Edible Apple

Earlier this week, CNET posted an interesting take detailing why Apple decided to abandon PowerPC in favor of Intel chips in 2005.  While Steve Jobs publicly stated that the Intel’s roadmap was more in line with what Apple was looking for and where it wanted to go (i.e more efficient chips), CNET got a hold of a former IBM executive who has a slightly different take on things.

While not necessarily disputing Apple’s publicly stated reasons for moving over to Intel, this anonymous and former IBM executive brings to the table the idea that Apple moved away from the IBM/Motorola crafted PowerPC design because Intel was able to offer cheaper pricing on account of its larger customer base.

Apple was paying a premium for IBM silicon, he said, creating a Catch-22. IBM had to charge more because it didn’t have the economies of scale of Intel, but Apple didn’t want to pay more, even though it supposedly derived more from an inherently superior RISC design as manifested in the PowerPC architecture.

And from IBM’s end, dealing with Apple was a challenging financial endeavor.

For IBM, the business with Apple was a financial sinkhole because the company had to invest a lot of money in chipsets, compilers, and other supporting technologies but could only take a small percentage of the overall PC processor market, he said. So, in the end, it was impossible to make money.

Why only a small piece of the processor market? Apple insisted on double sourcing (IBM and Motorola). So, from the start, this left IBM with about half the market it could have had. This, he said, was an enormous financial burden. Paraphrasing the ex-IBMer: Intel was a single company with the lion’s share of the market. While two companies–IBM and Motorola–had to divvy up a much smaller share of the market, while still investing, individually, tremendous amounts of money. And Apple played one against the other, according to this person.

Lastly, some have also speculated that Apple made the transition to Intel because running Windows on a Mac was an eventual goal for the head honchos over at Apple.  Either way, and no matter what motivated Apple’s decision, there’s no denying that Apple made the transition to Intel almost seamlessly and relatively quickly to boot.

So there you have it, another piece of Apple lore for your enjoyment.

Sidenote: How funny would it be if the anonymously quoted former IBM executive was Mark Papermaster?

You can check out the full CNET article over here.