Apple in Talks to Buy Israeli Flash Storage Company Anobit for Over $400 Million

[cameronjpu]

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Thank god for that 80 billion!

 

[cameronjpu]

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This move is most likely that Apple can secure flash storage but its more due to the fact that they can now keep their storage prices sky high for the forseeble future. Apple have to be the greediest most extortionate company in the business. They make great products but boy, they are greedy

All companies are equally greedy (that's the point!). Apple just happens to have products that everyone wants.

 

[cameronjpu]

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Guys this is not a manufacturer. They own ip. There are two possible plans for apple. One is to take this technology off the market for its competitors. If apple has flash that lasts an extra year or two longer with high reliability, that increase in system reliability and longevity could pay for itself with higher prices for gear. The aura of quality. "my Hp laptop died after 3 years but your apple is still kicking after 6!"

Or of course apple could just think its a good investment and plan to continue to license its technology and (gasp) make a profit. When you have 80b in the bank earning 1%, anything you can do to grow that is wise.

 

[G4DP]

It's good to see that only 10% percent of people on this site actually read the articles.

This company doesn't make anything. They have NO fabrication facilities.

It is a lot of money for I.P. There must be something stunning in it for the company to value themselves that highly and for Apple to reportedly be in talks to pay that much.

 

[wizard]

SLC is certainly a better choice for ultimate reliability.

I'd rather have SLC over MLC.

Most certainly, especially as the processes shrink and flash becomes far less reliable.

Although, I have to wonder if Apple's recent lawsuits against the entire industry has forced them to find alternatives, I can't imagine Samsung being too happy providing any more services for Apple.

Your first comment was insightful this however is uninformed. Apple is going after Android because it is a clear ripoff of iPhone technology. The vast majority of the ore lawsuits Apple is involved in are people going after Apple trying to soak up some of their cash.

As to Samsung, again this is business. Some time ago it was rumored that Apple was employing 80% of Samsungs custom chip capacity. I don't think Samsung is unhappy at all. In fact right now I can't see them being pleased at all with loosing Apple as a customer. Apple is a billion dollar (probably many times over) customer that would be hard to replace.

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Flash storage is stupid. The cloud is the future.

Flash storage will only go away when there is something that is a better replacement technology wise. There are just too many issues, many unrelated at that, that requires devices to employ ever larger amounts of storage.

The cloud has its good points but for many it has far more bad points.

 

[KnightWRX]

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Guys this is not a manufacturer. They own ip. There are two possible plans for apple. One is to take this technology off the market for its competitors. If apple has flash that lasts an extra year or two longer with high reliability, that increase in system reliability and longevity could pay for itself with higher prices for gear. The aura of quality. "my Hp laptop died after 3 years but your apple is still kicking after 6!"

Or of course apple could just think its a good investment and plan to continue to license its technology and (gasp) make a profit. When you have 80b in the bank earning 1%, anything you can do to grow that is wise.

You're forgetting scenario #3 :

- This company approached Apple about renewing an IP license and decided to charge so much money that the only decision that made sense was a buy out to keep using the IP in question. Basically, call it "extortion" if you want. IP trolls are like that unfortunately.

Your first comment was insightful this however is uninformed. Apple is going after Android because it is a clear ripoff of iPhone technology.

So ironic that you would call a poster uninformed and then state such a blatant misinformed comment. Apple is not going after Android at all. They have currently no lawsuit going against the OHA or Google.

 

[mijail]

This company doesn't make anything. They have NO fabrication facilities.

It is a lot of money for I.P. There must be something stunning in it for the company to value themselves that highly and for Apple to reportedly be in talks to pay that much.

Just like ARM.
So looks like a viable business model.

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You're forgetting scenario #3 :

- This company approached Apple about renewing an IP license and decided to charge so much money that the only decision that made sense was a buy out to keep using the IP in question. Basically, call it "extortion" if you want. IP trolls are like that unfortunately.

Any reason to think that they are any more of a troll than, say, ARM?

 

[KPOM]

You're forgetting scenario #3 :

- This company approached Apple about renewing an IP license and decided to charge so much money that the only decision that made sense was a buy out to keep using the IP in question. Basically, call it "extortion" if you want. IP trolls are like that unfortunately.

That's a real possibility, since the article says that Apple already uses some of the company's technology.

IIRC, Sandforce was recently acquired for about $300-$400 million. That helps put the $400-500 million into perspective.

 

[OneOkami]

Accessing the cloud is slower than HDD access which flash intends to replace. From a performance standpoint, it is a step backward. Also, what happens when you have no internet?

Even when you do have internet, you've got ISPs imposing bandwidth caps on people, it really holds back the potential of the benefits of internet connectivity in many ways.

 

[KnightWRX]

Any reason to think that they are any more of a troll than, say, ARM?

Nope. But it's still a possibility I was throwing out there. We're low on details here, any scenario can be valid. Frankly, what does buying a Flash design firm does to help Apple aside from removing a licensing issue for the IP in question ? (and other than locking out the competition from said IP).

 

[fjanderson94]

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I think this would be good for apple so they don't have to rely so much on samsungs flash hardware and apple could then develop their own.

 

[alphaod]

I wonder how Anobit's flash endurance technology compares to the one that Intel is using for their new "enterprise" MLC storage devices.

 

[Wilder]

That's what I thought.
Why would you pay this much just for a R&D/Design company.

