Will Apple's new products really abandon Intel?

I believe everyone has seen Apple’s two previous fall press conferences. After the iPad Air, Apple Watch 6, and iPhone 12 series, Apple also held its third fall press conference. The press conference was still held online, officially releasing new Mac products equipped with self-developed M1 chips and three new M1  products  .

 Mac products based on Apple Silicon  have actually been in Apple's plans for a long time. They were formally proposed at this year's WWDC20 conference. You must know that Apple's self-developed chips have brought generation after generation of successful products, including successive iPhones, iPads, and Apple Watches. If nothing unexpected happens, the M1 will also become a successful generation of self-developed chips.

"Software and hardware integration" product strategy

Apple has always adhered to the product strategy of "integration of hardware and software", so it has almost stringent standards for controlling its own supply chain, and self-developed core hardware is also a must. Apple's involvement in chip research and development can be traced back to the Steve Jobs era (1990s).

In order to resist Wintel (Windows & Intel) monopolizing the computer market, Jobs joined forces with IBM and Motorola to fight against Microsoft and Intel. Apple was not a dominant player at the time, so even if it joined forces with IBM and other companies to develop chips, it ended in failure. However, this opened a new chapter for Apple to develop its own chips.

In order to build a closed-loop ecosystem of "software and hardware integration", Apple has put a lot of effort into the core component of chips. However, developing its own chips is a thankless task and takes time. Why does Apple still want to develop its own chips?

From the simplest perspective: Apple’s chip suppliers are not very powerful, and Apple has an extraordinary obsession with staying ahead, so this is really something that only Apple can do on its own. It’s better to torture itself than to torture others and still not be able to make what it wants.

On the other hand, there were a lot of discussions about Apple Silicon at the beginning of the release, but more of the comments were asking: What does the release of Apple's self-developed chips mean? Replacing Intel chips with self-developed chips means that Apple will have more control over its own laptops and desktops, and the  Mac  experience will be more coordinated with the iPhone and iPad, because all Apple applications use ARM architecture, and iPhone applications will be compatible with Mac; for ordinary users, the Mac series products will be much cheaper than before.

 Intel's manufacturing capabilities lag behind

Apple proudly said on Tuesday that the M1 chip in its new Mac uses 5-nanometer transistors.

"5-nanometer technology is leading the way, and only a few products use it today," said Jon Erensen, an analyst at Gartner. Intel currently sells products using 10-nanometer transistors.

Generally speaking, the more transistors a chip maker can pack into the same space, the more efficient the chip will be. Intel currently only makes chips with 10-nanometer transistors.

Intel controls its own chip factories around the world, while Apple outsources its own chip designs to Asian companies. But Apple's chip manufacturing partner TSMC can produce 5-nanometer chips, while Intel cannot.

"Intel has faced some challenges in the manufacturing space over the last few years. And I think those challenges have opened up a window or opportunity for ARM-based designs to enter the market. Apple is one of the best ARM processor designers out there," said Gartner analyst Jon Erensen.

Intel CEO Bob Swan said earlier this year that the company was considering outsourcing manufacturing like Apple.

"As Intel faces challenges in upgrading to 10nm and 7nm, and as foundries like TSMC and Samsung step up their efforts to promote these technologies, Intel has lost a major advantage and has leveled the playing field to some extent," Ellenson said.

Better performance and battery life

Apple says the M1 Mac is superior to older models, largely because it claims its self-developed chips have better performance and longer battery life than Intel chips.

The new Macs will obviously have longer battery life. Apple's previous chips have been used in smartphones and tablets, which use much smaller batteries than laptops.

At its event on Tuesday, Apple emphasized that it will evaluate chips based on performance per watt rather than raw performance.

Apple says that with the entry-level MacBook Air, you can get 15 hours of web browsing on a single charge, nearly 30 percent longer than the previous 10 to 11 hours with Intel chips.

Apple says the new Macs also work more like phones or tablets, with the ability to wake instantly from sleep, and they can even run iPhone apps if developers take steps to make them compatible with the App Store.

But analysts warned that testing of the products after they go on sale next week would be needed to confirm Apple's performance claims.

“The performance of the new M1 chip is virtually impossible to assess because the company has not provided any detailed evidence for its performance claims,” said Patrick Moorhead, founder of Moor Insights.

Apple on Tuesday did not remove laptops powered by Intel chips from its shelves, and its high-end products still use Intel processors, indicating that some Intel chips still have a performance advantage.