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Mac: By Intel

Via Joanna Robinson, I see rumors that Apple will strike a deal to use Intel as the supplier for future Mac chips. A quick scan of Googe News reveals that for reasons I don't understand (this is why I don't do business reporting) this news is considered so consequential that one can legitimately attribute a general market rally to it, even though IBM which would clearly be the loser in any such deal (they make the current Mac chips), is also going up. These dudes say it's not happening, in an article which also reveals that the reason there's no G5 laptop is that the chip gets too hot (ed. note: see, dad, I was right!) which kind of sucks.

Unlike some Mac users, I don't have some sort of ideological opposition to such a deal. If it really would make the computers cheaper without making them, you know, worse then it obviously seems like a good idea. On the other hand, it seems like such an obviously good idea that it's a bit hard to believe such an option has really been sitting on the table.

In unrelated second-guessing of the Apple business model I'm continually baffled by the company's seeming reluctance to take advantage of the open-source opportunities afforded by OS X. I have to believe that if Apple paid someone to work full time on finishing the NeoOffice port to make it look fully native and then packaged the software free when new Mac units shipped that this would be a worthwhile move for the company even though (since it's General Public License) they can't make money selling the program as such.

May 24, 2005 | Permalink

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"On the other hand, it seems like such an obviously good idea that it's a bit hard to believe such an option has really been sitting on the table."

That would be Steve Jobs.

Posted by: Publius Rex | May 24, 2005 4:07:28 PM

Until recently, there has been serious doubt that Intel was going to be able to produce their next generation of chips.

Posted by: bobo brooks | May 24, 2005 4:09:43 PM

Not being a business reporter, you apparently fail to understand that the bar for being able to "attribute a general market rally" to some news item is set *very* *very* low...

But theoretically, if cheaper chips allow Apple to sell more Macs, and as a result more computers are sold, why wouldn't this be good for the market as a whole?

Posted by: Alex R | May 24, 2005 4:16:54 PM

Matt, in the back of people's minds is the fact that if Apple did that, Microsoft (which is no longer contractually bound to produce Office for the Mac) would probably retaliate, and having Office is a much bigger deal for Apple than having a native version of NeoOffice or OpenOffice would be.

(On preview: as Alex says, this sort of business reporting is just an attempt to find a rationale for a random walk. An Intel/Apple rumor isn't a market-moving event.)

Posted by: Steve | May 24, 2005 4:20:03 PM

I am a long time mac user but no techie. I write this on an iBook G4, but I bought my first mac in 1984 (?), the one that had no hard drive, which I still have in the basement, with the original PROM (IIRC), and it's bootable, to my knowledge. I spilled coffee on the keyboard accidentally (shutup Freud) and, exasperated by this final straw, put it aside for a new one.

But I digress. Apple will be the bigger monopolist in the end, compared to Microsoft, because they do hardware and software. Ane they have learned to profit from the new intellectual property rights environment. Their music store is overpriced and has fewer offerings than peer to peer, but design, constant innovation, consumer sensitivity, inertia, and hype keep it in business.

And their whole philosophy of programming, using freeBSD unix as the basis of OSX, is to take advantage of open source innovation, but altering it for reasons of improving it, molding it to their system, and for copyright purposes.

Apple will soon come out with an Office Suite, and NeoOffice might have been a good beginning, but I suspect that they are too deep into their own project. This will leave them more in control.

Short answer: They want to make more money.

Posted by: epistemology | May 24, 2005 4:24:59 PM

It hurts to think that IBM will cede more to Intel in the personal computer chip wars. I can't help but think that it will be bad for comptetition to have IBM spend less on new pc chip designs. In many ways, like low heat and RISC chip design, they have led Intel.

Posted by: epistemology | May 24, 2005 4:28:29 PM

They seem to be trying to muscle in a bit. Keynote looks better than powerpoint to me, but I find all presentation software difficult.

There's teh new word processing with design thing called Pages.

Posted by: Abby | May 24, 2005 4:28:51 PM

Many in the Mac news-watching community all had our Rumor Senses barely tingling since the "Apple/Intel" {tech rumors | Wall Street hard-ons} have been going on since before "Apple/Disney" merger rumors. Wall Street likes it because the pundit get to go "nyah, nyah. Told you so: Apple has to be like everyone else and play the game we want them in order to survive." Consumers get dreamy eyed at the idea of Macs costing a buck-ninety-five. Tech pundits again get to say "See, Apple was doing it all wrong We proved it again!"

