Why the Intel-Apple Split is a Disaster for Intel

We’ve known for years that Apple’s ARM-based chips are becoming so powerful they can outperform Intel on the desktop. In 2018, Apple made a point to say their new iPad Pro is faster than 92% of all laptops sold in the last year.

The benchmarks showed this to be true – some tasks were performed by the iOS tablet in half the time it took a Dell XPS 13 Core i7. Moreover, the iPad also has superior battery life.

It is not just the amazing processors Apple makes by taking ARM reference designs and optimizing them, it is the tight software integration which has allowed them to dramatically outperform Android devices.

Discussing Apple Silicon at WWDC2020

A $400 iPhone SE 2 outperforms all Android phones – regardless of price.

We have the greatest respect for analyst Rob Enderle – he explains all the reasons losing Apple is a win for Intel. Apple is a tough negotiator, they likely caused Intel to lose money and were generally difficult to deal with and worst case, they work against their suppliers.

While this a great analysis, it assumes a static PC market where Apple hovers around 10% market share or under.

The PC market will not stay static if Apple is able to put out a $400 device that vastly outperforms all the PC competitors costing far more. Won’t most every enterprise and consumer look to switch in order to save money?

Even at the same price, many will consider switching to Macs if the performance or battery life is vastly superior.

Generally, the wealthiest customers – in many western countries at least, have Apple iPhones and iPads.

What keeps them from purchasing a Mac is their familiarity with Windows. This will continue to be less of a hurdle as iOS familiarity helps them transition more quickly to Mac.

Hundreds of millions of PC users who have iPhones are annoyed they can’t see their iPhone messages on their PCs the way a Mac user can. They are upset they cannot use Facetime or Siri on their PC.

In addition, the differences between the platforms continue to erode as a result of cloud apps that work on any browser. The browser continues to become the OS.

Apple announced Safari on macOS Big Sur is twice as fast as Chrome. This is an important metric if you are looking to lure users from other platforms. In addition, Apple just quietly acquired Fleetsmith, a multi-device deployment and management firm. If you are looking to support more enterprise deployments, this is a great way to do it.

Then there are the apps – people love their iPhone applications and would be thrilled to run them on their desktop and mobile computers. There are 1.8 million apps that have been tested to be virus and malware-free.

We believe if Apple does focus more on expanding its Mac business to take on PCs and Intel doesn’t do something radical in terms of performance increases; more importantly, performance per watt, Apple will take serious share. We anticipate going from 10% to 25% within 5-8 years.

Oh, and to make things even easier for Apple, when people start going back to malls in big numbers, they will only have Apple stores to choose from as Microsoft will be closing all its retail locations.

Intel of course knew this day would come and is obviously doing whatever it can to win the performance game. But they are more constrained than ever as Apple’s ability to sell incredibly performing chips at bargain prices is unmatched. This means the new metric to focus on is performance/watt/dollar.

In summary, a PC user – assuming they have an iPhone or iPad already, and switches to Mac gets the following:

  • Better performance/dollar (If the past is any history it will continue to outpace Intel)
  • Access to Facetime
  • Access to Messages
  • Access to Siri
  • Access to a physical store they can take their device to
  • Almost 2 million applications
  • Seamless sharing across devices
  • No more compatibility issues between PC and iOS
  • Integration of native iOS apps into their everyday desktop experience
  • Apple News
  • Better cybersecurity

Perhaps the one thing PC users will miss is touchscreen laptops but Apple will likely overcome this hurdle in a future release.

Intel and AMD management know what is happening and they are likely going to wow us with their future solutions. They have not faced competition like Apple before and they better redouble their efforts to stay competitive.


 

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