Apple is getting ready to create its own graphics chips for upcoming iPhones and iPads, and the source of that news is particularly interesting seeing as it comes from the company that currently makes them, Imagination Technologies.

Imagination Technologies today announced that Apple is ending its contract with the company in “15 months to two years time,” seeing the end of a deal that has proven hugely fruitful for both companies.

Imagination’s PowerVR chip has been at the heart of Apple’s iPhones since day one, and while Apple soon replaced the Samsung ARM CPU with its own in-house part following a string of chip-making acquisitions, that graphics chip remained the purview of Imagination Technologies. That, according to the company itself, is now ending.

It seems that the news has come as a shock to Imagination, too, with the company saying that it will be taking the matter to the courts with Apple presumably wishing to cancel its deal ahead of its natural expiration. This could potentially spell doom for the company, and its shares fell a disturbing 60-70% on the back of the announcement.

The reason for Apple’s decision to create its own chips is unknown, but it does make plenty of sense. The PowerVR chip is now the last large piece of the iOS platform that is not under Apple’s control, and we all know how Apple feels about having control of its hardware. Apple also reused the same GPU in the iPhone 7 as the iPhone 6s, suggesting that there simply was no better chip made available by Imagination at the time Apple needed it. This may be the crux of the problem, and may also be a case of history repeating itself.

Mac fans will remember Apple ditching IBM’s PowerPC in favor of Intel’s Pentium architecture following IBM’s tardiness in creating ever more powerful chips whilst Intel was knocking it out of the park. Could a similar situation be happening here?

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