“While most analysts continue to focus on the battle between Apple (AAPL) and Samsung (OTC:SSNLF) in the smartphone and tablet market and much more interesting strategy is taking place with Apple’s ARM (ARMH) based processors,” Ed McKernan writes for Seeking Alpha. “The 64-bit A7 processor has elevated Apple into not just a premium consumer position but also as the leader in the corporate space that is about to turn into an adoption wave.”
“Intel (INTC), trying to protect its 64 bit PC Mobile positioning, purposely downplayed its 64 bit capabilities in the tablet and smartphone space in order to allow ultrabooks to get a head of steam. Apple gladly picked up the baton as the premier 64 bit architecture for mobile and thus imprinting the image of mobile processor leadership to not only its faithful followers but to the broader world market,” McKernan writes. “Superior branding will now ripple all the way through to the worldwide Fab Footprint games underway as noted by the Apple – Samsung connection with Global Foundries new Malta Fab in upstate New York. More importantly the pieces are in place to replicate the highly profitable Intel x86 model built in the 1990s.”
MacDailyNews Note: Ed McKernan is a semiconductor Veteran with 20+ years of experience at Intel and several prominent startups including Cyrix and Transmeta.
“With its 64 bit ARM roadmap about to expand, Apple has the luxury of building larger die that stretch the performance curve upward and in synchronicity with process technology improvements. Each increase in performance and capability will be effectively driving into the heart of Intel’s PC mobile processor roadmap that are sold at premium prices of $200 and more,” McKernan writes. “This profit can be absorbed by Apple if they are able to embed these ARM processors into mobile platforms that can replace PCs in most corporate environments. Logically the next platform to do this would be an iPad “Pro” with a larger screen and wedged in Apple’s lineup between the Mac Air and Mac Book Pro.”
“If Apple is able to receive a premium for its iPad Pro next year due to a more advanced A8 processor and thus effectively migrating not only the Intel ultrabook PC but also the $200+ Broadwell ULV processor residing inside it over to its side of the ledger, then we will have witnessed the beginnings of the transition to the premium ARM market under the tutelage of the one licensee who is more than just a fabless player,” McKernan writes. “With its increased profits, Apple then surely will fund the treadmill in mobile that will keep them in the pole position for years to come. In addition, coming soon is likely a 64 bit server design that will allow them to replicate the feat with an efficient processor designed to replace $2000-$6000 Intel Xeon processors that will run their iCloud. Google (GOOG) and Amazon (AMZN) are you listening?”
Read more – highly recommended – in the full article here.