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Amazon Considering Buying Texas Instrument's Chip Business 108

Posted by samzenpus
from the sale-on-graphing-calculators dept.
puddingebola writes "From the article, "Amazon is reportedly in 'advanced negotiations' to acquire Texas Instruments' OMAP chip division, bringing chip design for its Kindle tablets in-house, and helping TI refocus on embedded systems. The deal in discussion, Calcalist reports, follows TI's public distancing from its own phone and tablet chip business in the face of rising competition from Qualcomm, Samsung, and others, though Amazon taking charge of OMAP could leave rivals Barnes & Noble in a tricky situation.'"
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Amazon Considering Buying Texas Instrument's Chip Business

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  • Big Move (Score:4, Informative)

    by roidzrus (2739093) on Monday October 15, 2012 @11:06AM (#41658041)
    This is a big move for Amazon, especially considering their Kindle doesn't necessarily demand huge amounts of performance, especially not in comparison to the iPad and other high-end Android tablets. I never really thought they would go this way, but now I can't help but wonder if they're going to expand toward phones as well. It seems that they could have just as easily sourced chips from Qualcomm unless they had something huge planned.
    • by Hadlock (143607)

      It signals a broader expansion in to consumer electronics. You can only eek out so much performance and battery life from generic hardware.

    • by rtb61 (674572)

      The "Patent Wars" heat up and if you don't think all this and other recent manoeuvring is all about patents and Apple's triggering of the "Patent Wars", then you really aren't paying attention.

    • This is a big move for Amazon. I think this might be them trying to bring hardware in house to make there tablets more high end to compete with the iPad at a cheaper price point.
    • by freman (843586)

      I didn't even make it through the title without exclaiming "No!"

  • Amazon taking charge of OMAP could leave rivals Barnes & Noble in a tricky situation

    Also, I believe the BeagleBoard [wikipedia.org] is the SoC OMAP3530 [wikipedia.org] ... not to mention there's a bunch of Samsung products (since it was mentioned that they are "rising competition") that depend on the OMAP4xxx [wikipedia.org] series like the Galaxy S II and Galaxy Tab 2 and Galaxy Nexus ... lot of BlackBerry devices on that list too. It's not just the Kindle Fire using OMAP4, there's a lot of current devices using OMAP3 & OMAP4.

    What's going to happen to all these devices when Amazon decides it doesn't make open source hobby boards or cell phones and condenses these SoCs down to just Kindle-related focus? I guess it'd be stupid to throw away all that business but anybody know what would happen to these?

    • by tecmec (870283)
      ...and the Pandaboard, which is the only device that joe-shmoe can buy off the shelf, download the Android Open-Source Project code, and start developing on instantly. I'm very afraid of how Amazon might ruin the OMAP for the rest of us if they buy it.
    • Samsung, B&N, Blackberry etc will have no problem switching to another provider, probably Qualcomm. ARM chips from TI are fine, but they are definitely not the only provider, and switching from one to another is mainly a matter of changing drivers. It's not a big deal.

      The hobbyists might have more trouble though, although the BeagleBoard is sold under the CC license, and in any case you could switch to arduino possibly, so they won't be completely lost.
      • by tibit (1762298)

        BeagleBoard isn't even remotely in the same league as Arduino-style products. BeagleBoard is like a PC. Arduino processor boards are like what you might have in a graphing calculator if you're lucky :)

      • The interesting thing is that Amazon will most likely steer the TI chips towards designs ideally suited for the ereader market. B&N might be most successful buying Amazon chips, if they have the option. Perhaps they ought to focus on differentiating on software, product, and service now.

        Amazon probably benefits more from a massive, vibrant ereader market than they would trying to own an entire smaller, more stagnant one, so I bet they do continue to sell to B&N.

    • by Svartalf (2997)

      Quite simply, there's enough range of stuff (including the Embedded Sitara based BeagleBone...hint...hint...) that you can lay hands on for that price range right now from alternate suppliers of A8/A9 based SoC's.

