News & Analysis

Apple enters IC market, buys PA Semi

Mark LaPedus

4/23/2008 9:34 AM EDT

SAN JOSE, Calif. -- Taking a big step in the IC business, Apple Computer Inc. has acquired PA Semi Inc., a supplier of embedded microprocessors, for $278 million in cash, according to Forbes.

It's unclear what Apple will do with PA Semi, but the report indicates that the computer maker will target the chip maker's product for the iPhone or other systems.

Headquartered in Santa Clara, Calif., P.A. Semi was established in 2003 by industry veterans to develop a high-performance, low-power processor family. P.A. Semi is headed by Dan Dobberpuhl, the acclaimed lead designer of the DEC Alpha series of microprocessors, the StrongARM microprocessor, and the first multicore systems on chip with the SiByte 1250.

Last year, startup PA Semi shipped chip samples that demonstrate its claim of taking the PowerPC architecture's power consumption to new lows for a range of embedded markets.

Apple may use the company's technology in the company's set-top box. Apple has been pushing something called Apple TV.

''PA Semi would be great for high-end embedded applications," said Loring Wirbel, director of the EE Times Market Intelligence Unit.

''The PA-Apple relationship is no surprise. Apple considered acquiring the company in 2005,'' he said. ''Now, PA Semi is a company that is shipping silicon to a variety of customers. It seems wrong to take it off the market at this phase of the game -- though it wouldn't be the first time an OEM has taken a chip or software company off the market. Cisco is a repeat offender.''





Rick Merritt

4/23/2008 1:18 PM EDT

It's not the first of April is it?

This is weird! Why would Apple want to buy a company delivering a 15W embedded PowerPC?

My guess is either the story is wrong or Apple has decided it wants a good low power PowerPC design team and will jettison PA's products.

My task today is to find out if it's true and if so what its about. Got some info: drop me a line at rbmerrit@cmp.com

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lwirbel

4/23/2008 1:36 PM EDT

Wouldn't be the first time an OEM acquired a semi company for future designs, while jettisoning the old products. Think Cisco with Granite, AuroraNetics, Radiata. But what will the poor PA Semi customers like Extreme Engineering do?

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Mapou

4/23/2008 2:24 PM EDT

Wow! This is beautiful. There hasn't been so much excitement in the semiconductor industry since the late 70s. Apple seems to enjoy suprising us with strange moves every once in a while, while keeping us guessing about its intentions. What's interesting about this is not so much that PA Semi is a fabless processor vendor but that they are very good at designing low power multicore processors. In my opinion, the fact that they've been using PowerPC cores is irrelevant. What's relevant is that Apple has just entered the multicore processor market. Watch out, Intel. :-D

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lwirbel

4/23/2008 7:36 PM EDT

But remember, Mapou, Apple has no intention of selling processors to the merchant market. It was like Cisco buying Granite or Procket, a case of using the processor design teams and IP internally. That's why prime contractors in mil-aero want the DoD to block the sale.

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