And even if Apple threw a whole department at developing an Office-killer either using internal resources or borrowing open source, it wouldn't matter. Micro$oft would just break it all over again with the next file type revisionm, because the only thing that matters is "will Apple Office open my Word/ Excel/ Powerpoint/ Access files from my coworker *without messing it up?*" Safari can only continue to make in-roads as long as websites don't break. But when MS releases IE2007 Longhorn with some new proprietary HTML/XML extensions that only function with IIS server and FrontPage..... then Mozilla/ Safari/ Firefox/ iCab/etc,etc will be scrambling to gain back compatibility. (Well, maybe not Netscape for Windows because they've decided to use Microsoft's rendering engine as a backup to Gecko as of version 8 released last week.)

And yet the question of "why can't Microsoft build a consistent file type or stick to openly documented format?" continues to be beggared. When going from Office95 to Office2000 to OfficeXP broke things in Windows or going from Word 5.1 to Word 6 to Word98 to Word X broke things on Macs. Realistically, not that much and it was relatively simple to fix for saavy users, but for the _average_ user it would drive them nuts because they're tables were broken or images no longer displayed exactly the same way.

Posted by: madbard | May 24, 2005 4:29:46 PM

Bad link. Here is the link to Googie News.

Posted by: foo | May 24, 2005 4:37:39 PM

A few misconceptions to clear up here.

First off all, I didn't see the original article in the Journal, but from what I can tell the story is about Apple using Intel chips, not Macs using X86 chips. Despite the fact that Darwin (the OS X kernel) compiles for x86, and rumors that much or all of the rest of OS X does as well, there are significant structural reasons that would make a change in instruction set an tremendous disruption. The switch from 680x0 to PowerPC was accomplished with relatively little pain, but that's only because PowerPC had a huge enough performance lead that it could emulate 680x0 at above-native performance. The performance gap between x86 and the G5 is nowhere near that large, and indeed is likely negative where AltiVec comes into play.

Instead the much more likely product for Intel to supply Apple with is some version of its XScale ARM derivatives for some consumer device, whether an iPod successor or something else. Indeed, this is the only reason Apple would have to negotiate directly with Intel; if they just wanted to use x86 chips, they could just buy them on the open market like everyone else.

Second, the GPL does not mandate that Apple could not charge for a fork of NeoOffice or any other GPL'd program--look at all the companies charging money for Linux distributions. All it means is that Apple cannot stop anyone who legally purchases a copy of their GPL'd product from requesting the source code and then compiling their own version and distributing *that* for as much or as little money as they choose (provided it is GPL licensed). The Apple branding (protected by trademark, not copyright, and thus not subject to the GPL) and implied seal of quality would be enough to get most to pony up even though a no-cost version would quickly be available.

Posted by: Dave H | May 24, 2005 4:47:54 PM

Apple will strike a deal to use Intel as the supplier for future Mac chips.

How many times have we heard this one? As a long-time mac user, it wouldn't make a bit of difference to me if were true (so long as everything worked properly), but...I'll believe it when I see it.

Posted by: jonnybutter | May 24, 2005 4:49:07 PM

Um, I generally agree with the analysts who say the deal is hogwash.

Apple is in a position to convert to X86 (Darwin runs on X86 and and no doubt Carbon does too at this point) if they get desperate, but there's no real reason to do so. There's no technical advantage except possibly relatively minor speed gains, and it's a net negative because suddenly all those OS X apps have to be recompiled and/or emulated. (Emulating an old 68k chip on a G5 is easy. Emulating the old OS when using the same instruction set is easy. Emulating a new G4/5 and the old OS and the old chip AND the old G5 OS/X apps is much much harder.)

There might be a cost advantage for them, IF they used whichever X86 processor was cheapest, but if so, then an exclusive deal with Intel is not going to work like that. Also, AMD makes better chips at this point. There are reasons to argue that Mac users would be better off if OS/X ran on an open X86 architecture (or, for that matter an open G5 architecture), but Apple makes money on that hardware. It's a loser for them. That's also why they don't release OS/X for X86: it takes away from their hardware platform.

