Multi Level Cell

Apple buys Anobit for half a billion dollars

December 20, 2011: 6:40 AM ET

Cupertino's largest acquisition since it bought Steve Jobs' NeXT in 1997

According to Reuters, Apple (AAPL) has sealed the deal that was rumored last week to buy Anobit, the Israeli company that makes the flash memory technology used in Apple's iPhones, iPads and MacBook Airs.

For Apple, this is a big acquisition, both in dollar terms and in technology. The price -- a reported $500 million -- is larger than the $472 million it paid for NeXT, once 14 years of inflation is taken into account.

The acquisition also reinforces Apple's growing commitment to flash memory, which is gradually replacing the hard drives the company has been using for mass storage since the mid 1980s. Apple is now the world's largest consumer of flash, thanks to sales of its iPods, iPads and iPhones.

The MacBook Air also relies on solid state (rather than mechanical disk) memory, and flash is now an option on the company's MacBook Pros as well.

The advantage of flash over disk storage is that it's faster and generates less heat. The disadvantage is that it's significantly more expensive.

That's where Anobit comes in. As GigaOm's Erica Ogg explained last week:

"Anobit makes flash memory devices that can use the popular Multi Level Cell (MLC) flash-based solid-state drives. Consumer devices use MLC flash because it's cheaper, but it's also generally less reliable than the more common Single Level Cell flash drives. Anobit's technology makes MLC more reliable."

Apple is also reported to be planning to build an research center in Israel, its first outside the U.S.

News of the acquisition was first reported in the Israeli paper Calcalist. You can read the English translation here.

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