Apple Abandons IBM, Will Use Intel Chips

Apple chief executive Steve Jobs announces that Mac computers and other company products will use Intel processors instead of IBM PowerPC chips.
Apple chief executive Steve Jobs announces that Mac computers and other company products will use Intel processors instead of IBM PowerPC chips. (By David Paul Morris -- Getty Images)
By Mike Musgrove
Washington Post Staff Writer
Tuesday, June 7, 2005

Apple Computer Inc. said yesterday that it will stop using processors built by IBM in favor of Intel chips, which could help the company cut prices and offer more products but undercut Apple's reputation for going against the grain of the rest of the computer industry.

Intel has been so associated with Apple's arch-enemy Microsoft, whose Windows operating system runs mostly on computers with Intel-equipped computers, that the term "Wintel" was coined as shorthand for such computers.

The chip switch for Apple's Mac computers "probably looks scary to most traditional Mac enthusiasts who have always shown disdain for the 'Intel Inside' logo," said Lou Dunham, a co-owner of the Bethesda shop MacUpgrades.

But Apple chief executive Steve Jobs said at a San Francisco software conference yesterday that his company is dropping IBM's PowerPC products because Intel's lineup of forthcoming chips holds more promise. He said Apple did not know how to build the products it plans with chips planned by IBM.

Since Apple's Macs and Windows PCs have always used different types of processors, it has sometimes been tricky to compare their performance. Some Mac users said the move may broaden the appeal of Apple products by making it easier for shoppers to compare performance with PCs.

Jobs said the transition to Intel-built chips will begin next year and be complete by 2007. Apple has been developing a version of its operating system that will work on Intel processors ever since the company was fine-tuning the first version of Mac OS X, its current operating system, five years ago, he said.

In a written statement, Paul S. Otellini, president and chief executive of Intel, lauded Apple as "the world's most innovative personal computer company." IBM did not respond to calls for comment.

The Apple switch tightens Intel's dominance of the computer processor business; it already has more than 80 percent of the market. Apple's share of the personal computer market is in the single digits, so small that some analysts and industry watchers think the effect of the switch will be negligible to the bottom lines of IBM and Intel.

Even so, Paul Saffo, director of the Silicon Valley think-tank Institute for the Future, said that Apple's products hold such cachet that the switch could be a boon to Intel.

"It is enormous prestige to say your chips go into an Apple, even though the numbers are small," he said.

William Gorman, technology analyst for PNC Advisors, said the switch is potentially positive for Apple because Intel's size may allow it to offer lower prices and quicker product availability. "Intel has a record of more consistent reliability and availability than IBM," he said.

In establishing a relationship with Intel, Apple will have access to a wider range of products, Gorman said. Many have speculated that the Cupertino, Calif.- based computer maker has a video version of its popular iPod digital music player in the works, for example. Intel makes chips designed for that type of gadget.

Rumors that Apple would switch to Intel have been around for years, but some Mac users wondered yesterday if Apple is running the risk of alienating its core fans, the Mac users who obsessively pore over every move the company makes.

Mount Pleasant Mac enthusiast Bill Morocco said he initially found the news "kind of creepy" because he likes the fact that his Mac PowerBook is different from other systems. But he also admitted that he doesn't spend much time thinking about what kind of chip Apple puts in its computers.

"I do video editing and the best way to do that is with a Mac," he said. "I never think about the chip being built differently."

With recent hits like iPod on his hands, Jobs has inspired great credit with Wall Street analysts and Mac fans. Even if the move appears to move the company a step closer to the Wintel platform, some Apple aficionados figure by now that whatever Jobs does with the company must be right.

"If Apple deems it a smart move to make this transition, I'm all in favor of it," Phil Shapiro, a Mac enthusiast in Arlington, wrote in an e-mail yesterday. "Steve Jobs -- and his board of directors -- are very smart. Their wisdom becomes revealed to us over time."


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