Apple survives with a narrow user base because that narrow base is willing to pay the bucks neccessary to help Apple overcome its cost disadvantages.

If they start selling PC's (basically) all they really are is the company that made the Carbon GUI for Darwin (that is, BSD). It's a long slide downhill for them.

So anyways, an Intel deal is bullshit.

A quick scan of Googe News reveals that for reasons I don't understand (this is why I don't do business reporting) this news is considered so consequential that one can legitimately attribute a general market rally to it,

Day to day rallies on the stock markets basically run on hype and bullshit. ['Something's happening! Apple is doing something I don't understand with Intel! Everyone is going to be buying! Quick BUY BUY BUY now!'] Much like many blogs.

ash
['Whee!']

Posted by: ash | May 24, 2005 4:50:16 PM

"having Office is a much bigger deal for Apple than having a native version of NeoOffice or OpenOffice would be."

This is so true it isn't even funny.

"Many in the Mac news-watching community all had our Rumor Senses barely tingling since the "Apple/Intel" {tech rumors | Wall Street hard-ons} have been going on since before "Apple/Disney" merger rumors"

MY is too young to remember all this.

"And yet the question of "why can't Microsoft build a consistent file type or stick to openly documented format?" continues to be beggared."

One word: Upgrade. Have to drive everyone to upgrade, else no profit.

I don't buy the Intel rumor -- Intel's at a dead-end, and the new Cel processor is the future. IMO. That is why I think, if there is anything to this rumor, Dave H's take is right.

Posted by: Al Gore | May 24, 2005 4:53:06 PM

Apple is a hardware company that makes and OS in order to sell the hardware.

The fact that their customers buy the hardware to get the OS doesn't change that. Moving to Intel chips would be fairly simple for them if they worked out the vector processing issues since Darwin is open source and already runs on Intel chips (download it from developer.apple.com and see).

Mobing to Intel chips would more than likely end thier hardware business profitability as soon as the hacks to get Aqua and Quartz running on white boxes were posted.

Unless they have a Mac ROM thing up their sleeve again, unlikely, moving to Intel chips is likely to result in the end of Apple as you know it.

As to the Office thing, the others above are spot on. Microsoft will break the rtf format on a whim; they've messed up web standards with their embrace, extend and control philosophy. Cloning Office is nothing more than an E ticket to a ride called Chasing Your Own Tail.

Posted by: sixteenwords | May 24, 2005 4:53:38 PM

IBM's stock price did not go up.

http://bigcharts.marketwatch.com/quickchart/quickchart.asp?symb=ibm&sid=0&o_symb=ibm&freq=9&time=1

Posted by: ostap | May 24, 2005 5:21:32 PM

Just because something is GPL'd doesn't mean they couldn't make money selling it. They could sell it all they wanted, but they would have to make their changes available (for free) to anybody who wanted them. So if apple did that they could still charge an extra $20 bucks on each mac for copy of NeoOffice, but if people wanted to they could download it for free.

Posted by: josh | May 24, 2005 5:24:21 PM

This is a reoccurring rumor, and John Gruber's essay from two years ago still rings true:


The only way Apple could switch from PowerPC to Intel as seamlessly as they switched from 68K to PowerPC would be if they were to implement a PowerPC emulator for this hypothetical Apple-Intel platform. Not just a working emulator, but a fast working emulator. I just don’t think this is possible, and I’ve never seen a credible report claiming it is.

And without a fast PowerPC emulator, all current Mac software would be dead. Sure, companies like Adobe, Microsoft, and Macromedia might release the next major updates to their applications with native support for the new processor, but what about the versions people already own? Who would buy a new Mac that couldn't run the thousands of dollars worth of software they already own?


Gruber also makes a point which is stated above, by another commenter:


Apple Is a Hardware Company

This point cannot be emphasized strongly enough. Apple is a computer hardware company. Selling hardware is how Apple generates most of its revenue. Their operating system software may well be the best aspect of their computers, but that does not make them a software company. Anyone who claims that Apple could simply switch to being a software company and make up for lost hardware revenue by selling additional software doesn’t understand how the company operates.


Gruber's article is a must read.

