Wall Street Journal - Apple Eyes Shifting Macintosh Line To Intel Chips

The Wall Street Journal ^ | June 4, 2005 | DON CLARK and NICK WINGFIELD

[D-fendr]

FWIW, I ran the hardware/chip/driver concern past someone who knows a lot more about the history than I. His response:

The kernel came from the Intel side in the first place - Darwin runs on Intel already. It's really native to Intel. Remember they had to do a lot of porting to get BSD/Mach/NEXT to run on PowerPC. Maybe Apple's been working Cocoa for a smooth transition to CISC already. The GUI can be rewritten (if it hasn't been already). You can be sure Apple has a prototype Mac using an Intel CPU on a bench somewhere.

I think the big draw is the fact that Intel is innovating and IBM is not - not as far as Apple's needs are concerned. Apple is a PC manufacturer (the only difference being the CPU and motherboards) and going to Intel makes good sense. It allows Apple an equal foothold in the PC market. It washes out the hardware platform difference and allows Apple to compete directly with Microsoft on the OS level - and eat their lunch I think. This has got to scare the tar out of Bill.

Apple has lots of drivers already - all the peripherals. All the drivers for Intel hardware are already there for BSD. It would be a hurdle, but not a show-stopper. Manufacturers are providing Linux drivers more and more, why not add MacOS now that the platform is the same? Apple could easily integrate manufacturer's drives into Software Update so the user doesn't even know what's going on. If you take the Win out of Wintel, things get a lot simpler and certain.

If user's want a totally seamless box without mix-n-match, buy the box from Apple. There'll still be making them.

[ThinkDifferent]

The major problem is that Apple doesn't own PPC, IBM and Moto do, and why would they license it to Intel?

Yeah, I'm not sure about that either. It's possible that the Apple/IBM/Moto contracts stipulate that Apple can go to another vendor for PPCs if certain criteria aren't met. Or it's possible they paid IBM a lot of money recently for the rights. After all, a prerequisite of any Intel-switch theory is that IBM has abandoned interest in general-purpose desktop PPC chips. (In which case, I wonder what it means for their high-end POWER servers. Will they move everything to Cell derivatives?)

[bigsigh]

you have my proxy, I'm going to show some houses.

[Golden Eagle]

And if you could have it for 150 bucks without any new hardware, you'd really honestly seriously consider them there innovative, outstanding products.

Sure will, I don't have to purchase a Ferrari either to be a fan of their designs. However if they ever price one where it is a practical choice for me to purchase one, say at 1/10 the current cost, I'm sure I will. But what I really wish is that I was a man of your obvious means, so I could purchase whatever I wanted whenever I wanted it, whether I really needed it or not, must be really nice. Was that humble enough for you?

[ThinkDifferent]

I agree that *technically* it's not that much of a problem to run OS X on Intel. Heck, I'm pretty sure there are already current OS X builds running on x86 in Apple's labs. The problem is marketing. Apple can't switch immediately even if they had the hardware ready to go, because developers need time to port. (Yes, in theory it's mostly just recompiling, but in practice it won't be). During this transition Apple's hardware sales will be roughly zero, and they'll have to find a way to deal with their existing customers, who won't be happy that their expensive PPC hardware has just been rendered obsolete.

It washes out the hardware platform difference and allows Apple to compete directly with Microsoft on the OS level - and eat their lunch I think. This has got to scare the tar out of Bill.

Until Bill realizes that he has the most popular 3rd party Mac software under his control, and promptly kills Mac Office. Sure there's Pages and Keynote (and presumably Apple has a spreadsheet ready to go), but the damage to mindshare would be huge.

I just don't get it. If Apple was going to switch, the time would have been 2001-2002 when Motorola's G4 was going absolutely nowhere and Mac price/performance was *far* worse than Wintel. Today the G5 compares much more favorably to x86, and IBM has gotten wins on all 3 consoles. You'd think this would be promising for the PPC architecture. I suppose it's possible that IBM now wants to focus exclusively on console CPUs which are unsuitable for desktop use, but I can't believe it would be more cost-effective for Apple to go to x86 than to persuade IBM to reconsider.

[D-fendr]

Very good points, thanks. I'll use these points as devils advocate with my friend.

It will be interesting to see how Jobs handles these problems - if this actually happens.

[Bush2000]

So much for your little-endian vs. big-endian theory, Hal... BWAHAHAHAHAHAHAHAHAHAHA!!!