      It's annoying, but you should be thinking in terms of being able to jump ship to something else on a moment's notice- they're in it for the money and they can drop anything anytime they feel like it. Even if TI doesn't sell this stuff...they could still end up pulling the plug on it all. It's jus

      • If TI is making a profit off of them, I can't see Amazon not being to make the same or more profit. And if Amazon can make a profit, I don't foresee them dropping the product.

    • by Svartalf (2997) on Monday October 15, 2012 @11:38AM (#41658563) Homepage

      It should also be noted that if they sell the division, TI or it's successor in interest is OBLIGATED to fufill any obligations for supply lifetime on parts- period. For TI to have gotten the business in the first place, they'd have to guarantee it. It's how that part of the industry works.

      I can assure you that the vendors of these devices will have 5-10 year windows on parts that WILL be honored or Amazon and TI would be on the receiving (read: LOSING) end of a nasty breach of agreement lawsuit.

    • Amazon taking charge of OMAP could leave rivals Barnes & Noble in a tricky situation

      Also, I believe the BeagleBoard [wikipedia.org] is the SoC OMAP3530 [wikipedia.org] ... not to mention there's a bunch of Samsung products (since it was mentioned that they are "rising competition") that depend on the OMAP4xxx [wikipedia.org] series like the Galaxy S II and Galaxy Tab 2 and Galaxy Nexus ... lot of BlackBerry devices on that list too. It's not just the Kindle Fire using OMAP4, there's a lot of current devices using OMAP3 & OMAP4. What's going to happen to all these devices when Amazon decides it doesn't make open source hobby boards or cell phones and condenses these SoCs down to just Kindle-related focus? I guess it'd be stupid to throw away all that business but anybody know what would happen to these?

      Amazon seems to be in the business of selling "stuff". Chips are stuff, I don't think they will likely stop selling the chips before they are obsolete. So to reiterate, they'll probably keep selling the chips at least until January 2013.

    • What's going to happen to all these devices when Amazon decides it doesn't make open source hobby boards or cell phones and condenses these SoCs down to just Kindle-related focus? I guess it'd be stupid to throw away all that business but anybody know what would happen to these?

      Amazon NEVER throws away business. Hell, they were a book store that started selling computer time. Also, where do you think most people buy those hobby boards? I found a bunch of them on Amazon... If anything Amazon will make the stuff MORE available, since anything made from those parts will probably end up being sold by them.

    • by prpplague (17497)

      just FYI, the BeagleBoard uses an OMAP derivative, not an actual OMAP. The DM335x series is based on the OMAP but is not considered an OMAP.
      the PandaBoard however is based on the OMAP44xx series....

  • What? (Score:4, Interesting)

    by Alwin Henseler (640539) on Monday October 15, 2012 @11:12AM (#41658143) Homepage

    Call me ignorant, but since when is Amazon a company that develops hardware?

    I know Amazon has a big catalog, but customized / re-branded products aside, aren't they basically a box-moving company? What the *** are they doing in the chip development business? More specifically: what do they expect to do, that a specialist like TI can't do for them?

    • by Jeng (926980)

      Patents, lots and lots of patents.

      • by gl4ss (559668)

        Patents, lots and lots of patents.

        I think you nailed it.

        TI's chip business isn't that hot acquisition otherwise.

        if it were, TI would hold on to it.

        (problems include not being able to ship on date in ~10 years or having the promised performance - bad combo that lead to many manufacturers feeling burnt.)

        • by Jeng (926980)

          problems include not being able to ship on date in ~10 years or having the promised performance

          I did a few weeks of temp work for TI once. I'm not sure why they pulled us from shipping, but we were looking over circuit boards I believe for routers or something. Some of the chips were on upside down, as in shiny side up, and these has already passed two QC's. That is not what they were having us look for, but it is what I found. They no longer had a need for my services soon after.

