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Apple close to foundry deal with Intel?

Reports that Intel will make some iDevice processors resurface as Apple seeks to reduce dependence on Samsung


Published: 8 March, 2013

READ MORE: Intel | Processor | iPhone

Reports that Apple may turn to Intel to manufacture iPhone chips have been circulating for a year, and are gaining new credibility after the semiconductor giant said it was about to close a foundry deal with a major mobile customer.

This revived talk that Apple would team up with the supplier of its iMac processors - reducing its reliance on the foundry services of handset enemy Samsung, and in return boosting Intel's fledgling business in third party manufacturing. The alliance could even see x86 processors finding their way into iDevices, not just Macs, in future, say some analysts.

A detailed Reuters report, citing various unnamed sources, claims that the two US giants have been discussing a manufacturing deal for about a year. Sunit Rikhi, general manager of Intel's custom foundry business, told the news agency that the company was prepared to begin a new deal with a large, unidentified mobile customer, though he would not comment on whether that partner was Apple.

The iPhone maker has been seeking to reduce its dependence on Samsung since their handset and IPR rivalries have heated up in recent years. It buys significant components such as displays and memory chips from the Korean firm, and its own A5 processor, originally co-designed with Samsung, is still made in that company's foundries. Apple is also said to be ready to transfer some production of next generation processors to Taiwanese foundry giant TSMC.

Intel is a newcomer to the contract manufacturing space despite its massive investments in cutting edge processes. It now aims to generate additional revenue from these, and has signed up a few specialized fabless chip designers, as well as, recently, FPGA supplier Altera. Of course, the biggest obstacle to Intel joining Apple's manufacturing chain would be that it does not support the ARM architecture, which underpins A5. That has led to speculation that Apple could introduce Atom to some iDevices, or that Intel would start to make ARM-based chips, a step which would be possible without it converting to ARM for its own products.

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