The Real Reasons Android Manufacturers Should Be Scared Of This Year’s iPhones

Apple Has Some New Challenges To Deal With

Since its launch in 2017, the iPhone has been the best-selling smartphone in the market. This year, Apple’s two new variants, the iPhone XS, XS Max and iPhone XR, were perhaps not quite so impressive, hardware improvement wise, as previous years.

Truth be told, however, Apple’s unit sales have stalled in previous years. (See chart.) The question for them now is how to keep the revenue line rising when, in large part, Western markets are saturated with their products.

When considered from this perspective, Apple’s 2018 device release schedule makes a lot more sense.

Apple’s Western markets are largely saturated with iPhones. The challenge for Apple now is maintaining revenue growth.
Apple’s challenge now is to maintain revenue growth when its Western markets are largely saturated with its phones.


Artificial Intelligence Is One Of The Key Features Apple Are Building Around

First, the subject which has gripped Silicon Valley as fundamentally as the arrival of the first CPUs, Artificial Intelligence. Apple’s iPhone XS and XS max both feature an upgraded A12 Bionic processor chip. Apple labels their new microprocessor as “The smartest, most powerful chip ever in a smartphone.”

The new component boasts a six-core CPU (Central Processing Unit), two cores dedicated to performance and four designed to improve efficiency.  Additionally, there’s a four-core GPU (Graphics Processing Unit), making it 50% more powerful than the equivalent in even the most recent previous models. The most interesting aspect of this processor, with its 7-nanometer architecture, is the upgrade Apple has made to their onboardneural engine – the component of iPhones made purely with Artificial Intelligence in mind.

The idea of artificial neural networks in iPhone is not new. Older iPhone models, including the iPhone X, iPhone 8 and iPhone 8 Plus, also had the neural engines. However, this year’s upgrades to processing power are substantial when considered simply from a ‘grunt’ point of view. While the Neural Engine A11 predecessor chip could deal with 600 billion operations per second, the latest can handle 5 trillion per second.

The Neural processor in this year’s devices includes an 8-core neural engine designed for all AI and Machine Learning (ML) tasks. This is the element of your iPhone which deals with the sort of math’s and algorithms that make AI functions – such as the analysis to verify if your Face ID matches what you have as your security image. Take a moment to consider the number of AI-related services that are already present on your phone. When you talk to Siri, that’s AI. When you see recommendations in the iTunes store, that’s AI. When pictures you take using your iPhone’s camera are automatically improved, and available for alteration after you’ve taken them, that’s AI at work.

Significantly, this year, Apple will open up their AI chip to their 3rd party developer community. For the first time, they will be able to use the chip to perform their AI related tasks, too. The result is likely to be a substantial increase in the apps available for Augmented Reality and AI-based personalized on-device software.

Esim And Dual Sim Capability Could Provide New Revenue Streams For Apple

An eSIM or ‘Embedded SIM’ is another hardware component which is built into your iPhone before you buy it. eSIMs do everything a standard, physical SIM does but they don’t take up nearly the same amount of space in the phone’s chassis.

Dual SIM capability into any phone, simply means the user can fit and use two SIM cards in their phone at one time. It is the wasted space for those who may not use the facility.

Apple has shown an interesting dichotomy of behaviour when it comes to the way they deal with SIM cards in their phone. Until now, even at the cost of breaking into the lucrative Chinese and South East Asian markets, they have ignored Dual SIM phones. On the other hand, it is no exaggeration to say that Apple but been the driving force behind pushing forward the eSIM technology standard that was required to facilitate its inclusion in this year’s iPhone.

Industry insiders suggest that the advantage to Apple of the eSIM, may be that the company wants to become a network reseller in many markets, cutting the phone company out of the conversation entirely.

It’s conceivable that Apple would own an iPhone customer from the moment they first pick it up to the second the device is finally disconnected – with Apple being your interface to every service you access in the meantime, including cellular networks.

Final Opinion – This Could Be Both Apple’s Most And Least Impressive iPhone Year

In summary, what’s most interesting about this year’s iPhone releases are not the things that Tim Cook pointed out in his announcement keynote speech. It’s the things that he didn’t.

Apple’s users have always liked things best when they allowed an ecosystem to be built around their core product and Apple has allowed others (in the form of 3rd party developers) to contribute to its success. It’s how their App Store worked, how iTunes made them billions of dollars and it’s what fuels the creation of all the laptop bags, iPhone cases and whatnots that people buy to ‘wrap’ around their Apple creations.

Apple’s Bionic chip puts Apple ahead of Android phones in terms of capability that was built to this year’s iPhone. It could be a strategy to build better iPhone experiences using Artificial Intelligence in the phone, delivered quickly through partners. This is strategic thinking ahead of any Android phone manufacturer.

Even more strikingly, the eSIM could redefine Apple’s its bottom line, potentially, completely disintermediating phone companies and allowing Apple to own the customer.

Wouldn’t it be ironic if this year’s iPhone releases were the most important to ever happen but the least impressive and if Apple delivered 3 things with it that are not even being discussed? The Dual SIM capability the phone now has opened up new markets in the short term. The eSIM could give Apple revenue from cellular network sales and AI-based apps could underpin the next generation of immersive Apple features.

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