Imagination, Apple’s (AAPL) Mobile GPU Partner, Buys Ray Tracing Company

Imagination Technologies is a small British based company that makes the PowerVR silicon for Apple’s (NASDAQ:AAPLiPhone, iPad and the iPod Touch. Their GPUs also show up in many other flavours of hardware. Between ARM and Imagination a good chunk of the mobile Systems on a Chip (SOCs) in todays devices are sourced.

Apple (AAPL) holds a small share in the company, which it recently increased from 3% to almost 10%. And Imagination (like ARM) is currently a healthy performer on the UK stock market, unsurprisingly.

It is being reported that Imagination has purchased a company called Caustic Graphics who are well known for their Ray Tracing technology that can produce super high fidelity images in 3D. The difference between normal raster based graphics that we see on current GPUs, and Ray Traced images that we normally see in technology demos, is in some ways akin to the difference between normal TV and HD TV. And not surprisingly the horsepower needed to produce the higher quality images is not inconsequential.

$27 million, the purchase price for Caustic, is not an insignificant sum to a company like Imagination. They do not posses the cash reserves of a company like Apple. But on the back of a growing stock value, and increased sales revenue and market share this strategic purchase is something that Imagination obviously see as important.

The PowerVR line of GPUs coming in the next 12 – 18 months promise that mobile GPUs will be delivering desktop quality graphics within 2011 on handheld devices. So it seems likely that in the not too distant future Imagination and Caustic Graphics see an opportunity for Ray Tracing on devices in our hands.

One of Imagination’s strategies to producing high speed, high quality graphics is a “Tile Based” rendering system that allows significant rendering performance improvements on their mobile PowerVR chip sets. Perhaps between the two companies they can come up with a similar approach to traditionally horsepower heavy Ray Tracing that will similarly impress.

It is expected that this technology will show up in Apple’s devices in the future.

Ray tracing is a key additional technology that traditionally has been regarded as the exclusive domain of specialised markets and non real-time applications, said Hossein Yassaie, chief executive of Imagination. “We intend to change that.”

Yassaie said the acquisition for $27 million will allow Imagination to create even more advanced graphics technology in the future.

Excited to think of Ray Traced graphics on your iPad or iPhone? Have your say in the comments…

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Stephen NorthcottImagination, Apple’s (AAPL) Mobile GPU Partner, Buys Ray Tracing Company