Apple plans transition away from Intel chips in its products

Apple will transition from using Intel chips to processors designed in-house, in a major shift that chief executive Tim Cook called an “historic day for the Mac” computer.

Speaking at the company’s annual Worldwide Developers Conference on Monday, Mr Cook said the transition away from Intel would take about two years, with the first products using “Apple Silicon” expected by the end of the year. Intel’s shares rose 1 per cent in response to the timeline for the change.

“Integrating hardware and software is fundamental to everything we do,” Mr Cook said. “That’s what makes our products so great, and silicon is at the heart of our hardware.”

Apple already builds its own processors for the iPhone and iPad, using designs from SoftBank-owned Arm Holdings. The computing speed of these “A-series” processors improved more than 100 times over 10 generations, “keeping the iPhone’s performance ahead of every phone in the industry”, said Jonny Srouji, Apple’s senior vice-president for hardware, who spoke at WWDC for the first time since joining the company in 2008 to lead development of its “system on a chip”.

Shares in Apple hit at a record-high of $359 after the event late on Monday, rising 2.5 per cent to value the company at more than $1.55tn.

The move to Arm designs, which has been predicted multiple times over the past decade, has been widely flagged in recent weeks. It is meant to improve computer speeds and give third-party developers a more streamlined way to create applications that work across Apple’s portfolio of products. 

“Embracing Arm and making hardware more consistent across the iPhone, iPad and Mac ranges is a strategic necessity,” said Ben Wood, chief of research at CCS Insight. He said Apple’s motivations were “reducing its dependence on Intel, maximising its silicon investment, boosting performance and giving itself more flexibility and agility when it comes to future products”.

Apple’s annual Worldwide Developers Conference is usually held in-person, presented live and often interrupted by cheering. This year, due to the coronavirus pandemic, it was pre-recorded and tightly edited in a cinematic style.

The Apple Watch has received several upgrades — including ways to help users better wash their hands © Bloomberg

Many of the updates announced on Monday had been widely expected, including new software updates meant to improve user experience tracking fitness and sleep and navigating through cities with Apple Maps. But consumers looking for new hardware were disappointed. 

Apple did not, as hoped, offer a redesign of the desktop iMac, whose last overhaul came in 2012, nor did it introduce “Apple Tags”, a widely-anticipated “lost items” tracking tool whose development has caused rival Tile to complain that the tech giant was abusing its power.

Still, the transition from Intel to in-house silicon is a major development, and will be welcomed by app makers as Apple comes under fire from disgruntled developers unhappy with restrictions led by the 30 per cent “Apple Tax” on subscriptions purchased through the App Store.

Big Sur is the latest version of Apple’s desktop operating system © Reuters

Other big announcements on Monday included the launch of Big Sur, the latest version of Apple’s desktop operating system. It includes a redesign of the Dock, the ability to have widgets on the home screen, and better organisation for multiple apps.

For its smartphones, Apple introduced iOS 14 and redesigned how apps are organised on the home screen. It launched a new tool called App Library that clusters similar apps together, as well as a widget feature inspired by the functionality of the Apple Watch.

A new feature called “App Clip” will let consumers temporarily use apps without having to download them and clutter the screen. For instance an iPhone user can hail a scooter, pay for parking or use a coupon at a new coffee shop.

Some social media users, however, critiqued the updates, saying that Apple was playing catch-up to a host of features already available on Google’s rival Android platform.

Where Apple is aiming to differentiate itself is a focus on privacy, with iPhone users soon able to see a “nutrition label” that displays how an app tracks a user’s movements and uses this data. An Apple executive said with the new requirement, “you can [see] if the developers are collecting a little bit of data on you, or a lot of data”.

Mr Wood said: “I think some people are going to be shocked to see how much tracking there is in certain apps as a result of the new App Tracking capabilities.”