The first Apple computers with the Intel chips onboard could appear by mid-2006, technology site CNet reported over the weekend.

The move would mark a big change in Apple strategy, and a boost to Intel at the expense of IBM.

Industry watchers are expecting an announcement by Apple on the deal on Monday at a company conference.

Chipping in

If the rumours about the switch prove correct, the move will end a decade-long relationship between Apple and IBM.

When IBM began making chips for Macs in 1994 that deal ended a single-source relationship Apple had with Motorola.

Even now Motorola subsidiary Freescale produces chips, known as PowerPC processors, for Apple's notebooks and the Mac Mini. IBM produces PowerPC chips for Apple's G5 machines.

The Mac Mini could be the first Apple machines to move to Intel chips with the more powerful machines following in 2007.

In its story, CNet said that by 2007 almost all Apple computers could be running Intel chips.

Apple's move to Intel is thought to have come about because of IBM's reluctance to expand the number and range of PowerPC chips it makes.

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IBM has the contract to PowerPC chips for Microsoft's imminent Xbox 360 console, Sony's forthcoming PlayStation 3 game machine and Nintendo's future game-playing machine.

As a result the cash it gets from making chips for Apple has become a very small slice of its revenue.

Because of the sheer volume of chips that Intel makes the move could mean that Apple computers become significantly cheaper.

Technology transfer

But the move is not without its obstacles.

This will be easier for the latest version of the operating system, known as OS X, as it is based on software that already runs in Intel chips.

Technology news site The Register also reports that Apple has licensed technology from a company called Transitive which makes software that makes it easier to port programs on to different chip architectures.

But Gary Barnett, research director at analysts Ovum questioned the wisdom of the deal if it goes ahead as rumoured.

Mr Barnett said the move away from IBM would be "extremely foolish" not least because Intel has been out-innovated by both AMD and IBM.

He declared himself surprised because the PowerPC line is about to start being made in huge volumes thanks to the deals with Sony, Microsoft and Nintendo and IBM's efforts to get other device makers to adopt it.

Our advice to Apple is this - If Intel has offered you such a good deal¿, then by all means adopt a dual architecture strategy," he said. "But to defect from one processor architecture just as it seems about to take off to one that may have already peaked doesn't make any sense to us at all."

Apple's WorldWide Developers Conference opens on 6 June and in his keynote speech Apple boss Steve Jobs is expected to make the announcement about the tie-up with Intel.