Apple Chips

Link at SeekingAlpha. The article is all about investing but I was more interested in what the writer had to say about Apple and chips. It is all very, very interesting.

The most objective way to analyze a chip's power and performance is through benchmarking. In this form, Apple's chip beats everything else on the market by a significant margin, even though specs-wise it appears to be less powerful.

The more one looks into the iPhone 5s' development, the clearer it becomes that it has absolutely no need for Intel's more expensive chips in the foreseeable future. This becomes even more evident when one analyzes how Apple achieved this.

1. Apple started with licensed architecture from ARM - Intel does not license its architecture.

2. Apple designed its chip in-house, then outsourced the manufacturing to Samsung, most likely for minuscule margins. This kind of foundry business is not an appealing business for Intel - but even if it was, Apple has shown that it does not need the latest foundry tech (Intel's biggest strength) to create the most advanced mobile chip.

3. Apple's new chip is 64-bit. This poses another danger to Intel, as it most likely marks the rest of the industry's move to 64-bit for mobile. With this, mobile chips based on ARM's architecture will increasingly encroach on Intel's business.

4. Perhaps most importantly, Apple was only able to do this by integrating vertically. I mentioned earlier that at first glance, Apple's chip does not seem very powerful. However, because Apple designs its chips along with its software, it is able to optimize them more effectively than all of its competitors. This likely marks a trend in which leaders will imitate this model (if they can). Samsung already manufactures its own chips, and will most likely be working hard to produce something that competes with the A7, not just through hardware, but by optimizing the hardware to their own software.

The Apple story is simply amazing. Again, Apple is positioning itself to be as self-sufficient as possible.