Apple's 64-bit A7 chip takes aim at Wintel corporate profits

Today in Apple: The real strategy behind Apple's 64-bit A7 chip. Plus: Android fingerprint sensors? And Qualcomm's CEO takes a slap at Apple's A7 chip

By , ITworld |  Mobile & Wireless, Android, Apple

Apple's 64-bit A7 Chip and Wintel Corporate Profits
Seeking Alpha has a very interesting article on the the real strategy behind Apple's 64-bit A7 chip. It's aimed at getting Apple a large chunk of the corporate profits that have been enjoyed by Microsoft and Intel over the last 30 years.

The most significant part of Apple's (AAPL) launch of the iPhone 5S and 5C were not the phones themselves, rather it is the 64 bit A7 processor, which will be the platform that moves the company safely to higher ground while the rest of mobiles commoditizes. While analysts preened for a mass market $300 phone to "save" the ecosystem, Apple headed in a completely different direction that offers revenue growth and increased margins. Contrary to belief, $300 phones are a dead end.

Tim Cook has not mentioned it publicly but his number one goal is to take over the corporate Wintel business that has driven profits for Microsoft (MSFT) and Intel over these past 30 years. With every new O/S and processor, the duo have been able to knock on corporate IT doors and create pull based on the strong new technical aspects of their respective products. A natural pull for high end PCs and professional Windows O/S with security was put in place as "no one ever got fired for buying IBM (IBM)" (Wintel).

Apple’s decision to launch the 64 bit A7 in the iPhone 5S and expected soon in the iPad 5 will set the stage for software app developers to focus most of their attention on not just porting apps but creating interoperability with OS X at the expense of Android.

In many ways what Cook has already put in place with the yearly product introductions is a treadmill that freezes the competitors during the high consumer holiday selling season that lasts through Chinese New Year. Layered on top of this, he seeks to build in a corporate selling treadmill that favors Apple’s mobile and iOS introduction schedules, thus building a wide moat around the top half of the market that drives profits.

More at Seeking Alpha

This is a very different take indeed on Apple's A7 processor. The corporate Wintel business could be absolutely huge for Apple. And it puts the lie to some analysts and technology journalists who claim that Apple's move to 64-bit is nothing more than a marketing gimmick (see the last story about Qualcomm's CEO below).

It seems to me that Tim Cook is following Steve Jobs' sage advice and skating to where the puck will be, while Apple's rivals flail around trying to grab low end market share. Apple knows that there's big money in the corporate sphere, and they are positioning themselves to get quite a lot of it.

Android and FIDO Biometric Sensors
Speaking of eating Apple's dust, it seems that Android makers are scrambling desperately to come up with fingerprint sensors for their devices.

Michael Barrett cringes every time he has to enter a password on his smartphone.

But six months from now Barrett says he will be able to choose from the latest Android models that will come equipped with a biometric sensor capable of letting him swipe his fingerprint to access a wide range of his online accounts.

That's the scenario being proactively pursued by the FIDO Alliance, a group of 48 tech companies, led by PayPal and Lenovo, hustling to implement a milestone technical standard.

"The intention of FIDO is absolutely that it will allow consumers to have access to mobile services that they can use with very low friction, while keeping good security," says Barrett, president of the FIDO Alliance. "That's explicitly what we want to build."

Apple's latest iPhone model features a much-ballyhooed fingerprint sensor, called Touch ID, that can be used to lock and unlock the phone, as well as authenticate the user to purchase digital media on iTunes. Touch ID, for the moment, is not FIDO-compliant. Apple spokeswoman Natalie Kerris declined comment.

More at USA Today

The FIDO initiative is interesting, but I doubt Apple will pay much attention to it. Why would they? They already have touch ID in the iPhone 5S, and it remains to be seen if FIDO will ever actually amount to anything. Sometimes what sounds good on paper never makes into real products.

It doesn't surprise me to see this sort of scramble for Android devices to emulate Apple's success with touch ID. As I noted in the first section, Steve Jobs always wanted to skate to where the puck was going to be, not where it had already been.

Apple is way out in front on biometrics and the Android device makers have been caught with their pants down. We'll see if they are able to scramble fast enough to catch up to Apple in any meaningful way.

Qualcomm CEO Bashes 64-bit Apple Chip
As I noted above, some people just don't understand the importance of Apple moving its iOS devices to 64-bit. Qualcomm's CEO is calling Apple's 64-bit A7 chip a "marketing gimmick."

Apple's 64-bit A7 processor in the iPhone 5s is more a marketing stunt than a technical enhancement and though it will not deliver any immediate benefits to smartphone users, there are other reasons to move to 64-bit, a Qualcomm executive said on Tuesday.

"I know there's a lot of noise because Apple did [64-bit] on their A7," said Anand Chandrasekher, senior vice president and chief marketing officer at Qualcomm, in an interview. "I think they are doing a marketing gimmick. There's zero benefit a consumer gets from that."

A benefit of 64-bit is more memory addressability, but that is not relevant in today's smartphones or tablets, Chandrasekher said. The iPhone 5s has only 1GB of DRAM.

"Predominantly... you need it for memory addressability beyond 4GB. That's it. You don't really need it for performance, and the kinds of applications that 64-bit get used in mostly are large, server-class applications," said Chandrasekher, who previously ran Intel's mobile platforms group.

"We've been investing quite a bit into both Windows Phone and Windows RT. We're one of Microsoft's partners," Chandrasekher said. "We're optimistic in the way we invest in the marketplace, we're cautious of the outlook in terms of what the revenues might look like."

More at Tech World

You sort of expect Qualcomm to say something like this, given that they supply chips for Windows and Android devices (note his comment about Windows Phone and Windows RT). But it also shows how far behind Apple they really are in terms of their thinking.

Apple is aiming very high indeed with their 64-bit mobile chip, and Qualcomm and other companies just don't seem to get it.

What's your take on this? Tell me in the comments below.

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