Apple dumps IBM for Intel. Why and what's next?

Apple dumps IBM for Intel. Why and what's next?

Summary: While Apple and Intel CEOs Steve Jobs and Paul Otellini took the stage at Apple's WorldWide Developer Conference to make their partnership official and to discuss just exactly what the future holds, the blogosphere and the analysts are all abuzz with the analyses of what went wrong between Apple and IBM and what, if anything, will change significantly for current and future Apple customers.

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TOPICS: Apple
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While Apple and Intel CEOs Steve Jobs and Paul Otellini took the stage at Apple's WorldWide Developer Conference to make their partnership official and to discuss just exactly what the future holds, the blogosphere and the analysts are all abuzz with the analyses of what went wrong between Apple and IBM and what, if anything, will change significantly for current and future Apple customers.  Russell Beattie, for example, thinks that by announcing a switch to Intel (and needing a year before any systems ship), that Apple is going to kill the demand for its PowerPC Macs.  That's certainly a good question? If you were on the verge of buying a Mac today, and then woke up only to learn that this news wasn't a dream, would you move forward with a PowerPC-based system or would you stick it out until the new Intel gear comes?

The move raises other questions.  In our podcast coverage of the news (available as an MP3 that can be downloaded or, if you’re already subscribed to ZDNet’s IT Matters series of audio podcasts, it will show up on your system or MP3 player automatically. See ZDNet’s podcasts: How to tune in), News.com reporter Ina Fried reports from the event and tells ZDNet editor-in-chief Dan Farber that IBM was coming up short in two areas that were critical to Apple: power consumption (particular for notebooks) and performance. 

Among the many questions raised by IBM inability to satisfy Apple's appetite on both fronts, why did Apple pick Intel over AMD? Despite the fact that AMD's dual core chips appear to be running circles around those from Intel, could Intel's offerings be fast enough and could its deeper penetration into the mobile computing markets for notebooks, tablets, and handhelds (way deeper than AMD) be signalling Apple's future aspirations? Fried has the scoop for Dan.  Speaking of Intel's nemesis, Jonathan Schwartz, president and COO of AMD-bedfellow Sun, didn't waste anytime chiming in with his blog.  As long as Apple's Jobs was reconsidering underlying hardware platforms, Schwartz suggested he might want to take another bold step and reconsider the underlying software platform as well.  Today, Apple's OS X operating system is based on Darwin which itself is based on BSD Unix.  So, how trivial would it really be for Apple to port all of its extensions and graphical user interface elements over to Sun's Solaris 10? If it ever thought about moving, Apple would get the benefit of the huge amount of development resources being poured into Solaris 10 while at the same time further consolidating Microsoft competitors around fewer total operating systems (the other being Linux).

Here, with time codes, is the edited list of questions that Fried fielded from Dan Farber:

  • 01:24 In the bigger picture, what's beneath that broad statement of moving to a new hardware platform?
  • 02:02 Is the issue around providing a laptop processor?
  • 02:16 Will sales of PowerPC-boxes be hurt in the interim?
  • 02:52 Is the promise of a binary that will work on both platforms (Intel/PowerPC) somehow going to ameliorate that problem? (Apple has promised to deliver an emulation layer that allows PowerPC-binaries to run on the Intel hardware)
  • 03:28 Apple made it clear that it would be possible to run Windows on an x86 Mac but that Apple wasn't about to allow the Mac OS to run on non-Apple x86 systems.  What's behind that?
  • 04:28 But doesn't it seem to not be in Jobs character to not have control over both the hardware and software so he can deliver the perfect experience?
  • 05:03 Will there be an impact on pricing?  It was able to get a low price from IBM and Freestyle for the PowerPC.  Was Jobs able to beat down Intel and extract a lower price from it as well?
  • 05:57 AMD is also in the x86 space.  Why wasn't AMD considered given that it has a lead over Intel in performance?
  • 06:49 What does this mean for IBM in the bigger picture?
  • 07:19 Why is taking so long -- a year -- before Apple will have its first product on x86?

