The London Evening Standard is reporting that Apple is considering purchasing UK chip designer ARM Holdings.
The report notes that Apple is ARM’s biggest customer, and speculates that Apple wants to take chip design in-house. Given that Apple built its own A4 chip for the iPad, based on ARM architecture, this wouldn’t be a completely surprising move. Especially seeing as more and more of its business centres on ARM-based hardware (iPhone, iPod, iPad).
The Evening Standard reports that traders expect a bid would come in at £5.2 billion (around $8.7 billion), which Apple can likely afford, given its recent earnings report – it has $41.7 billion ($45 billion) in the bank.
Apple was originally involved in the development of the ARM architecture in the early 1990s, with the ARM610 chip powering the Apple Newton PDA. Apple sold off all its shares in the company in the late 1990s after discontinuing the Newton, but re-adopted ARM processors for the juggernaut that was to be the iPod in 2001.
But Apple purchasing ARM would not just have an effect on Apple-fanboys; ARM chips are currently used in billions of devices around the world, including netbooks, mobile phones, gaming consoles, and just about anything that’s small or portable. Apple owning the rights to that technology could profoundly change the game for its competitors.
ARM currently licences its technology to manufacturers to produce its chips, so if Apple were to buy the company, they would save themselves the royalties. Likewise, it could raise prices for its competitors to access the processor designs.
It’s unclear at this early stage whether such a takeover would be allowed, given the implications for the wider mobile technology industry.