There has been much talk during the week about Pure’s new UK-only music streaming service which is said to rival and undercut Spotify. What hasn’t been mentioned, as far as I can see, is that Apple holds a significant stake in this new product. Pure is a brand of Imagination Technologies (IMG), a current darling of the London stock market. And Apple owns 9.5% of Imagination.
If I subscribed to conspiracy theories, I might wonder whether this new development is something of a trojan horse to allow Apple to have a part in the new and lucrative music-streaming world. It is almost certainly not. But nevertheless it is significant that Apple has a major sharholding¹ in a Spotify competitor.
IMG is a British-based maker of mobile graphics and microprocessor chip technology. The company’s products are used in Apple’s iOS devices. Apple also has a big stake in another British company of note, ARM. The low-consumption ARM technology has been a cornerstone of iPhone and iPad development.
What isn’t generally know, though, is that Apple once had a 43% stake in ARM but sold it to raise money during the late nineties. This Cult of Mac story explains:
Given how forward thinking Apple is, it probably wouldn’t surprise you to hear that the Mac maker once bought a 43% stake in ARM back in the early 1990s. What probably would surprise, you, though, is that Apple sold that stake at a loss… and that sale saved the company from total bankruptcy.
As a keen watcher of Imagination² (IMG) and ARM (ARM), I have noticed the way in which the stock prices of both British companies move more or less in sympathy with Apple (AAPL). This year there have been rumours that Apple could acquire ARM. But it would not make sense. As with IMG, ARM licenses technology to most major players in the industry. Ownership by one manufacturer, such as Apple, could actually harm prospects. I suspect both Intel and Apple are investors in ARM and IMG in order to monitor developments and to prevent a takeover that could harm their interests.
¹ Apple has a 9.5% stake in Imagination Technologies. Intel has an even bigger share, just over 16%.
² Disclosure: MacFilos holds stock in Apple, ARM and Information Technologies.