[Golden Eagle]

Intel sells chips only, not software and services that compete directly with Apple's products like IBM does. Intel has plenty of capacity, and likely won't limit Apple's chip freatures or production if/when Apple starts moving into markets that compete with IBM Global Services like some have accused IBM of doing. There was just an obvious conflict of interest, that Jobs didn't feel Apple could accept anymore, else there's no reason to take the risks that you've outlined. I do agree that they should have probably made the move before, if not refused to partner with IBM from the beginning based on the bad blood, but I have to give Jobs the benefit of the doubt, and at this point he's proven he can lead Apple through major architectural change. This will be no different.

[Golden Eagle]

So much for your little-endian vs. big-endian theory, Hal...

Oh let him be, he's obviously in mourning today. However, it's been quite enlightening to see the doubt and skepticism heaped on Job's decision by the supposed Mac faithful. I attribute it to 2 things, first being an ego that refuses to accept the reality of the situation, and second being an insatiable desire to attack anything remotely "Wintel" despite the obvious advantages of the platform such as the Pentium M processors. If it continues, I expect IBM to quickly start marketing a new PowerPC system running Linux, and many of these supposed Apple/Jobs fans to rush to them immediately.

[Bush2000]

If it continues, I expect IBM to quickly start marketing a new PowerPC system running Linux, and many of these supposed Apple/Jobs fans to rush to them immediately.

This is all just theater. Apple was and remains a hardware company. I doubt seriously that they will move to Intel. However, just for conjecture, one interesting possibility is that Apple is merely trying to expand their OS share by marketing OSX for Intel. But that would undoubtedly cannibalize their existing PPC hardware platform, so you have to question the wisdom of such a move. I would also question how Apple is going to handle driver issues. Apple is used to having almost complete control over the hardware spec. On an Intel platform, it loses control and would (therefore) have to not only accomodate third-party drivers but deal with the predictable lousy hardware problems that they now criticize Microsoft for. Granted, they could have some kind of certification program (like Microsoft) and not permit unsigned drivers whidh haven't passed rigorous testing -- but this will greatly reduce the usefulness of the OS and almost assuredly create compatibility issues. No, the driver issue is one of the big reasons that I doubt Apple will pursue Intel.

On a slightly orthogonal note, I've always been surprised that Apple never created an alternate Shell for Windows. Granted, that wouldn't serve their PPC customers all that much but it would potentially create a HUGE market for Apple's so-called "better usability". The downside is that it reduces the likelihood that Windows customers will move to Mac hardware. But they're not moving to Mac hardware, anyway, due to the single supplier problem.

[Golden Eagle]

Thanks. I believe it will be announced, if not Monday no later than the next 18 months. Mainly because I thought they should have done it long ago. Not that Apple is going to initially market a shrink wrap version of their software for generic PC clones, but that they will first only integrate the Intel processor into their designs. Then, over time, as they obtain driver selection and stability as you mention, they will license their design to a few select vendors to offer for sale to compete with the Linux sales going on at these same vendors, say HP, Dell, and Sun.

They have a few needs that Intel can provide, namely chips first, an established market with wide selection of distribution points, and DRM which is being embedded into the future Intel chip line. Sun is now selling Intel, so is HP, Dell only sells Intel, so Intel is becoming the vendor neutral supplier to all the big vendors minus IBM, who will now be out of the chip business completely except for their own systems, and the game consoles, but the game consoles are mostly running on Cell which will be manufactured by Sony and Toshiba as well.

Well tomorrow will be here before we know it. If it is announced, the two big questions are, how will Jobs frame it, and will he be booed by his supposed supporters.

[Golden Eagle]

Sun is now selling Intel, so is HP, Dell only sells Intel, so Intel is becoming the vendor neutral supplier to all the big vendors minus IBM

I meant this in terms of *nix sales, in case anyone was confused.

[Golden Eagle]

One other thing to consider, that may be putting additional pressure on Apple: Microsoft will soon be pumping out lots and lots of Xbox 360 systems at loss leader pricing, and pirated ports of OSX could be quick to follow as the Xbox will have the same PowerPC core processor. This gives the potential for people to be getting their OSX for cheap, and little if any money back to Apple. This could therefore be seen as a pre-emptive strike by Apple, to move to a fully proprietary system based on Itanium for their high end systems, and pentium M for their low end, neither of which are available elsewhere at commodity pricing. I can hear the Mac crowd now, "I knew Microsoft was behind this!", LOL.