Topic: Apple

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  • My comments for some questions

    01:24 In the bigger picture, what?s beneath that broad statement of moving to a new hardware platform?
    => Apple is running out of the options. Staying with PowerPC is a dead end. It's better to jump the ship now before it sinks. For both IBM and Freescale to support a price sensitive Apple platform with only 2% market share is not strategic. IBM has never been a CPU company (it is a server company) and it never will. Apple should have made this move sooner even before the G5 deal. Besides, Apple can only get the 2nd class processor architecture from IBM with no guaranty to the latest POWER processor which IBM reserved only for its own servers.

    02:02 Is the issue around providing a laptop processor?
    => Certainly this is the part of reasons. Designing a G5 class processor for a notebook computer might cost up to $50M or more. Apple as a personal computer company won't pick this bill, neither will IBM. Moreover, the biggest risks on this are the low yield (high cost) and delivery that are very likely will happen from IBM fab.

    03:28 Apple made it clear that it would be possible to run Windows on an x86 Mac but that Apple wasn?t about to allow the Mac OS to run on non-Apple x86 systems. What?s behind that?
    => Apple will design its own chipset with unique features at architectural level for differentiation. The Mac OS won't have the driver support for other chipsets used in non-Apple PC.

    06:49 What does this mean for IBM in the bigger picture?
    => Nothing besides minor PR damage and credibility issue which is typical IBM. The Apple business represents only single digit percentage of IBM's Microelectronics division, and Mircoelectronics contributes only tiny portion of IBM total revenue. There is no financial impact.
    vancejen
    • More Comments

      [i]02:52 Is the promise of a binary that will work on both platforms (Intel/PowerPC) somehow going to ameliorate that problem? (Apple has promised to deliver an emulation layer that allows PowerPC-binaries to run on the Intel hardware[/i]

      Digital tried this with limited success between Intel and Alpha for Windows based applications. Apple has always had tighter control over their platform leading to a higher potential for success.

      [i]03:28 Apple made it clear that it would be possible to run Windows on an x86 Mac but that Apple wasn?t about to allow the Mac OS to run on non-Apple x86 systems. What?s behind that?[/i]

      Apple thinks its a hardware company that makes excellent software. IMHO they should have been a software company that had a tightly controlled hardware specification.

      [i]04:28 But doesn?t it seem to not be in Jobs character to not have control over both the hardware and software so he can deliver the perfect experience?[/i]

      Just because he uses Intel, how is he giving up any control? A system is a lot more than just the CPU.
      __howard__
      • The CPU decision drives many of the ...

        ... associated hardware decisions. It will lock them into Intel chipsets.
        ShadeTree
    • Your speculation that Apple will design their ...

      ... own chipsets is absurd for the same investment reasons you stated for developing a portable G5. It is too large an investment. They will lock OSX using firmware but will be offering the same hardware as other PC vendors. It remains to be seen how long they can charge a premium price for the same hardware.
      ShadeTree
  • It's the Cell, stupid!

    IMHO Apple made a strategic mistake. Transitioning from the PowerPC to the new IBM-Sony-Toshiba CELL (which has a PPC core) would have been much more radical and provided out-of-this-world performance. And since IBM has already announced a significant open source Cell-SDK effort there would have been no end of folks developing interesting apps. As good as Intel is, its' very size and the fact that size is tied to the Wintel franchise means that they can only be so-radical.

