Apple Continues To Buy Chips From Freescale

Although Apple announced the big switch to Intel processor, the Cupertino company decided to secure its provision of Power PC microprocessor.

Apple and Freescale, the company responsible for the G4 chip that powers Apple's laptops and Mac mini desktop computers, entered into a purchase agreement Aug. 22 whereby Freescale is obligated to supply Apple with Power PC microprocessors through 2008.

In the filing, Apple said it is "under no obligation to purchase Freescale microprocessors other than work in progress that was in place at the time the agreement was executed."

Apple spokesman Steve Dowling declined to comment on why Apple signed the new purchase agreement with Freescale.

"We will continue to meet Apple's needs throughout the transition process," said Freescale spokesman Glaston Ford.

The analysts are speculating that Apple's decision to secure an agreement with Freescale may be an indication of a longer-than-expected transition to Intel processors. Last year, Apple accounted for 3% of Freescale's $5.7 billion in total sales.