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Intel's disruption is now complete
- dboreham 6y agoWhat's the real reason Apple can design a higher performance device? Better fab process? ARM ISA is fundamentally faster? Graph conveniently omits AMD who now beat Intel using the same ISA but different process.
- redvenom 6y agoIt's also the fact that they are putting everything on one chip. With an Intel chip it's just the CPU.
- pfortuny 6y agoI guess their sharp focus on phones and tablets led them to think... Hey, this is so powerful we might... And they indeed could.
- jibcage 6y agoApple has a greater incentive to optimize their chips for power performance because of their smaller devices (not just the phone, but the watch too).
- fpoling 6y agoSamsung has the same incentives. But their CPUs are far behind Apple.
- p_l 6y agoSamsung chip division doesn't have guaranteed "buyer" or option to build SoC specifically for given product (even if usually you can bet on next generation Galaxy device as your target, you still have to design as if you were selling to open market - and that means less option to, for example, throw a lot of memory/cache resources that have been the main differentiator of Apple chips - which started from the same design as Exynos!)
- CountSessine 6y agowhich started from the same design as Exynos Apple was actually the one designing those cores in the Exynos - up until and including the Exynos 4000. That was when Apple decided to sever ties with Samsung and stopped designing cores for them and Samsung had to go back to stock ARM designs with the Exynos 5000. That was why the 5000 series sucked so badly - Samsung lost access to those Apple/Intrinsity juiced cores. It’s also what prompted Samsung to open SARC in Austin.
- CountSessine 6y agoI'm wrong about that - it was the Exynos 3110 that had the Apple designed core that also appeared in the A4. And after that, it was back to ARM's humble designs for Samsung.
- p_l 6y agoHummingbird in SGS2 (this was before rename to Exynos) and A4 in iPhone 4 stem from cooperation between Samsung and Apple (who previously used Samsung SoC in iPhone 3G and I think in 2G). The teams split before both phones reached maturity in design. From then on Samsung kept iterating on the Hummingbird design till I think quite recently - I'm not sure if my Note 10+ doesn't still have cores derived from that design.
- chrisseaton 6y ago> What's the real reason Apple can design a higher performance device? Motivation to do so. Intel had none.
- trevyn 6y ago>What's the real reason Apple can design a higher performance device? Everyone else with the immediate capability are professional ball-droppers.
- skohan 6y agoPart of it is that they're essentially using all of TSMC's 5nm capacity, right?
- ben-schaaf 6y agoMy guess until reviewers get their hands on the thing is that they've got some pretty good RnD alongside the massive process node advantage over Intel. AMD has already shown that there's a lot more performance in 7nm than we thought and the M1 looks like it'll be on-par with what you'd expect from zen 4, so I wouldn't say they've got any advantage from the architecture (as you'd expect)
- ivalm 6y agoRight, but zen 4 is a year away. If Apple is a year ahead then that’s a lot (even if it is because they are able to use 5nm node fab capacity first)
- dragontamer 6y agoIntel dropped the ball on 10nm and 7nm processes constantly for the last 5 years. Skylake was the "tick", then they couldn't "Tock" to 10nm, so they made 14nm+, then 14nm++, then 14nm+++... Intel's been stuck on the same process for half a decade now.
- qayxc 6y ago> Intel's been stuck on the same process for half a decade now. Even worse - the same architecture as well, which is why they have to backport their 10nm Ice Lake architecture to 14nm to even get anywhere.
- bredren 6y agoThis doesn’t come up enough: intel’s ceo had to abruptly resign in June 2018 due to a relationship with an employee. [1] That could not have come at a worse time for a company like intel. [1] https://www.reuters.com/article/us-intel-ceo-idUSKBN1JH1VW https://www.reuters.com/article/us-intel-ceo-idUSKBN1JH1VW
- joeryscript 6y agoHonestly? A lot of it has to do with the fact that they booked TSMC's entire 5nm production capability for some time. So they are working on a smaller process node than their competitors, and they used their market position to ensure that they will be the only ones using it for a little while. That gives them a significant leg up.