    Comparing the CELL roadmap (from both Sony [Kutaragi] and IBM) with Intel's is like comparing a baby supercomputer set to exponentiate in power and performance with a steady high performance processor that continues to evolve. Let me put it more bluntly: Why aren't this generation and the next generation Xbox, Sony, and Nintendo game machines going to run on Intel chips? Why are they going to run on (at least this generation) on PowerPC variations? Combine that with the raging tiger that Nvidia has built for the PS3 (the RSX) and I'm at a loss why Apple doesn't build a CELL-based laptop, or at least one with a CELL co-processor (I know, they seemingly can't get a low heat G5 out of IBM, or their latest and greatest PPC chips). Maybe.
    kilamanjaro
    • Cell is not for desktop computing

      If you understand Cell architecture, you will not make this statement. Cell is designed for processing rich media content and broadband services from the ground up. It is not suitable for desktop computing running business applications. Comparing with other desktop processors for running this kind of tasks, Cell won't standout.

      Apple knows this very well so it didn't fall into the Cell hype.
      vancejen
    • It would seem that your vision of the Cell ...

      ... and it's place in the ECO system differs from Steve Jobs and many other industry insiders. I just wonder if your credentials are also as disparate.
      ShadeTree
    • Cell ? Heat?

      Do you suppose this has anything to do with music/dvds etc. I have heard Intels newest hardware is designed to keep the pirates at bay.
      I'snt music Apples mainstay, and isn't Apple just a niche in the computer market?
      pgbev
  • Big Endian vs Little Endian

    I brought it up elsewhere, but if this is where questions are being raised, what about Big Endian conversion to Little Endian? That could make conversion and data files a bit interesting.
    __howard__
  • Apple dumps IBM for Intel

    It doesn't bode well for the tech community when reporters are interviewing each other instead of going to the source.
    thomasaaa1
    • Amen

      Seriously, let's answer some of these questions instead of asking them, yeah?
      gabe_z
      • Nah

        I'd much rather read yet another ZDNet article that talks about how
        other ZDNet authors are reacting in their own articles. Now that's
        some exciting reading!
        tic swayback
  • Its the software, stupid .... all the software ..... follow the money

    Insanely great is hard to keep up when you do everything your
    own unique way.....it turns out to be inately limited too.....

    The great advantages of virtualization are still being ignored.
    The ideal PC configuration is a Mac and state-of-the-art PC for
    "ability to run software reasons" having nothing to do with
    hardware. It will be some time, beyond infinity when all
    applications run on a MacTel as well as a WInTel ..... it is a
    national producivity issue, scientific productivity issue (for
    example) and not just a market share and easy profitability
    issue.
    alanrbriggs
  • ZDnet is having a field-day with this news!

    Glad to oblige you morons!


    Buy a Mac and be done with IT.
    An_Axe_to_Grind
    • So I take it from your statement if you ...

      ... buy a Mac you will be run out of the IT community!
      ShadeTree
  • Nope. IBM dumped Apple for gaming consoles

    IBM went to where the money is. They will sell far more units it Sony and Microsoft without having Jobs whining "where is my low voltage G5".

    Apple is sitting in the dust behind X-Box 360 - now there is a low blow!
    quietLee
  • IBM in trouble?

    IBM sold it's Hard Disk fab to Hitachi a like 2 or 3 years
    ago.

    IBM announced it was looking to leave the computer
    business and was looking for
    a buyer like last year.

    IBM enters into a deal with Sony and Toshiba to
    fabricate Cell processors for gamers.

    IBM loses PPC deal with Apple.

    Is IBM is in some sort of financial trouble?
    Is moving it's operation to Asia?
    janjop
  • IBM in financial trouble?

    IBM sold it's Hard Disk fab to Hitachi a like 2 or 3 years
    ago.

    IBM announced it was looking to leave the computer
    business and was looking for
    a buyer like last year.

    IBM enters into a deal with Sony and Toshiba to
    fabricate Cell processors for gamers.

    IBM loses PPC deal with Apple.

    Is IBM is in some sort of financial trouble?
    Is IBM moving it's operation to Asia?
    janjop
  • What about viruses?

    Hellooo Steve J. Macs are virtually free of viruses now. Since 99.9% of viruses are written for Intel it looks like hackers will have a head start on infecting OS X.
    kmeyers