Apple CEO Steve Jobs (search) is expected to announce Monday morning at the company's software developers conference in San Francisco that Apple will discontinue using microprocessor chips made by IBM in favor of Intel (INTC) chips, according to CNET Networks Inc.'s News.com and The Wall Street Journal.
Officials from Apple, Intel Corp. and International Business Machines Corp. could not be reached Sunday to confirm the report.
For years, rumors of Apple's wish to jump to Intel have been circulating. But two weeks ago, analysts were skeptical when The Wall Street Journal reported that Intel and Apple were in negotiations.
One reason for the skepticism is that the move represents a significant risk for Cupertino, Calif.-based Apple.
Switching to Intel's x86 chips (search) would force Apple's programmers to rewrite its software in order to adapt to the new processor.
"I don't know that Apple's market share can survive another architecture shift," Insight 64 analyst Nathan Brookwood told News.com. "Every time they do this, they lose more customers."
News.com reported that Apple would begin the transition to Intel with its lower-end computers, such as the Mac Mini (search), in mid-2006 and higher-end models a year later.
Apple's break with IBM stemmed from Jobs' wish that IBM make a larger variety of the PowerPC (search) processors used in Macintosh systems. IBM balked because of concerns over the profitability of a low-volume business, News.com reported.
By wrestling away Apple's business from IBM, Intel tightens its stranglehold on the PC processor business. The company holds more than an 80 percent share of the market.
Although IBM suffers a setback with the loss of Apple, the company could reap a financial windfall from deals with Microsoft (MSFT), Nintendo and Sony Corp. (SNE) to put microprocessors it is producing in next-generation video-game consoles.
A new microprocessor that IBM co-developed with Sony and Toshiba Corp, code-named Cell and planned for Sony's next PlayStation (search) console, is being touted as capable of delivering 10 times the performance of today's PC processors.