- cma 6y agoYep, like when Apple got an exclusivity deal with Toshiba on its tiny-sized harddrives for use in music players.
- jeffbee 6y agoI'm still waiting for my M1 to show up but from studying the details that other people have commented on, it's clear that Apple is slathering on the microarchitectural resources that both Intel and AMD are stingy with. Their core has a gigantic L1 instruction cache, rather a lot of L1 TLB entries (4x more than Intel), large(r) pages by default, and many other aspects. L1 TLB entries in particular are a well-known problem for x86 performance so it's a real mystery why Intel doesn't simply add more of them. x86 is probably married to 4K pages forever, because of god-damned DOS, whereas Apple can make the default page size be whatever they want it to be. People with high requirements can jump through a million hoops to get their x86 program loaded into hugepages, but on Apple's platform you're getting it for free.
- frogblast 6y agoApple’s core is very wide. But wide usually means very high power consumption. M1 apparently has much lower power consumption. So something else is going on other than “Apple is willing to spend more to make cores wider”.
- BlueTemplar 6y ago> M1 apparently has much lower power consumption. Even compared to similar manufacturing processes ?
- Miraste 6y agoThere are no similar manufacturing processes, Apple has paid for time-limited exclusivity on 5nm.
- tuatoru 6y agoThe manufacturing process is TSMC's, so probably not. To me the innovation is using phone-type SoC technology. A lot of the power (and die area) demand in modern chips is in the interface circuitry to drive the few centimetres of PCB trace between ICs. Put the RAM in the same package as the CPU and you eliminate that interface. That gives you die space and power budget for big buffers and lots of parallel execution. Interface transistors (and wires) are many times larger than the core compute logic transistors (and wires), so there is much more than a one-for-one gain.
- streetcat1 6y agoMy understanding is that there were a lots of bugs in the current processors. It was quality issues.
- Tuna-Fish 6y agoThey have access to a fab process that is ~2 full generations more advanced than what Intel is shipping most their products in, and 64-bit ARM has one advantage over x86 (fixed-width instructions) which allow them to make a very wide core. Of those two advantages, the process one is a lot more significant. Their chip loses in single-threaded performance to AMD's newest, which are still one node behind Apple, but appears to be more power-efficient. I fully expect that once AMD gets on the matching node they will take the crown back, even in a laptop power envelope.
- CountSessine 6y agoPart of it is just that Apple spent a bunch of time hiring the right people and making the right acquisitions. Another part of it is just that designing a CPU with good single threaded performance is hard and costs a lot of die area and no one else in the ARM world was incentivized to do this - who needs a smartphone with that kind of performance (I know, I know - all of us, now)? But Apple also makes IPads which are kind of a bridge device - mobile and battery-powered, but also big and something people might want to do real work on. I’m also going to say that I think Apple is still alone among the phone manufacturers in recognizing that smartphones are software platforms, not simply hardware devices. I think they have a special appreciation for the enabling power of a more capable CPU.
- pas 6y agoLook at these graphs: https://www.anandtech.com/show/16226/apple-silicon-m1-a14-deep-dive/4 https://www.anandtech.com/show/16226/apple-silicon-m1-a14-de... The 5 Watt iPhone CPU almost beats the 45 Watt AMD CPU. And the M1 will then simply obliterate the x86 incumbents. Why? The real reason is that Apple had/has the real advantage. It's size, resources, money, strategy, know-how. It's bigger than Intel. It has a better corporate culture than Intel, it has a vertically integrated market completely safe from any outside disruption for years, and will be for years. It had the opportunity to do this switch, so it had the motivation to develop this capability. Apple was able to hire the best semi designers plus benefit from the ARM platform. AMD is still too small and relatively spread thin - trying to cover multiple segments of the general market - compared to Apple, which basically has this one chip in two versions (mobile and ultra mobile).
