Apple can be Intel's deal break for the future
Apple's iPhone success makes it a formidable foe but the Cupertino-based company can also be a beneficial ally. Intel, for instance, has been working hard to become a major Apple supplier in the years to come.
However, there seems to be brewing debate among analysts over whether Intel really needs that partnership, with some arguing Intel cannot afford to be kicked out from the future of Apple Mac, while others suggest the company will do just fine.
In a report by Alpha Max's Seeking Alpha, the author argues that Intel should not be worried if Apple cuts it from the production of future Macs, the reason being that Apple can never truly move away from Intel. Apple may be able to cut Intel from other Mac production but not entirely from the premium line up. Intel's chip architecture caters to the needs of Apple's loyal high end users. Chipmaker ARM will not be enough to power high-end Macs and Apple risk losing its customer-base.
“However, a partial shift to ARM for the Macs is always possible, and I expect Apple to exactly do that. If for low-end Macs Apple uses ARM-based chips going forward, I don't think Intel should worry," said Alpha Max.
The article further explained, "Because at the end of the day both Apple and Intel need sales and profit growth amid a fiercely competitive environment, and the AppTel (I've borrowed the idea from WinTel) combination that's gradually unfolding will be a win-win situation for both the companies."
However, The Motley Fool argues that Intel should be paranoid. According to its report, Intel needs to defend its business with Apple and its role in the production of the Mac. As Ashraf Eassa argues, "At the end of the day, although Apple isn't a 10% customer of Intel's, the revenue that the chip giant sees from selling processors to Apple is likely quite material."
"I believe that as long as Intel can continue to deliver products that offer the kind of performance and power consumption that Apple is looking for, then it should continue to ‘own’ this business for the foreseeable future."
Nonetheless, it appears Intel does not need reminding how important Apple is to their business. According to Venture Beat's report, the company has invested in an army of people to work on the next iPhone's chip. Sources familiar to the matter said that Intel has more than 1,000 people working to equip the 2016 iPhone with its highly praised 7360 LTE modem chip.
Contact the writer at feedback@ibtimes.com.au, or let us know what you think below
