A leading analyst say the downside of Apple's insistence on using leading-edge chip technology are risks inherent in using a sole supplier.
Schwab Soundview Capital Markets analyst John Jones told Reuters: "Only a handful of companies, IBM and Intel among them, are making chips with 90-nanometer technology. There's no place else for Apple to go to have that chip made."
IBM produces the PowerPC G5 chips that are expected to figure in the new iMac, availability of which has been postponed until September. Apple previously experienced delays with G5 chips that resulted in limited availability of Power Mac G5 shortly after launch.
Apple has admitted it will run out of the current generation of iMacs at least a month before it is able to launch the new models. Analysts at IDC have calculated that one month of lost iMac production will amount to 32,000 units, or about $32 million in sales. This translates to a bottom-line hit of about $260,000, after production costs, taxes and other costs. The calculations are based on 2003 figures.
IDC analyst Roger Kay said: "We looked at that figure and said it's not that big a deal. We think that kind of math is what led the company to delay the new iMac launch.
"From Apple's point of view it's not really an IBM story, it's a 90-nanometer story, and it just has to be patient."