- dboreham 6y agoWell ok but by that theory Dec Alpha or HP PA should have dominated?
- protomyth 6y agoBoth examples were chips that were basically bought by Intel. The Alpha was a monster, and the PA ended up being replaced by the Itanium.
- pas 6y agoNeither had the underlying single enormous vertically integrated market slice. Apple has and had the iPhone. Apple started using their own chips, the A5, about 10 years ago. (In 2011 March, starting with the iPad 2. And they used ARM before that too.) And since then Apple optimized the "supply chain", incremental steps, but when you are Apple every step can be almost revolutionary (and year after year Steve told exactly that to the believers, and it's basically true, just not on actual feature front, but on hardware and systems level - eg. Gorilla glass for the phones, power efficiency, the oversized battery for the MBP, milling, machining, marketing, design, and so on).
- jibcage 6y agoI’m curious to see if Apple will bring anything similarly disruptive to the server market. So far servers haven’t been their strong suit, but a chip this attractive could change things.
- skohan 6y agoIt would seem really out of character for Apple to make a move in the server space.
- Someone1234 6y agoOr heck even just the general purpose chip space in general. Apple's current ARM offerings are strictly locked to their own hardware, and there's been no hints that they may move into the ARM-PC space selling general purpose chips and letting other vendors produce board. I'd expect to see that first before an Apple silicon powered server.
- skohan 6y agoYeah Apple's never been a component company, they're all about vertical integration. Still it's hard to imagine if they actually do end up producing the best price/performance processors that these would be relegated to consumer products given the massive opportunity it would represent in the server space for cloud-based companies to bring down costs.
- grecy 6y agoWe know they have tens of thousands of linux boxes running iCloud and the App Store and whatever else... if they can use their own ARM servers and reduce electricity use by 50%[1], you've gotta think they're looking serious at that, purely for themselves. Not to mention buying their own hardware will obviously save them. [1] https://twitter.com/ajassy/status/1318930486517927937?s=20 https://twitter.com/ajassy/status/1318930486517927937?s=20
- usrusr 6y ago
- voodootrucker 6y agoThank goodness. They haven't innovated in decades and x86 is a mess. I can't wait until RISC-V does the same to ARM. It's super frustrating to see America, which used to be innovative become the complacent corrupt incumbent.
- jeffbee 6y agoSuper, super weird take considering that Intel's main competitors are all within walking distance of their Santa Clara HQ.
- modeless 6y agoTheir only competitors that really matter are in Taiwan and South Korea. Fabs are harder than chip design.
- quantummkv 6y agoNope. That's were many people are wrong. Intel's main competitors are not in the US. They are in Taiwan and Korea. Intel's domination came not only because of a superior chip design, but due to the fact that only they could manufacture the superior chip design. Now since that is not an issue anymore, you see Intel getting beaten everywhere. And that is only because Intel's actual competitors in Taiwan and Korea are have now surpassed Intel.
- SoSoRoCoCo 6y agoI guess you didn't read about their Xeon Phi bi-directional ring architecture that achieved dozens of terrabytes/sec of bandwidth, their 512b vector-processor ISA, or, heck, just for giggles, the industry's first FinFet (and high-k dielectric) on p1270, p1272, and p1274. But, please, do go on.
- pinewurst 6y agoAnd it was such an outstanding success! Intel's customers were able to get so much use out of it - it'll always be remembered as a high point in supercomputing. Seriously - it was a resounding failure, even with Intel spending big bucks to convince this class of customers it was the future. There was little uptake and vast dissatisfaction with achieved results. IMHO I expect Xe to follow the same (very shallow) trajectory in HPC as in gamer graphics. There is one remaining large machine (DUG "Bubba") using Xeon Phi and that's only an artifact of software tolerance combined with a _really_ great deal received on Intel's remaining "Knights Whatever" parts inventory.
