Steve Jobs, Apple's chief executive and co-founder, is expected to explain the shift today during a keynote speech at the company's annual conference for software developers in San Francisco, the industry executives said. Paul Otellini, Intel's CEO, may take part in the presentation, an industry executive said.
Apple recently briefed IBM and other major software partners on its plans, according to people familiar with those briefings. On the other hand, some Apple watchers said that, given Mr. Jobs's mercurial reputation, they won't be sure a change will happen
until a formal announcement.
The Wall Street Journal reported1 on May 23 that the companies were in talks that could lead to Apple's adopting Intel microprocessors. The article said the announcement could come as soon as today's conference. CNET Networks Inc.'s News.com on Friday reported that Apple will announce the transition plan today.
It reported that Apple will move lower-end computers such as the
Mac Mini to Intel chips in mid-2006 and higher-end models such
as the Power Mac in mid-2007. Industry executives over the
weekend also described a transition that will extend into 2007.
Spokespersons for Apple, Intel, IBM and Freescale, which is based in Austin, Texas, said their companies had no comment.
Apple's partnership with Intel, while a high-profile breakup for Apple and IBM, wouldn't be disastrous for Big Blue. IBM has recently persuaded Microsoft, Sony Corp. and Nintendo Co. to use its chips in their next-generation video-game machines, a business that is expected to dwarf sales for Apple's hardware over the next few years. Microsoft had been using Intel chips and Sony its own chips, while Nintendo was an IBM customer that Big Blue wanted to retain.
It's also unlikely that Apple's shift to Intel chips will trigger a dramatic change in the PC industry's balance of power. Apple remains a niche player, with only 2.3% of new-PC shipments in the first three months of this year, according to International Data Corp. One reason is Apple's meager presence in the huge corporate market, where Windows PCs dominate.
Yet Apple is thriving in ways others in the PC business aren't. Unit sales of Macs increased 43% in the first quarter, outpacing the industry growth rate by nearly four times. One selling point has been the rarity of virus programs that successfully target the Macintosh operating system, an advantage that a change in chips isn't expected to affect. Apple's hugely successful iPod music player has also enabled the company to diversify its business and help attract first-time computer customers. The Mac business also has been aided by innovative products like the one-piece iMac and Mac mini. A person close to Apple said Intel's chips could enable the company to create powerful new Mac products that are even smaller and thinner. IBM's chips, partly because of the heat they give off, have held back Apple designs for some compact products, this person said.
Apple executives have considered adapting its popular operating software for Intel chips and selling it as a separate product in competition to Windows. That idea has always been rejected out of fear it
