How Apple achieved these gains is an interesting business and technical story. In 2008, about a year after Apple released the first iPhone, it purchased a small semiconductor start-up to build specialized chips for its phones. For many years, Intel’s chips were made primarily for stationary machines like servers and personal computers. To hit their top speeds, Intel’s processors had to draw a lot of electricity and created a lot of heat. But Apple’s most important products are mobile, powered by batteries, so chugging a lot of power wasn’t ideal. Its chip designers had to take a starkly different approach. Rather than maximize raw power, Apple aimed to build chips that were optimized for power and efficiency.
The technical ways Apple has achieved this combination will sound like geeky gobbledygook to anyone unschooled in semiconductor theory. Broadly, though, Apple’s systems use a lot of specialized processing units and are optimized to run more operations “out of order,” a technical term that basically means they can execute more code simultaneously.
The result is something like the difference between a muscle car and a Tesla. The muscle car achieves high speeds with a huge engine that burns a lot of gasoline. The Tesla can hit even higher speeds while consuming less power because its electric motor is inherently more efficient than a gas engine. For years, Intel was making muscle cars; Apple’s big innovation was to build the Tesla of computer chips.
Apple also benefited from enormous economies of scale. Because the iPhone is one of the most profitable products ever sold, the company could afford to invest billions in a custom chip operation — and then to repurpose its iPhone chips for the iPad, the Apple TV and now the Mac.
Apple’s investments have helped spark a new race in the chip business. Intel is investing $20 billion on new chip-making plants, and other chip manufacturers — Samsung and TSMC, which manufactures processors for Apple — are collectively investing hundreds of billions of dollars to increase capacity.
If I sound a little too giddy about microchips, it’s because there hasn’t been much breakthrough technical innovation in the tech business for years. Facebook is off ruining democracies, Google just keeps sucking more money out of ads and each new iPhone is just incrementally better than the last.
Apple’s processors feel genuinely new. For better and worse, they will dramatically improve the capabilities of our devices in the next few years. Today’s fastest phones are more powerful than computers from just a few years ago; Andrei Frumusanu, who covered Apple’s new processors for the tech-news site Anandtech, told me that he expects Apple will be able to keep pushing similar gains at least through the next decade.