Recent rumors have emerged suggesting Apple intends to purchase ARM holdings for $8 billion. As Apple has $41 billion in cash, it would be a done deal if they wanted to move. Interesting thoughts:
- ARM does not produce any chips itself, but licenses its technology to 191 companies, including Texas Instruments, Samsung, Intel, Apple, Nokia, and Infineon. source
- List of ARM licensees: http://www.arm.com/products/processors/licensees.php
- According to 2007, estimates the ARM license costs only 6.7 cents per chip. 2010 estimates expect 4.5 billion products shipped, which dictates an annual revenue of $310.5 million in license fees alone. The license fees could be manipulated to use as leverage against Apple competitors.
- Licensing information could also give Apple important data about its competitors and their low-power computing strategies. Consider the recent Google acquisition of Agnilux, for example. If Apple knows how many licenses you purchase, they can gain insight into your success and strategy.
- Amazon’s Kindle runs a Freescale ARM-based processor. HTC uses ARM-based processors. Nokia uses ARM-based processors. Blackberry uses ARM-based processors. See where this is going?
- Apple is currently embroiled in patent suits with both HTC and Nokia. Gaining control over valuable ARM IP gives them even more leverage.
- If Apple buys ARM Holdings, it further represents their believe that the future is mobile.