Chip maker Portal Player saw it"s shares almost halve in value last night. The brutal price drop was caused by Apple"s announcement that they would not be using their chips for future versions of the iPod.
Currently, Portal Player makes 90% of its revenue from Apple and the iPod; its "all in one" chips provide the technology that makes the iPod work. The company had expected that Apple would pick it"s chips for the next generation of iPods. Apple did not say who they would be using instead, or speculate on what the change meant for future versions of the iPod. One can only speculate that Apple found it hard to get video working well with Portal Player.
Portal Player expects its chips to continue to be used in Apple"s low-end products; he said specifically that that the chip would no longer be used in the mid (30Gb) high (60Gb) and flash (Nano) products.
Portal Player"s chief executive, however, maintained a brave face. "
We have a number of design teams in place with a number of exciting products under development." Looks like his days are
numbered.