As I’ve pointed out before, most of the differentiation in the iPhone is in the software and the industrial design. Almost none is in the hardware which, especially in the first version, was all off-the-shelf not particularly special standard parts.
So what’s all this chip design that Apple is doing? Apple purchased PA Semiconductor over a year ago. PA Semiconductor was building an ultra-low power version of the PowerPC architecture. Supposedly, however, they warned their customers that the buyout was unrelated to their products and just to their expertise. So I think we can assume Apple isn’t going to go back to using PowerPC in either Macs or iPhones (which have always been ARM based anyway). Their expertise is in building processors with high performance for extremely low power. Sounds like just the sort of thing you’d need in an iPhone.
In July, ARM announced that a leading OEM handset maker had taken out a multi-year ARM architecture license. This is widely believed to be Apple based on a lot of anecdotal evidence.
The CEO of PA Semiconductor was Dan Dobberpuhl (who also happened to be on my technology advisory board at Ambit so I know him somewhat). Prior to founding PA he was at SiByte (acquired by Broadcom) [corrected from earlier]. Prior to that he was one of the main architects of both StrongARM, ARM on steroids (which Intel renamed Xscale when they acquired Digital’s semiconductor business) and Alpha, the highest performance microprocessor for its power.
Don’t forget that Apple was one of the original investors in ARM when it was spun out of Acorn/Olivetti. The Newton was ARM based. Their dealings go back a long way.
There are also rumors of Apple producing a tablet computer, or an internet device or something generally between a laptop and an iPhone. It is interesting to speculate whether this would be like a Mac and powered by Intel (presumably Atom, but maybe not) or like an iPhone and powered by an ARM processor. They have some sort of event set up for October and all the rumor mills are working overtime.
So my guess is that Apple has decided that with the team of low power experts headed up by Dobberpuhl, and an ARM architecture license, that they can design a cell-phone with more processing power for the same battery life than the competition. They can then use that processor power with their software expertise to deliver a user-experience that will be very hard to equal for anyone else using a regular ARM to run Symbian, PalmOS or Android. Time will tell.