Apple looking at dropping Intel processors from Macs

Apple Inc. is exploring ways to replace Intel Corp. processors in its Mac personal computers with a version of the chip technology it uses in the iPhone and iPad, according to people familiar with the company's research.

Apple engineers have grown confident that the chip designs used for its mobile devices will one day be powerful enough to run its desktops and laptops, said three people with knowledge of the work, who asked to remain anonymous because the plans are confidential. Apple began using Intel chips for Macs in 2005.

While Apple is now committed to Intel in computers and is unlikely to switch in the next few years, some engineers say a shift to its own designs is inevitable as the features of mobile devices and PCs become more similar, two people said. Any change would be a blow to Intel, the world's largest processor maker, which has already been hurt by a stagnating market for computers running Microsoft Corp.'s Windows software and its failure to gain a foothold in mobile gadgets. A move by Apple may lead others to follow suit.

"Apple is a trendsetter, and once they did their own chip many others may pursue a similar path," said Sergis Mushell, an analyst at Gartner Inc. "If mobility is more important than functionality, then we will have a completely different environment than we are dealing with today."

As handheld devices increasingly function like PCs, the engineers working on this project within Apple envision machines that use a common chip design. If Apple Chief Executive Tim Cook wants to offer the consumer of 2017 and beyond a seamless experience on laptops, phones, tablets and televisions, it will be easier to build if all the devices have a consistent underlying chip architecture, according to one of the people.

Bill Evans, a spokesman for Cupertino, Calif.-based Apple, declined to comment. Intel referred questions on Apple's plans to Apple.

Intel shares fell less than 1 percent to $21.73, while Apple was little changed at $582.85.

Apple announced the switch to Intel chips seven years ago because they ran faster and generated less heat than the products built by Motorola Inc. and IBM Corp. that Apple had used. The Mac maker has in the past few years acquired chip companies, added engineers and created designs based on technology from ARM Holdings PLC for its bestselling iPhone and iPad.

ARM, based in Cambridge, England, licenses chip designs and the technology behind them to phone-chip companies such as Qualcomm Inc. ARM shares rose 2.1 percent to 709.50 pence in London, after jumping as much as 5.8 percent.

No final decision has been made and Apple may opt to continue working with Intel for years to come. For Apple, the risk of turning its back on Intel is a repeat of its situation in 2005, when it had to abandon the PowerPC chips -- made by Motorola and IBM -- it had used in its Mac line.