I look at the impact of mobile technology and online media
While the iPhone 6S and 6S Plus may look like iterative updates to consumers, the hardware inside the two handsets illustrate Apple’s continuing desire to extract more profit from its smartphone line-up. With Intel working hard to offer an alternative to Qualcomm’s LTE modem, Tim Cook has another competitive front that can lower costs and increase the margins on his flagship handsets.
Tim Cook in the shadows at WWDC 2015
Earlier this month the discrepancy between Apple’s A9 chip suppliers came to the fore, with the news that the ultimate performance of the Samsung-fabricated A9 drew more power than the TSMC-fabricated A9. Apple’s response was that the testing required ‘maximum demand’ be placed on the chips over a consistent period, and that a more realistic power curve kept the two strains of iPhone 6S models within a tolerance of two or three percent.
What is more interesting about this model is that Apple has engineered its latest smartphone to work with two different suppliers of the same key component. At a hardware integration level that’s a mighty fine piece of work, and it ‘s even more impressive when you look at it through a capitalist filter. Apple has created another competitive market inside the iPhone 6S family with apparently very little friction between the use of either component. Moore’s Law will see the price of the A9 chip fall over time, but with two competitors fighting over space on the circuit board Apple can easily accelerate that process.
Tim Cook’s team has mastered squeezing as much profit as possible out of the iPhone. The substantial engineering cost to allow two different types of CPU chip to be used will have been a notable investment, but the corporate knowledge gained will be reflected in all of Apple’s products going forward over the next few years. This will easily be a net positive assuming some hardball negotiations across the life of the iPhone 6S and subsequent devices.
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Which makes the news that Intel is working hard to provide the LTE modem chip for the (presumptively titled) iPhone 7 all the more interesting.
Next: how Intel can weaken Qualcomm and help increase Apple’s margin…
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