• By
  • Don Clark

Intel’s stock price, and image, have suffered from the fact that its chips are not widely used in smartphones and tablet PCs. But it turns out that the Silicon Valley giant had an inside track when it came to Apple’s iconic iPad, lost after Steve Jobs faced an impassioned plea from a top lieutenant.

The episode is one of many anecdotes in Walter Isaacson’s biography of Apple’s late CEO. He writes that Jobs pushed for the use of Intel chips when Apple was developing its tablet computer, betting on the same technology that powered his company’s Macintosh desktop and laptop computers.

Intel CEO Paul Otellini, left, former Intel CEO Andy Grove, center, and Apple CEO Steve Jobs look at the new MacBook Pro laptop computer at the Macworld Conference and Expo in San Francisco in this Jan. 10, 2006, file photo.

Intel at the time was developing its low-powered Atom chip, which Jobs favored, Isaacson writes. Intel CEO Paul Otellini was pushing hard to work with Apple on the tablet, and Jobs was inclined to trust him.

But Tony Fadell–then a key leader of Apple’s design efforts, now at the startup Nest Labs–was adamant that the iPad needed the even lower power consumption of chips based on designs from ARM Holdings. He felt so strongly about the matter that, during one meeting, he placed his Apple badge on the table and threatened to resign over the matter, according to the biography.

Jobs eventually relented. Indeed, Apple became such a zealot for ARM that it began designing its own chips based on the technology, using an engineering team acquired by buying the startup P.A. Semi.

The biography also includes some sharp criticism by Jobs of Intel, at least beyond its high-performance microprocessors for PCs. Intel, Jobs said, had wanted to do a “big joint project” with Apple to do chips for future iPhones but was not selected.

“There were two reasons we didn’t go with them,” Jobs said, according to the book. “One was that they are just really slow. They are like a steamship, not very flexible. We’re used to going pretty fast. Second is that we just didn’t want to teach them everything, which they could go and sell to our competitors.”

Isaacson includes Otellini’s rebuttal to this account. The real issue, Intel’s CEO told him, is that Apple and Intel couldn’t agree on chip pricing. The companies also disagreed on who would control the design–another example, the author concludes, of Jobs’s compulsion to control every aspect of a product.

Elsewhere in the biography, Isaacson recounts how Jobs and Otellini had gotten to know each other in the 1990s when Jobs was struggling to sustain his second company, NeXT, and “his arrogance had been temporarily tempered,” as Otellini put it. Later, at Apple, Jobs pushed for the pivotal move in 2005 to start using Intel chips for the Macintosh, after years using the PowerPC technology promoted by IBM and Motorola.

Chip pricing in those days was also a key issue, with Jobs wanting better terms than other computer makers, the biography discloses. Jobs and Otellini would take walks together above the Stanford University campus, starting with broad pronouncements by Jobs about the evolution of computing. By the end of the walk, Jobs would be haggling over price, Isaacson writes.