[Bush2000]

That's a fascinating consideration. But I wonder whether the XBox 360 will actually be much less expensive than Apple's bargain basement machines and therefore attract OSX users. XBox 360 is expected to start somewhere around $400 (pricing hasn't been released yet -- probably to keep Sony off-balance). That isn't much less than the Mac Mini. Plus, you're not gonna be able to convert an XBox 360 without having somebody modify the physical hardware. It's not like you can do it completely with software (heck, anything is possible, but I wouldn't bet on it -- MS is very keen on raising the bar against mod-chippers). Still, very fascinating. We'll just have to see what Jobs has to say.

An even more interesting question (as you suggest) is what the Mac faithful will have to say, if Apple does in fact turn to Intel (which I'm skeptical about, to say the least). They've been bashing Intel hardware for years as low-grade crap (unjustified, IMO). If Jobs opens the Apple world to Intel, there's going to be a lot of crow on the menu for Mac fanatics.

I agree that Apple should have made this move years ago. They would have been able to leverage the economy of scale inherent in having Intel, AMD, and countless other hardware designers working for you without paying them a dime. But, no, Jobs and all the other effete snobs at Apple did a great job of shooting themselves in the foot and relegating themselves to the miniscule "education market". It remains to be seen whether Apple could move from being a dedicated hardware company to being a partner with the many Intel/AMD-focused OEMs.

[Golden Eagle]

Yes, it is all very interesting. While you make a good argument that a $400 Xbox isn't much different than a $500 Mac Mini, keep in mind that a $350 Xbox (price I've heard rumored) could provide two distinct features, Xbox + OSX, and the fact that MS will be pumping enough of them out to essentially flood any potential OSX market with compatible hardware. Whether OSX support could be done with software only is another good question, but the Pear PC project does (apparently in violation of Apple's license) allow OSX to run on Intel via software only, and Apple hasn't shut that operation down yet either because they can't or don't care to. But if code exists to run OSX on Intel right now, seems getting OSX to run on a PPC system could be much easier.

I'm surprised you're skeptical about the move, seeing as you agree they should have done this long ago. Jobs should have never trusted IBM, after all the animosity he stirred up for them back in the 80's, and it actually made me call his credibility into question when he did it. I was an Apple salesman for MicroAge back then (part time, commission only), and we were fed a steady diet of Jobs' jabs at IBM. Bottom line looks like IBM just strung him out long enough to leave them in this lurch, until something they thought was better (lunix) came along for their processor line.

If it does happen, I don't know if the Mac folks that have been pis poring Intel hardware all this time will eat crow though. I think this whole rumor mill episode has made it obvious a lot of them hate Wintel more than they like/trust Apple and Jobs. As I said above, if Apple does announce a clean break from IBM's chips, and Jobs gets jeered on stage, I expect IBM to rush out PPC desktop that runs Linux, and try to snatch up those that fall into that camp. The only thing that would probably stop that from happening would be IBM, who could look at it and say there's just not enough of a market for PPC desktops to justify it, although if there's anyway that IBM could launch a PPC/Lunix unit, they'd love to, just ask Nick Danger who has predicted huge gains for such a device starting over in China. Jobs vision has historically been to provide both hardware and software, in a proprietary format that locks customers in, and even if he switches to Intel that is the philosophy he natively brings. However if he announces that is what they are now going to do, simply change the chip to Intel, he runs the risk of looking desperate, a chump who fell for IBM's tricks and is now crying to Intel.

My guess if/when he announces it, he'll come out guns blazing against IBM, accuse them of undermining Apple, and announce some sort of partnerships with other vendors like HP to expand the Apple product line into new markets, something that couldn't be accomplished without going with Intel. He'll probably have an Intel prototype chip on display running the current Tiger in emulation mode faster than his current G5 can do.

At least that's what he should do, if he doesn't want to risk losing those customers during any proposed transition. Anything less, he could have a riot on his hands based on the anti-Intel propaganda that's been fed to those people all these years. And the fact that some of them don't want Apple to grow in market share, else they feel less "special". Or who knows, your gut could be right and it's all a sham. I just can't help not to think it is going to happen, when I'm reminded of things like these.

[Incorrigible]

Now that's funny!

[Golden Eagle]

Better save it now, that site may be overloaded come tomorrow, LOL.