Posted by: plemeljr | May 24, 2005 5:46:27 PM

There is no chance that Apple is going to wholesale switch over to x86 chips. None. If they tried it, they'd be out of business within two years. Everyone in the computer industry knows this, so it's astonishing that the WSJ ran that rumor, and that so many people are falling for it.

Posted by: Walt Pohl | May 24, 2005 5:55:38 PM

This story seems to surface every year or so. I think Apple is trying to create leverage over IBM to get them to commit resources to developing chips for Macs and to keep chip prices low. Apple has used this gambit before only to remain in the IBM (and previously Motorola) universe. I doubt Apple will switch to Intel, but they don't want IBM to get complacent and greedy. But who knows? Maybe this time could be different. System 9 and prior would have been prohibitively expensive to port to Intel, but Mac OS X would run just as well on Intel since it's BSD innards have run on Intel for years as BSD Unix. I think the downside for Apple would be increased pressure to abandon it's proprietary architecture in favor of the current Intel PC standard.

Posted by: robertbindc | May 24, 2005 6:06:32 PM

Apple would be much better off if Mac ran on x86 chips from Intel (or AMD), because they would automatically inherit any advances in that much bigger, more competitive market, but the problem is that they just can't get there from here. Or at least they can't without as least as much pain as was involved in going from the 68K chips to Power PC.

They're kind of in a fix where they are, though, too, because they don't do enough volume to really motivate IBM to focus on their needs (as opposed to, ironically, Microsoft's needs for the next generation XBOX--I don't think it's any coincidence that this rumor came out just after all the press-releases concerning the high-powered, custom versions of the PPC that Microsoft is using in the XBOX 360). Apple's notebooks really haven't been updated in any significant way for quite a while, and the G4 is getting to be kind of a joke (especially Apple price-levels). This is bad because notebooks are a big part of Apple's business.

One thing Apple could do (though I don't think this is likely either) is to try to sell an x86 version of OSX and their iLife applications alongside their PPC hardware and software. But it wouldn't be cheap to develop and it might undermine their Mac sales in a major way.

Posted by: Slocum | May 24, 2005 6:13:24 PM

Just today, I installed OS X on my Linux workstation by means of the PearPC emulator. It's definitely not very fast, and not rock-solid stable either, but it's also release 0.3.1 of an open-source emulator that is someone's Sourceforge project. Apple could be in a bind, since people could eventually buy and install OS X without having to buy expensive Apple hardware. I'm not sure if they'd survive the transition to becoming RedHat.

Posted by: mds | May 24, 2005 6:29:22 PM

The Mac gossip sites suggest that if Intel were to supply processors, it'd be for the long-rumoured tablet. Dave H makes the most important point here: 'Intel' does not necessarily mean 'x86'.

As for the G5's cooling problems: the best way to run PowerPC chips is at reduced power in multiple-processor configurations. Getting that into a laptop is tricky, though.

Posted by: ahem | May 24, 2005 6:55:33 PM

To the extent that Apple may be talking with Intel, it would all but certainly be about future, unannounced products, unrelated to PCs, for all the reasons mentioned. Apple has to look to its developing hardware product lines, centering on portable, multimedia devices, for future growth in all its product lines. Intel chips for such devices could smoothly fit into this future.

But, emphatically, it's not about PCs. Neither IBM or Apple would want to upset that, well, applecart.

Posted by: teg | May 24, 2005 6:59:05 PM

In unrelated second-guessing of the Apple business model I'm continually baffled by the company's seeming reluctance to take advantage of the open-source opportunities afforded by OS X.

Continually baffled? Why? The success of IPod not withstanding, Apple has been largely a stupid company for a long time. (Note to MacFanatics: I didn't say their products are bad, I'm talking about the piss-poor execution of their business strategy over the years). Anyway, seemingly inexplicable and foolish moves on the part of the folks from Cupertino are consistent with their history.

Posted by: P. B. Almeida | May 24, 2005 7:12:43 PM

Intel x86 processors are not cheaper than Apple's IBM chips. The advantage in price comes from all of the other components in the Intel designed system architecture. For Apple to gain cost advantages they would have to produce their own Dells, not Macs. Only the OS would be different and they would still be costlier than a Dell equivalent. This speculation is hogwash nurtured by ignorance of the fundamentals involved.

Posted by: R Boylin | May 24, 2005 9:41:49 PM

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