    • Re: (Score:3, Informative)

      by taktoa (1995544)
    • Re:What? (Score:5, Informative)

      by SpzToid (869795) on Monday October 15, 2012 @11:26AM (#41658355)

      Have you heard about the Amazon Kindle? About the only thing you can compare it to in terms of actual units sold is the iPad, so Amazon is in Apple's league. Yes, seriously, Amazon is huge in 'readers' which is a variant of tablets, I suppose as I don't have much experience with them myself.

      Just as Google developed the Chrome web browser so as to have direct influence over the presentation of the web, Amazon has created hardware readers to have direct influence over how electronic versions of its content are consumed.

      Neither wants to be at the mercy of some vendor, (and I'm thinking about you Adobe and your Macromedia Flash).

    • The BN nook uses this processor. Sounds like an attempt at freezing out the competition.
      • by Svartalf (2997)

        That entirely depends on the commitments to supply TI made to B&N. Those don't always die off when divisions change hands- and they go to the successor in interest when they do. So...it'd be Amazon having to supply their competitor with parts. Seriously.

    • Call me ignorant, but since when is Amazon a company that develops hardware?

      I know Amazon has a big catalog, but customized / re-branded products aside, aren't they basically a box-moving company? What the *** are they doing in the chip development business? More specifically: what do they expect to do, that a specialist like TI can't do for them?

      The last time I heard something like this was when a book store started selling computer time. Amazon is VERY good at finding new markets.

    • by BBF_BBF (812493)

      Call me ignorant, but since when is Amazon a company that develops hardware?

      I know Amazon has a big catalog, but customized / re-branded products aside, aren't they basically a box-moving company? What the *** are they doing in the chip development business? More specifically: what do they expect to do, that a specialist like TI can't do for them?

      Umm... Amazon runs one of the largest commercial "cloud" computing services, they've moved from being a strictly "box mover" a LONG time ago. Buying TI's OMAP division may help Amazon develop custom low power servers that would improve their "cloud" in addition to moving their e-reader/multimedia consumption device design in-house.

    • Call me ignorant, but since when is Amazon a company that develops hardware?

      You've got it. Amazon don't develop hardware like this, which is why to get in on they act they need to buy an established player. Whether this is a good idea or not is open for debate (looks okay short term, but I'm highly skeptical beyond that), as it would bring Amazon something very different that is out of their wheelhouse. As a company that does services and supply very well, is it really necessary to go so far with the Kindle? The e-reader business is a money maker of a delivery system for them but t

  • Misleading Title (Score:5, Informative)

    by Anonymous Coward on Monday October 15, 2012 @11:13AM (#41658157)

    OMAP is only one small part of TI's integrated circuit business.
     
    That said, I'd really prefer if they kept it. I really like what TI has been doing with OMAP lately. I'm afraid Amazon might ruin it for the rest of us.

    • by AdamHaun (43173)

      OMAP is only one small part of TI's integrated circuit business.

      Yes. Editors, please fix this. TI's "chip business" is 98% of the company (the rest is calculators).

  • With Amazon's tablet being so much more tightly controlled than most Android devices, it should be much easier for Amazon to change architectures, and just force in-house and other developers to ensure their apps (if native, rather than the 90%+ that are Dalvik) are recompiled and working on the new CPU from day one.

    As we saw with the first $100 ICS tablet out of China, MIPS chips can be cheaper while still performing just as well, particularly with China spending good amounts of money to keep developing th

    • Maybe they think that they can make it cheaper after acquiring it?

      • Probably. But when competitors continue to advance, will Amazon be able to keep up? Seems like putting a lot of eggs in one rather expensive basket.
  • Amazon taking charge of OMAP could leave rivals Barnes & Noble in a tricky situation.

    Apple just announced that it's going into the chip business. Why not Microsoft too?

