

[reactions]

C'mon Steve! Pull the trigger!

Lol admit it guys

apple is the new microsoft

apple is evil.

 

[christian_k]

Ironically I think it would make Intel very happy. Since they're the only other player in the low power cpu market ( I could be wrong about this, anyone know any other cpu competitors for this market?)

Other comparable CPUs architectures include SuperH,
MIPS (this is used in the Playstation portable) and AVR32.
PPC is also used in many embeded applications (game consoles, automotive etc.) today.

Christian

 

[NickK1066]

The only REAL competition is from Qualcomm.
Snapdragon & Snapdragon 2 (dual core) are loosely based on ARM technology (loose enough to escape lawsuit, is anybody's guess).

This is HUGE news for Apple; and another seeming battle towards Google.

Also nVidia's solutions (Tegra) for mobile devices utilise ARM licenced designs.

Ok.. I missed that line from your post - sat in a meeting for the last 3 hours with the sun on the screen..

 

[christian_k]

Your scenario doesn't make any sense.

Why would Apple spend $8 billion to buy ARM and then refuse licensing revenues from companies it doesn't remotely compete with?

Why would Audi, e.g., license ARM processors under a contract that could be canceled at any time?

Of yourse you are right and I posted something similar several hours ago. I also think Nokia etc. have contracts that give them secure access to ARM for a long time since they made a huge investment.
But most people here only think about mobile phones. This is only a small fraction of ARMs target market.

Christian

 

[ddrueckhammer]

I'd prefer they buy Nintendo, merge the AppleTV with the next Nintendo console, and for the most part let Nintendo still run under it's own name and current management. Have the biggest difference be that the Nintendo games need to be developed in XCode. this would encourage more mac games as the porting process should be somewhat trivial.

I like the way you think. Unfortunately, Nintendo is probably the most valuable company in Japan right now and there is no way that Apple could afford them.

Besides, AMD, ARM, and Adobe look like better/cheaper purchases.

 

[skn]

Your scenario doesn't make any sense.

Why would Apple spend $8 billion to buy ARM and then refuse licensing revenues from companies it doesn't remotely compete with?

Why would Audi, e.g., license ARM processors under a contract that could be canceled at any time?

8B is less than the Apple's first quarter revenue and about 3% of Apple's Market Cap... Don't forget that Apple has 40B cash hoard to spend on whatever they want... http://www.reuters.com/article/idUSN259833320100225

As for Audi, of course Apple will supply ARM CPUs to them unless Audi decides to sell smartphones too...

 

[gimpymw]

What happens to ARM stock holders if the company gets bought out? Is it going to be run separate from apple, or 'absorbed'?

Huh?

They're the ones Apple is going pay. Apple has to buy the stock from the holders. That's what the rumored 8 billion is for. Apple would pay an over valued price for the stock to convince the holders to sell it to Apple.

This takeover rumor sounds like Apple wants to buy 100% of ARM holdings which would indicate, from prior examples, that Apple would absorb the company.

It's not clear what Apple would do with all of the ARM IP because there is no prior precedent for such a large takeover bid of another entity in Apple's history.

 

[*LTD*]

I like the way you think. Unfortunately, Nintendo is probably the most valuable company in Japan right now and there is no way that Apple could afford them.

Valued at ~$71 billion.

 

[Poll Smoker]

8B is less than the Apple's first quarter revenue and about 3% of Apple's Market Cap... Don't forget that Apple has 40B cash hoard to spend on whatever they want...

It's in the original article, Einstein.

 

[gimpymw]

8B is less than the Apple's first quarter revenue and about 3% of Apple's Market Cap... Don't forget that Apple has 40B cash hoard to spend on whatever they want... http://www.reuters.com/article/idUSN259833320100225

As for Audi, of course Apple will supply ARM CPUs to them unless Audi decides to sell smartphones too...

Revenue is what you bring in before you factor in your costs. Profit is the "cream". Apple doesn't make close to 8 Billion in profit in a quarter. It would probably take Apple 3-4 quarters to cover 8 Billion.

 

[daxomni]

Remember ARM is a British company so they will also have to get the approval of the European Commission before any sale takes place. The EC is no pushover as Microsoft and Intel have found to their cost when they have attempted to stifle fair competition.

This is the primary consolation consumers with open eyes still have. We all know the US Government hasn't had the spine to protect American consumers for decades now. Witness the way the EU and the US treated Microsoft. One fined them in cold hard cash based on revenue, the other took little plastic discs in lieu of a much smaller (revenue independent) payment.

 

[nuckinfutz]

Apple IS a monopolistic company. Period. There are so many examples. iPhone, for one, is a closed product. You can only install a software that Apple say it's OK for them. No flash, no Java, no emulators... Why I can't run uae for example on an iPhone? What's wrong with that?
It will not be a surprise if Apple decide in the following years to apply the same stupid policy to Macs so you will only be able to download "Apple-blessed" softwares from a MacStore...

Dude...dictionary.com. Go read what a monopoly is and then realize how silly your statement is. Some of us older cats that grew up with Ma Bell know what a real monopoly looks like.

Whether the iPhone is closed or open a determining factor of its monopoly status. Using your logic the Playstation, the Xbox 360 and the Nintendo Wii are all monopolies. We know this isn't true.

 

[skn]

Revenue is what you bring in before you factor in your costs. Profit is the "cream". Apple doesn't make close to 8 Billion in profit in a quarter. It would probably take Apple 3-4 quarters to cover 8 Billion.

I'm aware of that. It was just an example to show that 8B means nothing to Apple...