Apple's Latest Purchase Is iWatch Related
NEW YORK (TheStreet) -- Apple
Technology reporter Jessica Lessin reports that Apple has acquired the Silicon Valley-based Passif. What separates Passif from other semiconductor manufacturers is that Passif's chips use little power. Mobile deivces, particularly smartphones and tablets have increasingly become important for computing needs, as more people turn to these devices to surf the web, work, take pictures, stream videos and other functions. The problem however, is that these devices have had battery life issues, but Passif Semiconductor's chipsets use very little power. Apple is constantly seeking ways to extend battery life for the iPhone and iPad, but a purchase of Passif could be for the oft-rumored iWatch.
Passif's technology incorporates a radio that works with a low-energy version of Bluetooth, which is good for health and fitness devices. The iWatch is such a device which would play perfectly into that category. Apple is reportedly working on a smartwatch, as are other technology giants including Samsung, Google
With Passif under its control, Apple, which makes its own chips utilizing intellectual property from ARM Holdings
Apple could not be immediately reached for comment for how much it paid for Passif, though Lessin reported that Apple had previously tried to purchase the company a few years ago, "for a price in the mid-tens-of-millions of dollars."
Smartwatches, and in particular the iWatch, have smaller screens, and need longer battery lives, which is where Passif and its chipsets comes into play. By launching a smartwatch, Apple could generate significant revenue for the company, coming in a time when revenue growth is not as robust as it once was. Morgan Stanley analyst Katy Huberty has recently said that an iWatch, priced at $200, could generate as much as $10 billion to $15 billion for Apple per year. Apple is projected to generate $171.4 billion in fiscal 2013, and $187 billion in fiscal 2014, per Thomson Reuters.