    The new Barnes & Noble subsidiary, which will build on the history of innovation in digital reading technologies from both companies, has not been named and will be referred to as Newco.
    http://www.eweek.com/c/a/IT-Management/Microsoft-Invests-300M-in-Barnes-and-Noble-Settles-Patent-Flap-555788/ [eweek.com]

    • by BLToday (1777712)

      MSFT can buy AMD with their pocket change, then they can own the full stack (chips, graphics, server (SeaMicro), OS, and applications). Of course, Intel would be pissed. But it's not like Intel would stop supporting Windows. Mac OS X is not going to be able to make up the difference in lost Windows sales.

      Intel needs MSFT more than MSFT needs Intel.

  • I doubt that this will be good for other TI users, either---not just B&N.

  • by Nimey (114278) on Monday October 15, 2012 @11:33AM (#41658483) Homepage Journal

    Are they selling Kindles or books?

    Right now they seem to be laboring under the delusion that they're a Kindle company. They've deliberately crippled the Android version of the Kindle software; for instance, you can't categorize books into collections, which is a Big Deal if you're a serious reader and have dozens or hundreds of books. There's no technical reason for the omission, it's just market segmentation.

    I can't imagine they (currently) make more profit on the Kindle than they do selling their books, music, et al, so I can't see a rational reason for this strategy.

    • whereas books arn't (if you're under 25). And if you live in the fantasyland that a lot of these dot.com CEOs do and believe that skinny jeaned hipsters with disposable cash will be your core market in the future (they won't , they'll have moved on to the next must have male handbag substitute long before) then you'll go for the flash products every time at the expense of your the business that actually makes you money now.

    • They sell Kindles to sell you books.

      If they sell you a physical book one time, there's nothing to say you'll buy from them next time. If you're the kind of person who reads a lot, this decision can happen 10-30 times a year. Sure you might be loyal and enjoy Amazon's prompt delivery service, but you also might be in an airport or walking by a display in your neighborhood.

      If they sell you a kindle you've made that ereader/tablet purchase once and will probably not do it so for a while. In between, they've

    • by 0123456 (636235)

      Amazon is a search engine for stuff. You go there to search for stuff you want to buy and they arrange for you to buy it and take a percentage. They don't much care whether you buy a paperback or a laptop or a snow blower, or whether you buy direct from them or through a third party who sells through them. They just want a cut of all the money you spend on stuff.

      Thinking of them as a traditional retailer is a mistake. They're not.

    • Bezos has already said recently that they make no profits on Kindle (at least the e-ink one), it's literally sold at cost. So they're a books (or rather content and services) company, and they know it full well.

      However, Amazon's strategy recently has been to flood the market with cheap devices that undercut others on cost, and then preferentially support/advertise their services on those devices. Hence their constant drive to make their hardware cheaper. I expect this acquisition is a part of that strategy.

      • Right. They make money on content and services, and have an incredible distribution network. That's why I say that although buying out a part of TI's business that TI isn't sure what to do with may not be a great idea. Sure, it could help them cut costs on current or near-term generation products, but what about further down the line? What happens in a few years when the nascent tablet market looks very different? Will they be able to adapt in a cost-effective manner or will they fail when the Kindle line
        • Well, in other markets they have employed the same tactics as well, and have successfully driven prices down. Look a bit closer at what Amazon is involved in, you might get surprised. They even have a local grocery delivery service nowadays in some areas (which actually doubles for delivery of purchases that come directly from Amazon warehouses in those areas).

  • Bigger question is - will they maintain a separate fork from the 2.2/2.3 they are using?

    Or will they move to Jelly Bean (without the pieces they don't like obviously), and continue to maintain their own stuff separately?

    This may make things more interesting.

