Online retailer Amazon is considering an acquisition of Texas Instruments, a maker of mobile processors used in a variety of tablets and smartphones. The rumor arrives just as Texas Instruments confirmed it’s been struggling to upend its main rivals Nvidia and Qualcomm for orders.

According to Reuters, citing a report by Israeli financial newspaper Calcalist (which last December broke news of Apple’s acquisition of Anobit), Amazon is “in advanced talks” to buy Texas Instruments for an undisclosed sum…

Per Reuters:

The report said any deal for the smartphone chip business of Texas Instruments Inc (TI) would probably be worth billions of dollars and could make Amazon a direct rival to Apple Inc and Samsung Electronics Co Ltd, which also design their own chips.

Texas Instruments’ OMAP 4470 processor powers the Kindle Fire HD tablet that Amazon unveiled last month. That chip is said to be 40 percent smaller than Nvidia’s Tegra 3 silicon that powers Google’s Nexus 7 tablet.

Amazon also made a mapping-related acquisition and is reportedly considering strengthening its platform presence by releasing its own smartphone.

Nasdaq reported today that an Amazon smartphone is due next year.

“By acquiring a chipmaker, Amazon would be able to play a greater role in the devices it produces”, the report notes. “The company already manufactures four versions of the Kindle Fire tablet, as well as multiple versions of the Kindle e-reader”.

Texas Instruments also makes components for Apple products, including a touchscreen system-on-a-chip module (labeled the 27AZ5R1) inside the new iPod touch and the 27C245I touchscreen controller inside the iPhone 5.

The news gathering organization cited analysts who expressed concern over Amazon’s ability to invest billions on development of mobile chips.

AppleInsider recently reported that Apple is thought to be actively courting Texas Instruments engineers to help advance iOS processors.

With the A6 chip, Apple’s completely customized silicon that Samsung only manufactures on a foundry basis, the iPhone 5 beat both Samsung and Texas Instruments in delivering the world’s first phone powered by ARM’s Cortex A15 CPU platform, despite Texas Instruments previously announcing a forthcoming ARM implementation for the OMAP5 application processor.

It is true that Texas Instruments is scoring design wins alongside Qualcomm and Nvidia for tablets, but Samsung and Apple – the two biggest tablet makers –  aren’t buying any chips from Texas Instruments.

Texas Instruments recently said it will focus on specialized industries amid strong competition in the mobile space. The company warned it would only honor existing contracts and would not invest in supporting its customers’ future plans for tablets and smartphones.

Waht do you think, does Amazon have the expertise, the technology and talent to compete with the likes of Apple and Samsung on the chip design front?

  • Careful with those headlines – they aren’t looking to buy Texas Instruments but rather just their chip making arm. Second misleading headline in the last week. Love the blog but hate to click in and find the true story hiding four paragraphs down.

    • armund

      Zibreg quite frequently talks out of his ass, and very likely doesn’t even know what a behemoth Texas Instruments (TXN) is.
      So, no wonder he titled the article wrongly.