Apple's iPhone 4 is replete with sophisticated features

Apple is set to become the world's second largest semiconductor buyer in 2011, another sign of the shift in the balance of power in the chip world.

Driven by the success of the iPad and iPhone, Apple is expected to pass Samsung as the world's No. 2 chip buyer in 2011, second only to Sony VGP-BPS9/B Laptop Battery , according to market researcher iSuppli.

The firm is projecting that Apple's semiconductor spending in 2011 will hit $16.2 billion, surpassing Samsung Electronics, which is forecast to be at about $13.9 billion. HP will stay in the No. 1 position with $17.1 billion in spending, iSuppli said

"An advancement in the rankings means that a company has been successful in introducing new products," said Min-Sun Moon, senior analyst for semiconductor spend and design at iSuppli, in a statement. It also indicates that a company "is allocating more dollars in research and development--two factors that, incidentally, feed innovativeness as well," she wrote.


Apple's iPhone 4 is replete with sophisticated features.

That means lots of chips.

(Credit: Credit: James Martin/CNET) Apple's case also demonstrates a shift in the kind of chips that are being purchased. "The move to second place reflects the company's triumph in th VGP-BPS9 Laptop Battery and iPad, two flagship products that have captured the public's imagination--and have garnered tremendous sales--on a scale unequaled by rival devices," she wrote.

Both the iPhone and iPad use Apple-branded processors based on a design from ARM, whose chips are being used in small devices with PC-like functionality--like the iPad--as well as powerful high-end smartphones such as the iPhone 4 and Motorola Droid.

"This is a an indication of where the technology is moving," said Min-Sun Moon in a phone interview. "Apple is contributing to the trend of moving away from Microsoft-Intel to ARM-based systems," she said.

Other fast-growing chip purchasers include the Lenovo Group, SanDisk, and Research in Motion .

Dell battey Operating Officer Tim Cook said Tuesday that the iPad market is "very big" and speculated about sony vgp-bpl9 battery of PCs, while two market research firms upped their forecasts for tablet shipments in 2010.


As iPad continues to sell briskly, will it take a chunk out of PC sales?
During Apple's third-quarter earnings conference call Tuesday, Cook mused about the continuing strong sales of the iPad and its potential to eat into PC sales. The iPad "is not following typical early adopter curve and taking a long time to cross into the mainstream...We are absolutely selling every unit
This outlook varies somewhat with that of Intel, which supplies processors for the vast majority of PCs sold worldwide and sees tablets as merely additive. "I think this is an additive category of computing much like Netbooks were an additive category," Intel Chief Financial Officer Stacy Smith said last week during Intel's earnings conference call. Additive implies that there is little if any cannibalization of PCs.

Cook also explained how the iPad may have a positive effect on Mac sales. "Historically...iPod created a halo for the Mac and, in fact, as the iPod volumes took off you (saw) a dramatic change in Mac sales.

so, could that happen Sony VGP-BPS9A/B Laptop Battery Blackand iPad? We'll see," he said. "The Mac has outgrown the market 17 straight quarters. However, the Mac share is still low, so there is still an enormous opportunity for the Mac to grow. And certainly the more customers we can introduce to Apple through iPad, and through iPhone, and through iPod, you would think that there might be some synergy with the Mac there."

Meanwhile two market researchers on Tuesday revised their forecasts upward for tablets, of which the lion's share in 2010 is Apple's iPad. ABI Research said it "has revisited its forecasts, almost tripling the original estimate to reach about 11 million tablets expected to ship by the end of 2010...based both on the broader availability of the iPad."

iSuppli, another market research firm, was even more bullish. "Amid indications that Apple Inc. is ratcheting up its Sony VGP-BPS9/S production targets to meet booming demand, iSuppli Corp. is ratcheting up its shipment forecast as well. iSuppli now predicts Apple will ship 12.9 million iPads in 2010, an increase from the previous forecast issued April 2nd of 7.1 million units."

The only thing crimping iPad shipments is limited production capacity, iSuppli said. "iSuppli believes that the only limitation on iPad sales now is production--and not demand," said Rhoda Alexander, director of monitor research for iSuppli.