[Golden Eagle]

NY Times this evening. Of primary interest is they seem to confirm the story. The rest of it is spinning it into a win for IBM, based in NY of course.

http://www.nytimes.com/2005/06/06/technology/06apple.html

AN FRANCISCO, June 5 - Steven P. Jobs is preparing to take an unprecedented gamble by abandoning Apple Computer's 14-year commitment to chips developed by I.B.M. and Motorola in favor of Intel processors for his Macintosh computers, industry executives informed of the decision said Sunday.

[ThinkDifferent]

But I wonder whether the XBox 360 will actually be much less expensive than Apple's bargain basement machines and therefore attract OSX users. XBox 360 is expected to start somewhere around $400

Yeah, but the Xbox has 3 3.2GHz PPCs versus a single 1.25/1.4GHz in the Mini. Even at $500 I'd pick up at least one if they could run OS X or Linux (which as you note Microsoft will try very hard to prevent).

An even more interesting question (as you suggest) is what the Mac faithful will have to say, if Apple does in fact turn to Intel

Some will be upset, most won't care. I agree that some have an irrational dislike of Intel due to their ties to Windows, but the vast majority would prefer an x86 Mac running OS X to a PPC box running Linux or Windows.

(which I'm skeptical about, to say the least)

Same here. The end result of Macs running on x86 is neutral or positive, but I don't see a way to get there that doesn't cause Apple a huge amount of pain. But maybe I'm not thinking different enough, we'll see in 18 hours.

[Bush2000]

I'm surprised you're skeptical about the move, seeing as you agree they should have done this long ago.

Well, there are a number of potential problems for Jobs under such a scenario. First, Jobs has literally got to change the culture of Apple from one of building proprietary hardware to making proprietary software. Don't underestimate how difficult this would be. Apple has been selling proprietary hardware/software for a long time. Hardware is what drives Apple. Not software. I don't think that Apple really understands software all that much, no matter what people think. I think it perceives software merely as a driver for its hardware business. But Apple can never supplant Microsoft selling hardware. Microsoft has never really been all that interested in selling hardware (other than mice, keyboards, and simplistic peripherals) because the real profit is in software. Consequently, Apple has a tough battle to convince not only its own employees but its customers that it's time to cede the evolutionary hardware path to OEMs.

Granted, Apple could try to become another Dell by selling Intel-based hardware -- but competing against Dell is no cakewalk. Dell is a hell of a competitor, it wrings every ounce of profit that it can from its partner relationships, and Apple would probably be forced into its usual "we'll take the miniscule high-end market -- our competitors can take the broad market" strategy that has gone so badly in the past. Guaranteed, Dell wouldn't just cede the high-end to Apple, either. Since Dell has established relationships with Intel and it will sell many more computers than Apple ever could hope to sell, Dell will have access to all the same hardware that Apple can get. Hence, the only way that Apple can really differentiate itself is with its operating system. Apple can try to make the claim that it's selling a superior product -- but that claim will be even harder to make, given the same underlying hardware.

So, where does that leave Apple? In my opinion, it means that Apple lifts a page from Microsoft's playbook: It shifts from being a hardware company to being a software company. This transition wouldn't need to happen overnight. Apple could make a commitment to shipping OS X for Intel. It could continue to advance OS X and ship its own hardware products based on PowerPC. But that's a tough balancing act, and it sends a confusing message to customers. How would Apple continue to sell PPC-based machines to current customers and admit that they're buying expensive boat anchors? Doens't make a whole lot of sense, so not sure how Jobs would pull that off.

Second, I'm not convinced that IBM could really pull off a new wave of desktop hardware/software based on PPC and Linux. Sure, servers. But there's nothing new there. IBM has been making investments there for years. Those machines don't really threaten Apple (and vice-versa) unless you think that OS X Server competes head-to-head with IBM, and nobody seriously thinks it does. PPC doesn't offer Linux any advantages. If the desktop Linux market were to rise, it would rise on Intel hardware, not PPC. Consequently, I don't see that argument as all that credible.

When you put all of this together, it's my opinion that either this is a sham in order to get price concessions from IBM on PPC chips. Or Apple is planning on becoming a software company. I just don't see any other alternative. Unless Apple is truly delusional and thinks that it can compete in the Intel hardware market against Dell -- or it's content to get a fragment of the Intel market versus a fragment of the PPC market. Time will tell. Lots of grist for the mill, eh?