Does Apple's latest hire signal more chip making in future?
Surely by now you’ve seen some of the flat mainstream media reports on IBM’s suit to block an employee’s move to Apple. And by now, you probably know the facts: Mark Papermaster, a 26-year IBM veteran who worked on the PowerPC family and most recently worked in IBM’s blade server division, is being sued by Big Blue for allegedly violating a non-compete agreement that prohibits him from working at any competitor for a year following his exit from IBM. If the agreement is upheld, Papermaster may not be able to work at Apple until late 2009.
The questions being presented by most mainstream media outlets have to do with if IBM will win the suit. What should be asked, however, is what’s prompting Apple’s interest in Papermaster.
The agreement, signed by Papermaster in 2006, aims to protect IBM IP and focuses on three main points: that Papermaster may not work at or for a "significant competitor" to IBM, a "major competitor" to IBM, or a business entity that competes with an IBM business unit or division. So, judging by the wording of the agreement, Apple would have to be considered a competitor to IBM for IBM to win this suit.
Is Apple about to launch a server effort that would make Papermaster’s work at IBM’s blade-focused group attractive? It’s doubtful that the consumer electronics giant would spend its resources there.
Could Apple be interested in Papermaster’s input on a cloud computing hardware infrastructure effort, perhaps in relation to its iTunes brand? Maybe. Apple’s iPod and iPhone lines are becoming more and more connected. And Tony Fadell*, Apple’s top iPod division exec, is leaving the company, which could signal a shift in strategy for iTunes from download-centric to more robust streaming. If Papermaster can beat the IBM suit, he’ll replace Fadell as Apple’s senior VP of devices, with responsibility for the company’s iPod and iPhone hardware-engineering teams.
Really the only place Apple and IBM arguably could be considered competitors is on the PowerPC front. Papermaster has been credited as being one of the key architects behind IBM’s PowerPC design, and he surely took a meeting or two (or 100) with Apple execs when the Mac maker was IBM’s largest PowerPC customer (before Apple’s move to Intel chips in 2005).
You’ll recall that Apple paid $278 million for PA Semi in April, bringing it into the chip-making realm. PA Semi design’s specializes in low-power PowerPC MPUs for military market embedded systems.
Speculation at the time of the PA Semi buy was that Apple would cut out Intel by bringing chip making in-house and therefore allowing it more control over its Mac, iPod, and iPhone designs.
Is the Papermaster hire a sign that Apple may soon expand on the PA Semi buy, building out a PowerPC-based or other chip architecture-based portfolio for its products? It’s possible that is what prompted Apple’s interest in Papermaster. And adding to that theory, Apple is openly hiring CPU engineers (just look at its job board). Well known among the EE set, putting Papermaster in a prominent position at Apple could be a way to entice other engineers to join the company.
What do you think about Apple’s effort to hire Papermaster? Is it a precursor of more in-house Apple chip work? And should the IBM non-compete agreement be upheld? Share your thoughts below.
*Updated, Nov. 5: In a statement on its Papermaster hire, Apple confirmed yesterday Fadell and his wife, Danielle Lambert, VP of human resources, are reducing their work at the company for personal reasons. Fadell will remain at Apple as an advisor to the CEO. Lambert will depart the company at the end of this year after a successor is in place. This blog post originally cited reports on the executive changes.
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