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Apple boosts in-house chip program with $600 million acquisition


Dialog has worked with Apple since the original iPhone. Apple has signed a licensing deal with its long-time supplier Dialog and acquired assets including 300 employees, the two companies announced. Apple will pay the UK-based firm $300 million now plus another $300 million in the future for delivery of products. It also awarded Dialog a number of new contracts for power management, charging and audio subsystem chips. In June this year, Nikkei and other sites reported that Apple was working on its own power management chips in an attempt to centralize manufacturing and reduce costs. That would have come at the expense of Dialog, which has been making chips for Apple since the original iPhone. It relies on Apple for about three quarters of its revenue, and recently warned investors that Apple had slashed orders by around 30 percent. The acquisition of 300 people, or 16 percent of Dialog's workforce, is Apple's largest ever in terms of personnel, Techcrunch noted. The teams are based in Italy, England, Germany and elsewhere in Europe. Apple will reportedly be co-locating with Dialog and may take over entire buildings in some cases. "Dialog has deep expertise in chip development, and we are thrilled to have this talented group of engineers who've long supported our products now working directly for Apple," said Apple hardware SVP Johny Srouji. Apple is supposedly most interested in the power management circuits developed by Dialog. The aim is to reduce power draw on devices like the Watch and AirPod Wireless headphones. Following the acquisition, Dialog said it will focus its non-Apple business on Internet of Things (IoT), automotive and storage tech.

Apple bets $600 million on improving Apple Watch, iPhone battery life


Apple's relationship with Dialog goes back many years, to the early iPhone days. Apple struck a huge deal that will push its chip-making ambitions forward. The tech giant agreed to pay $600 million in total to Dialog Semiconductor, a UK-based chipmaker that has been working with Apple since the first iPhones came out. That large amount of money will go toward two things: $300 million in cash pays for a portion of Dialog's company, including licensing power-management technologies, assets, and more than 300 employees who will now work for Apple. The company will pay the remaining $300 million to Dialog in advance for products to come out within the next three years. "Dialog has deep expertise in chip development, and we are thrilled to have this talented group of engineers whove long supported our products now working directly for Apple," Johny Srouji, Apples senior vice president of Hardware Technologies, said in a statement. Our relationship with Dialog goes all the way back to the early iPhones, and we look forward to continuing this long-standing relationship with them. The 300 Dialog engineers who will now be Apple employees have reportedly already been working closely with the company. Those folks will continue to work out of offices across Europe as Apple takes over some Dialog facilities in Italy, Germany, and the UK. Apple's acquisition of Dialog points to the company's seriousness in making its own chips, particularly for power management. Apple already makes chips found in its iPhones and iPads, but taking on more of the manufacturing process could help the company cut costs. Also, more efficient power-management chips could improve Apple devices like AirPods and the Apple Watch. While battery life is a big concern for all Apple devices, it's more pronounced in accessories like the wireless earbuds and the Watch, both of which are designed to work either all day or for multiple days at a time. With Dialog's technology and IP, Apple will likely be able to develop a better power-management chip than it could have on its own. After the acquisition, the remainder of Dialog's company will focus on the IoT, automotive, and computing and storage markets. The deal is expected to be finalized in early 2019, pending regulatory approval.