As the article said: "Anobit is a fabless semiconductor company"

That means Apple still has to find and rely on other people to make the actual product. If they were buying the R&D and the capacity to manufacture then I'd understand as they can have free control over everything to make products in private (so to speak) specifically custom to Apple only products.

Seems a lot to spend, and then still be reliant on other companies to make the things.

People don't realise that outsourcing production is a good idea strategically because the more resources, for example, Samsung uses manufacturing components for Apple the less it has for itself.

It's good to see that only 10% percent of people on this site actually read the articles.

This company doesn't make anything. They have NO fabrication facilities.

It is a lot of money for I.P. There must be something stunning in it for the company to value themselves that highly and for Apple to reportedly be in talks to pay that much.

Compared to other companies recent acquisitions—Microsoft-Skype, Google-Motorola and HP-Palm—this isn't a large acquisition. As KPOM said, $400 is a reasonable price for this kind of company.

 

[KnightWRX]

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I think this would be good for apple so they don't have to rely so much on samsungs flash hardware and apple could then develop their own.

How does this acquisition remove the reliance on Samsung and other Flash memory manufacturers exactly ? Read the article people : this is a fab-less company. Apple would still need Samsung and other manufacturers to actually make the memory after this acquisition. This is strictly IP, just like PA Semi.

 

[theSeb]

Flash storage is stupid. The cloud is the future.

Put down the kool-aid, son.

 

[divinox]

There are certain things that I want to have physically stored. I don't really mind flash storage, I'm just hoping >512GB SSDs are within affordable price.

"physically" makes little sense, as a drive in the cloud is just as (non)physical (i.e. digital) as a drive in your box. If anything, you mean locally.

 

[KnightWRX]

"physically" makes little sense, as a drive in the cloud is just as (non)physical (i.e. digital) as a drive in your box. If anything, you mean locally.

I bet he means locally. I don't like cloud storage not because of technical limitations (connection speed, etc..) but because of privacy issues. My data, my storage. I don't want anyone having the right to snoop around my stuff.

 

[jmille44]

Bad move Apple. What is the real reason for buying this lemon?

 

[KnightWRX]

Bad move Apple. What is the real reason for buying this lemon?

Why do you call this a lemon ? Frankly, Apple was already licensing the IP in question, so there's definitely something good there. Depending on the reasons for wanting this deal, I really don't see how this is a bad move.

 

[Piggie]

People don't realise that outsourcing production is a good idea strategically because the more resources, for example, Samsung uses manufacturing components for Apple the less it has for itself.

I don't think it works like that.

Samsung don't have a building with 50 machines in and think, dam we've got 40 of them set up for Apple work, so we can only use 10 of them to make our stuff with.

That might be how it would work for you in your kitchen at home making cakes, but I'd not suspect a company such a Samsung has these problems.

 

[mijail]

Nope. But it's still a possibility I was throwing out there. We're low on details here, any scenario can be valid. Frankly, what does buying a Flash design firm does to help Apple aside from removing a licensing issue for the IP in question ? (and other than locking out the competition from said IP).

Looks like Apple uses memory from Hynix, which reportedly uses Anobit's tech. I Am Not A Lawyer or anything, but I'd guess it'd be Hynix who would have an IP relation with Anobit, not Apple.

As from the advantages: maybe the same than buying PA Semi. Or Siri. Who knows what plans they have; maybe the could implement something in some new specific way, or maybe they just want to keep it for themselves and away from the competition.

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Frankly, Apple was already licensing the IP in question, so there's definitely something good there. Depending on the reasons for wanting this deal, I really don't see how this is a bad move.

Any reason to think Apple was licensing the IP themselves?

 

[SeaFox]

A $400-$500 million acquisition price would make Anobit one of Apple's largest acquisitions ever. Prior to that, you have to go back to 1997 when Apple paid $404 million to acquire NeXT, Inc, bringing Steve Jobs back to the company.

Make sure you're adjusting the older figure for inflation or it's not an accurate comparison.

The NeXT acquisition would have been over $546 million today.

 

[TallManNY]

Largest acquisition by Apple ever . . . and it uses about two weeks of Apple's free cash flow. Good thing you have $85 billion sitting in the bank so you could fund this.

Come on Apple, what are you holding onto those billions for? There is a decent chance that capital gains will be raised above 15% shortly, so pay a dividend now!!!

 

[Winter Charm]

It makes perfect sense, if one is considering fully switching to SSD's, to invest in their long term reliability.

EDIT:
Here's a quote from Anobit's technology page:

Specifically, MSP™ enables SLC (one bit-per-cell) endurance and performance with MLC (two bits-per-cell) NAND, and MLC endurance and performance with TLC (three bits-per-cell) NAND, resulting in a significant reduction in cost per-bit.

For those of you who haven't done their homework about SSD's, SLC's are really nice and reliable, but lack storage space, as they only store one bit per cell. MLC's and TLC's store 2x or 3x more (respectively) but they are less reliable and much more short lived. However, if their MSP technology really works (it does because otherwise apple would not be trying to acquire them) then you get the PERFORMANCE and RELIABILITY of an SLC and still keep the 3 bits per cell (or 3x the storage).

Effectively, this means cheap and high performance flash storage for Apple. And it makes perfect sense to buy the company and keep SSD's out of reach for everyone else.

 

[gnasher729]

Bad move Apple. What is the real reason for buying this lemon?

Would you mind sharing the source of this wisdom? What reasons do you have exactly to call Anobit a "lemon"?