Apple Exec Confirms In-House Chip for iPhone Enroute

By  |  Monday, September 15, 2008 at 11:25 pm

While some scratched their heads when Apple scooped up semiconductor company PA Semi back in April, analysts suggested that Apple may have been looking to take its portable device chip manufacturing in-house.

Those analysts now appear to have been correct. In a rare leak, Apple’s chip team senior manager Wei-han Lien revealed on LinkedIn over the weekend that he was working on an ARM processor for the iPhone, the New York Times’ Bits blog claims. It should be noted that we can’t confirm this as Lien’s profile appears to either have been removed or possibly set to private, although a Google cache result from August 15 appears to suggest that this link was valid at one point.

Steve Jobs confirmed Apple’s plans for PA Semi in June, saying it would be tasked with developing chips for iPods and iPhones. Using the chips made sense: the company had made a name for itself by producing high-performance chips with low power consumption. It was also a blow to Intel, whose Atom processors have had their share of problems, and suffered from performance and cost issues.

Intel’s processors never made it into the iPhone — Samsung’s ARM processors power the unit according to analysts — but its not too out there to argue that they had hopes to get inside the popular devices eventually. With the iPhone an obvious success, Intel could stand to make quite a bit off of money by expanding the partnership to Apple’s mobile devices.

But taking out the middleman plays into Apple’s culture of silence. With a chipmaker in-house, there would be less of an opportunity for leaks, and would be able to customize the processor to the devices exact needs, possibly reducing costs elsewhere and increasing profit margins.

Either way, the move now brings the PA Semi acquisition full circle, and arguably puts Apple in a position to begin to advance the capabilities of the iPhone much faster than it would have if it would have continued to use a third-party for the iPhone’s processors.

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