First, let's look at Mr. Papermaster's (that name doesn't get old, does it?) background.
In the late 90's Papermaster was one of the main drivers of the PowerPC chip. He likely had lots of interaction with Apple at this point as they were the IBM PowerPC's biggest customer. The PowerPC 630 (or Power3) was ultimately used in IBM mainframe computers.
He has authored many papers on chip design and is generally regarded as one of the leaders in the chip design field.
Then a few years ago, he was put in charge of IBM's blade server division. I think this point is moot because I don't think Apple is going after the blade server market. I'd frankly be surprised if they put any more resources into their Xserves. Apple, the consumer company, just doesn't spend much in the way on resources on servers.
Plus the terms of the suit laid out above seem directly in line with chip design. Apple isn't competing with IBM in the blade field. But they are likely going to be competing with IBM in the chip field fairly soon.
So, let's focus on the PowerPC portion of Papermaster's resume. He is one of the leaders in chip design field.
PA Semi, the company Apple purchased a few months ago, was going up against IBM in selling PowerPCs (PA Semi's PWREfficient was in the running to replace the IBM G5 when Apple moved to Intel). PA Semi, as a unit of Apple, is still fulfilling PowerPC contracts for embedded systems for military and other uses.
But will the final product that Apple is working on be a PowerPC processor? Probably not. One of PA Semi's engineers let slip a few months ago that he is working on an ARM based processor that will be in future Apple products.
So what will become of this hire? My feeling is that he will add a lot of talent to the PA Semi team and his mentoring will help bring in other talented chip engineers to Apple, unless IBM blocks him.
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