  • by robot256 (1635039) on Monday October 15, 2012 @12:05PM (#41658951)

    No one seems to have mentioned it yet, but it's worth pointing out that Amazon is presumably buying just the OMAP processor *design* unit, not the manufacturing unit. They will likely still use TI's foundries to make the parts, but Amazon will have control over the architecture and who gets the documentation.

    Also worth reinforcing that this is not a bad deal for TI. ARM CPUs are pretty much a commodity product at this point, without much room for differentiation unless you go hog wild with optimizations like Qualcomm has. TI's main business has always been in the low-level ASIC and microcontroller markets, where is has a very large, well-respected variety of parts and continues to improve them.

    • by gl4ss (559668)

      and who gets the documentation.

      That might be just it! the _only_ way to get good specs on it is to buy the whole shitbang!

    • by daviee (137644)

      Maybe good for TI, but not sure about other companies/products that depend on the OMAP. Amazon after all has not yet demonstrated they are a good R&D/chipset company. It's also (not yet) one of their core businesses. Unless you're developing a one-off product with not too much plans for future evolution, would you develop it based on a chipset that has an unknown future? Will Kindle requirements become the main driving force of future OMAP updates?

      Amazon has the money to take a snapshot of the OMAP

  • I know Amazon says they don't make any money on the hardware, which probably sucks for them, but a Kindle fire goes for about $ 150 US so there really isn't that much to be made on each sale, even if production costs go down 30% you are only making 45$ per unit. Now if you control the manufacturing, edge out competition like B&N's nook you could release a Kindle 2 at 300$ and still be far cheaper than an IPad and make a good chunk off hardware costs.

    Good for Amazon shareholders? Sure would be! Good f
  • by wbr1 (2538558)
    The way the line wrapped on my phone, I thought the headline read, "Amazon considering buying Texas.". Maybe I need a kindle so I can have longerlines on my screen.
  • by Big_Breaker (190457) on Monday October 15, 2012 @12:36PM (#41659447)

    I really wish someone would come out with a dual core arm SoC with e-sata and gigabit ethernet as a light duty server. 1BG of ram would be nice but 512MB would probably work too. Guruplug, some of the allwinner media boxes and BYO drives NAS boxes come close but each miss something or cost too much. Single core is weak for rar / par and can get bogged down (yea, yea scheduler, blah blah). USB can't set HD parameters, has material cpu overhead and is wonky for RAID. 100/10 is a bit weak throughput for even a SOHO server.

    OMAP5 with the right configuration would get there. Please stop putting 100/10 interfaces on these chips @&#$%!

    I'm ok paying for a light-duty gpu and hdmi display interface but e-sata and gigabit pls, pls ,pls.

    • by Svartalf (2997)

      Marvell's done that [marvell.com]...with up to quad cores even. Dell partnered up with them to make their first ARM server in their lineup.

  • Considering how gimped the Kindle series is (it excludes the entirety of the Google ecosystem), adding more horsepower would be akin to putting lipstick on a pig. As such, I have no idea what Amazon hopes to accomplish with this acquisition, and don't expect much from it.
  • I think it won't happen as the article describes.

    TI "spin off" the OMAP and make the Sitara and the DaVinci families ("almost" same features as OMAP) that are used by several "non-mobile" applications. Many people depend on those and I am sure that they need to keep producing and developing for many more years.

    Also, OMAP is a SoC that has TI proprietary devices used by other markets, like for example the DSP, and I am sure they are not selling those either.

    I think the best deal for Amazon would be to make a

  • I thought oh, Amazon is buying Texas. That should help with the sales tax issue :-)

  • by rot26 (240034)
    Just out of curiosity who still uses woot since Amazon bought them? Show of hands? Anybody? Class? Anybody?

    Yeah thought so.
  • Anyone here remember when TI was *the* powerhouse of chip development/fabrication? Anyone remember when the *only* name in radio was Motorola.. ( no, RCA doesnt count )

    Now look at what we have, moto is owned by a damned search engine, and soon TI by a book company...

    WTF is going on in this world?

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