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ARM: Apple has no reason to buy us

updated 01:45 pm EDT, Thu April 22, 2010

ARM chief says licensing enough for Apple

ARM CEO Warren East quickly moved to defuse rumors of a possible Apple takeover with a response to the suspicions. He noted that ARM's inherent nature, where it licenses architecture rather than make the chips themselves, means there would be little incentive to actually buy the company. Apple is already free to modify the design.

"Common sense tells us that our standard business model is an excellent way for technology companies to gain access to our technology," West said to the Guardian. "Nobody has to buy the company."

ARM's licensing system is designed to be relatively flexible and includes both fixed and flexible patterns. The Samsung-designed chips in current iPhones and iPod touch players, are based on a fixed ARM design that only has slight customizations to meet particular needs. A more open option lets licensees actually change the architecture itself past the original license; Apple has the rights to this and may have adjusted the Apple A4 for power efficiency, although it largely clings to the reference Cortex-A8 also used by Nokia's N900 and a few other handhelds.

As Apple already owns PA Semi, it can make a large number of the changes without needing outside help. Any acquisition would also face legal implications, as the company would either have to continue offering equal licenses to rivals or risk lawsuits from phone makers if it cut off licenses.



By Electronista Staff
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Comments

  1. WiseWeasel

    Junior Member

    Joined: Apr 1999

    +3

    Hmm

    Maybe Apple is worried that Google or Intel was going to buy them...

  1. Feathers

    Grizzled Veteran

    Joined: Oct 1999

    +1

    Folding at home

    There would be nothing to stop Apple from buying and then folding the company to acquire or control their IP. There is no law that requires that a company must sell or license to whoever asks. A company can only honour existing contracts if a company exists. "Buy it and bury it" is a great way of avoiding such situations and is quite common in the tech sector.

  1. ZinkDifferent

    Fresh-Faced Recruit

    Joined: Jan 2005

    +4

    Full Circle

    Most people aren't aware that Apple founded ARM back in 1990, and it's CPU powered the Newton series. If this were to happen, it would be just bringing them back into the fold.

    Cutting off competitors from a CPU resourcers would be one reason to do so; profiting from competitors' vain efforts to compete would be an alternate reason - Apple does have good reasons to buy them, which doesn't necessarily mean that they will.

  1. testudo

    Forum Regular

    Joined: Aug 2001

    +7

    Re: Full Circle

    Most people aren't aware that Apple founded ARM back in 1990,

    Actually, they co-founded it with several other companies. It isn't like how they 'founded' Claris.

    Cutting off competitors from a CPU resourcers would be one reason to do so; profiting from competitors' vain efforts to compete would be an alternate reason - Apple does have good reasons to buy them, which doesn't necessarily mean that they will.

    Based on your remarks, one would argue that the competitors would have larger reasons to buy them. They could cut Apple off from these resources.

    The fact that no one does this is most likely due to the fact that their licensing agreements wouldn't allow them to.

  1. testudo

    Forum Regular

    Joined: Aug 2001

    +6

    Re: Folding at home

    There is no law that requires that a company must sell or license to whoever asks. A company can only honour existing contracts if a company exists. "Buy it and bury it" is a great way of avoiding such situations and is quite common in the tech sector.

    Perhaps, but I seriously doubt all these companies that use ARM technology would do so if their contracts allowed for such a simple ploy. Again, MS could just come in, buy it up, and laugh at Apple.

  1. testudo

    Forum Regular

    Joined: Aug 2001

    +7

    Apple and ARM

    And speaking of Apple and ARM, most people probably aren't also aware that selling ARM stock over to course of years was one of the few ways Apple stayed 'profitable' (or less non-profitable) during the lean years.

  1. bfalchuk

    Fresh-Faced Recruit

    Joined: Jul 2003

    +5

    I'm aware

    testudo, I was thinking that the whole time I've been reading these reports - Apple was able to stay in the black for a few years because of their share of ARM Holdings. Each quarterly resutls release was accompanied by discussion of how ARM shares are basically propping Apple up.

    I think you're spot on - the license agreements are likely to stand in the way of a "buy and bury" approach, so buying them is a waste of cash. Better to buy some select niche experts on power usage, graphics performance, radio reception, etc rather than a general design and license shop.

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