New MacBook Will Throw Out Intel Over Tim Cook's Risky Gamble

according to reports in Bloomberg and elsewhere. It is an ambitious move and perfectly in fitting with Apple’s ‘own it all’ attitude. The question is what impact will an Intel-less Mac family will have on Apple, on Intel, and on the macOS ecosystem?

Apple CEO Tim Cook (R) previews a MacBook Pro during a product launch event at Apple headquarters in Cupertino, California (Photo: Josh Edelson/AFP/Getty Images)

Apple’s primary focus in recent years has always been about the iPhone and to a certain extent the iPad - i.e. the future is going to be driven by iOS devices. These work with the cloud and while the cloud services do interface with the Mac, the desk-bound machines have been taking on secondary/support roles behind the mobile product.

Look inside the current Mac machines and you can see Apple already taking control of the secondary chips such as the touch input focused T1 chip in the MacBook Pro and the iMac Pro’s power and security focused T2 chip. The iPhone and iPad portfolios already use the Axx system on chips, so why not commit to even more self-designed chips for the Mac machines?

This is a natural evolution of Apple’s controlling nature, and I suspect the attraction of the value that controlling more of the product offers. The money paid out to Intel for the chips and technology inside the mac machines can now stay inside Cupertino, boosting the revenue per sale. Even if Mac and MacBook sales drop, Apple will still have similar revenue potential (at the expense of losing market share).

Macbook, March 2015 (image: Apple PR)

Although it might seem a huge loss to Intel, Apple’s orders cover around five percent of its annual revenue - a loss which has seen shares drop by nine percent after the news was announced:

Barclays’ data (via Mercury Research) says 19 million Macs were sold last year across a wide range of price points. Lining up with yesterday’s Bloomberg article, Barclays estimates that Apple’s high-end machines account for 3-4% of Intel revenue, while the budget models are said to account for about another 2% of Intel’s sales.

Intel derives far more revenue from enterprise equipment and servers. That’s a market that is not going away, and of course Apple’s switchover in 2020 is still far enough away that Intel could move to an even more favourable mix of servers and Windows 10 powered devices by the time Cupertino makes the change.

What would be a loss would be the prestige that Apple offers. There is value for Intel in being able to say that it powers the Mac range, but there’s even more prestige for Apple if it can say that it has designed everything inside the desk-bound computers.

This is probably the death-knell for MacOS as we know it. Apple is already working on emulation to allow iOS apps to run under macOS. Expect that integration to continue, potentially through some new co-processors on the high-end Mac machines announced this year. As that momentum builds, the digital switchover to have older MacOS apps running in emulation mode on the ‘new native’ hardware will (so the theory goes) allow for a smooth change.

Of course by the time the new chips are available in sufficient numbers to flood the Mac line-up, how invested will Apple be to push the macOS powered machines when the future is clearly iOS and ‘Pro’ iPhones and iPads?

Apple is preparing to switch away from Intel’s chips in its Mac and MacBook portfolios, and move to an in-house designed chips according to reports in Bloomberg and elsewhere. It is an ambitious move and perfectly in fitting with Apple’s ‘own it all’ attitude. The question is what impact will an Intel-less Mac family will have on Apple, on Intel, and on the macOS ecosystem?

Apple CEO Tim Cook (R) previews a MacBook Pro during a product launch event at Apple headquarters in Cupertino, California (Photo: Josh Edelson/AFP/Getty Images)

Macbook, March 2015 (image: Apple PR)

Although it might seem a huge loss to Intel, Apple’s orders cover around five percent of its annual revenue - a loss which has seen shares drop by nine percent after the news was announced:

Barclays’ data (via Mercury Research) says 19 million Macs were sold last year across a wide range of price points. Lining up with yesterday’s Bloomberg article, Barclays estimates that Apple’s high-end machines account for 3-4% of Intel revenue, while the budget models are said to account for about another 2% of Intel’s sales.

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