It makes perfect sense. This way Apple will guarantee the quality of their products. Developing good hardware is as big of a challenge as developing good software if not bigger.

It's a tactic that Hewlett-Packard tried in the 1970s and 1980s. A reason that their chip-making was eventually scaled back is that even though the chips were custom and very good quality, eventually generic chips became so much cheaper, it was more cost effective to use two or three of them to duplicate the custom chip's function.

With Apple, there's probably not the option to take up all that space? Or perhaps they have some very tricky things up their sleeves they don't wish to advertise whatsoever.

These days memory is cheaper than ever. I do not see why every device provides their own software. No more install DVDs. Just plug your device and it will automatically set itself or install the drivers on the host system. IPhone is the perfect example that there is a combination of software hardware to have a successful product in the stores. Anyway developing hardware is fun and I do not see how software can be without hardware. Hardware is poised to evolve.

Seeing as though they have an affinity for filing patents, perhaps what they want to do is design their own chips, then farm the production out to other companies who might be able to mass produce the chips at a lower cost than Apple.

They could then keep the technologies to themselves, or license them out, or even allow these 2nd party companies to sell the actual chips on the open market and make royalties on those sales.

well.... if GrandCentral in 10.6 is as integrated as it can be, allowing for much of the main CPU work to be moved from the CPU, then I guess tactics like this might play even more-so into such a strategy. Interesting move though, here's to GrandCentral being at least as properly implemented as CUDA.

Great their own chips that only decode shit dled from itunes.