
Apple inks $600M deal to acquire assets and talent from Dialog Semiconductor - tooltalk
https://techcrunch.com/2018/10/10/apple-is-paying-300m-in-cash-to-buy-a-part-of-dialog-semiconductor-and-expand-its-chipmaking-in-europe/
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snops
Apple taking the application processor business in house has gone very well,
they currently have a substantial tech lead in the smart watch market due to
their processor advantage over the outdated qualcomm most android devices are
stuck with [1]. They have a similar (but smaller) advantage in phones, though
that is also due to a very large die size as they can afford to spend more per
product.

Presumably they are looking at moving power management silicon in house as
well to consolidate that advantage. At there scale, they will be getting
custom silicon from Dialog already, but there's probably some comms/cost
benefits to dealing with a department rather than an external company.

[https://arstechnica.com/gadgets/2018/09/review-googles-
wear-...](https://arstechnica.com/gadgets/2018/09/review-googles-wear-
os-2-0-cant-fix-its-obsolete-smartwatch-hardware/)

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basch
It sounds a bit like the GT Advanced situation.

Apple starts a relationship with a company, the deal becomes the VAST MAJORITY
of the company's revenue, the company wants to get out of the buisness of
being an apple supplier, because IF they scale to that size and lose a
contract, they have huge cuts to make. So apple comes in, buys a substantial
part of the company, and now the company can continue to operate without fear
of downsizing. Any downsizing will be apples doing not theirs.

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hinkley
When you get most of your money from one or two sources you aren’t really in
control anymore. I can totally appreciate not wanting to be beholden to
anyone.

The last consulting firm I worked for had over 70% of their revenue coming
from two contracts, and neither contract used any of the tools or philosophies
the consulting company claimed to espouse.

Ended up being the case that all the reasons I wanted to work there were just
marketing messages and my sense of betrayal soured the relationship.

That the guy in charge of developers left about a year after we parted ways...
every time I think about those people I wonder if he knew it was all bullshit
or if he just got tired of dealing with attitude from stressed out developers
and never understood why they were pushing back.

~~~
kbenson
> The last consulting firm I worked for had over 70% of their revenue coming
> from two contracts, and neither contract used any of the tools or
> philosophies the consulting company claimed to espouse.

Assuming you're talking about philosophies that are considered good practice
because they lead to more sustainable design practices and smoother
development later, I have doubts those _ever_ survive in long-term consulting
contracts. The way pressure flows in those scenarios always leads towards
emphasizing speed of development. Anything else requires multiple points in
the management path both in the local firm and client firm to be willing to
forego short term cost for potential long term gains, and if any one of them
is out of alignment it causes problems.

~~~
hinkley
But why wouldn't you pick a cut-rate consulting firm in that case instead of
one that claimed to be doing deep work in a number of areas?

~~~
kbenson
The point is not that people don't _want_ to encourage behavior that pays off
in the end, it's that it takes alllinks in the chain to be vigilant about it
to happen. Anywhere in the line between the the client company's CEO to the
consultant company's developer if someone decides to cut corners because of
time, cost or some other unknown reason, that will flow down through each
subsequent level to the actual developers. There's probably five people in
that chain _minimum_ (including the developer, the client CEO, the consultancy
CEO, and any managing coordinators), and any one of them can easily change
this because of their own pressures. It's an inherently fragile system.

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slivym
Dialog used to sponsor a load of events in my department at uni, no one ever
bothered telling us what they actually did, so it was always a bit comical,
but now we know.

I think the fact they're only acquiring the relevant part of the company is a
fantastic move. It really shows apple is focused on what they're doing and not
just buying their way into markets like Cisco or Intel.

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samfisher83
The MI band which uses their chip gets great battery life.

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lawrenceyan
I assume this is also heavily influenced by the recent Qualcomm court case
where Apple was hit with infringing on one of their power management patents.

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superpie
This is pure speculation, but I wonder if this has anything to do with the
AirPower wireless charging mat's development?

~~~
nimish
Since the issue with wireless charging is power efficiency, having good power
engineers onboard will likely help. That said, they are almost certainly
buying them for the PMICs inside hardware devices first, and for accessories
like AirPower second.

But it's not a bad way to start shipping advanced power electronics like GaN,
which dialog has chips for.

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tooltalk
so I guess Apple didn't want to acquire the entire company and all its ~1,900
employees?

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ksec
For a company worth $1B before the announcement, Apple paid $300M for 16% of
their Staff and IP, and $300M for future order. For Dialog that is a much
better deal than selling all of itself when Apple has not use for the other
80%.

~~~
hinkley
Relevant snippet from their wiki page:

> Dialog Semiconductor is the exclusive designer of power management
> integrated circuits (PMICs) for the Apple iPhone, iPad, and Watch, which
> made up more than 70% of Dialog’s 2016 sales. Its share value halved from
> April to December 2017 after private bank Bankhaus Lampe changed its outlook
> for the company from “hold” to “sell” in the belief Apple would replace
> Dialog’s PMIC designs with its own...

Take the money, get rid of the sword over your head, and keep working on your
smart home tech with your new valuations and nobody yelling Frog and expecting
you to jump. There are worse ways to run a medium sized company.

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SlowRobotAhead
Glad I didn’t go with Dialog for a BLE chip. Kind of puts their line at risk
for future development.

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btashton
They are really great chips for power consumption and price. I have used them
in several products and the team behind them really knows what they are doing.

