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A prequel to the Apple-PA Semi saga?

Posted: 08 May 2008 ?? ?Print Version ?Bookmark and Share

Keywords:PA Semi acquisition? Apple iPhone? PowerPC architecture?

Word on the street is that there is still a little more light to be shed on the saga of PA Semi Inc. and Apple Inc.

Readers will remember that the news broke that Apple had acquired PA Semi for $278 million in cash April 23.

Subsequently, a source has said that Apple was an investor in PA Semi prior to the acquisition. I haven't been able to find anything in the public domain about this but strategic investors sometimes prefer to go unlisted. This does make some sense as a relationship was known to exist between the two companies and it had been reported elsewhere that Apple considered buying PA Semi in 2005.

This was at the time Apple rejected PowerPC and went with Intel and its expertly manufactured x86 processors to run its computers. This was bad news for PA Semi, which was working with a PowerPC architectural licenseApple's previous processor architecture of choiceand the change at Apple put PA Semi in a difficult place.

But now, apparently, Apple sees another opportunity for the PA Semi design team and wants a new chip designed. The problem was that PA Semi had more or less burnt through its venture capital funds. The only way to get the project funded was for Apple to pay off the other investors and bring PA Semi in-house, the source said.

And, of course, due to its triple success in the Mac, the iPod and the iPhone, Apple is now sitting on a pile of cash and $280 million to acquire the design team, its know-how and patents is apparently an acceptable price to pay.

The question remains as to what opportunity Apple sees for the PA Semi design team. It is worth pointing out that personal computers (Mac), personal entertainment systems (iPod) and personal communications (iPhone) are in the processing of being merged together to create the Mobile Internet Device (MID) and my best guess is that Apple wants something related to 4Gprobably a scalable multimedia application processorthat can handle streams of graphics and video we are all going to be inundated with in a couple of years' time.

- Peter Clarke
EE Times Europe

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