- ntsplnkv2 6y agoIt doesn't look good for Intel but this isn't the first time, so we'll see. But AMD is dominating them now on one front, and now a major customer of theirs makes their own chips which on the surface seem to be better.
- screye 6y agoI am not sure what Intel can do to come back to a strong position. Afaik, all of Nvidia, Apple and Qualcomm (dunno about AMD) pay significantly higher wages than Intel. If Intel is starting off on the back foot and cannot get top talent, then their decline is all but guaranteed.
- dragontamer 6y agoIntel is losing to TSMC most of all, in the manufacturing front. Intel needs to reach 10nm and 7nm, and they needed to do that 5 years ago.
- akmarinov 6y agoSadly, it’s looking like Intel won’t do 5nm until 2023 at which point TSMC is projecting 3nm. They won’t be able to catch up. On the other hand Intel is a huge national security interest for the US, so expect the government to help them out where possible.
- pastrami_panda 6y ago> On the other hand Intel is a huge national security interest for the US This. I'm actually surprised they have grown so uncompetitive considering the critical products their CPUs are presumably used in. But Intel has been a money making machine for many years, I don't think most people realize the amount of resources they've accumulated when they compare them to AMD et al. I just hope they don't make more lousy investments and actually focus on sorting out their core business problems.
- beezle 6y agoFirst (and I'm no expert here) I don't believe that (x)nm is the be all end all of cpu performance. Architecture still matters. Second, perhaps the AMD/Apple fan boys have not noticed but Intel has many times the volume of AMD and whatever ARM volume Apple will have (Apple is typically 10% of lap/desktop sales, up this year from Covid). The world requires Intel to meet its computing needs and no magic wand will give the other guys that capacity anytime soon. It is way to early to count Intel out.
- baq 6y agoThere’s just one missing detail here: intel was terribly, terribly bad at executing its plan. Tiger lake was supposed to be here on 10++nm or 7nm or whatever much improved process, which would make it extremely competitive if not the absolute best. Intel very well knew they’re in trouble if the expected process upgrades don’t work and they didn’t. It’s not like folks there don’t know how to plot that core vs Apple silicon performance graph.
- mark-r 6y agoWhat's interesting is that Apple apparently plotted that graph too. They knew exactly when that crossover was going to occur, for years now.
- rurban 6y agoThey certainly didn't expect the massive Intel fuckups from the last years. With the normal performance growth curve they would still be ahead. * Broken 10nm and 7nm fab process. No end in sight. Even IBM could surpass them. * Even with much stricter memory guarantee orderings they managed to break caching and C3 kernel/ user seperation security (Spectre, Meltdown, ...). * Temperature management. Eg AVX512! * The government "mandated" backdoors. Who would have expected such massive Boeing-like fuckups from the industry leader?
- chipotle_coyote 6y agoWell, "expect" might be a strong word, but not only have Intel's CPU timelines been routinely slipping for years, the generational improvements have been kind of pedestrian for years (relative to Intel itself when you go back to the early 2000s). Intel has been behaving like they have no real competition for over a decade, and what they were shipping became their "normal performance growth curve" -- I don't think they took either Apple or AMD seriously.
- ENOTTY 6y agoI don't understand this ridiculous conspiracy. What competent government would force one company to backdoor their products but forget about their other competitors, all of which are domestic?
- SoSoRoCoCo 6y agoAs someone who worked on Intel's phone chip: we definitely didn't win it. We fucked it up twelve ways to Sunday. Why: giant egos. There were turf wars between Austin, Santa Clara and Israel over who would design it, and the team that won out had long since lost its best principle engineers and had no clue how to spin the architecture to meet the design win. Otellini's hindsight hedge is pure spin: we knew the landing zone, we just didn't know how to get there. And the aforementioned turf war guaranteed we didn't get access to other teams' talent. I'm bitter because it was a really fun team when I moved from Motorola to Intel Austin, and then it just corroded over political battles.
- Someone1234 6y agoDo you think Intel can come back, or is Intel too dysfunctional/inefficient to recover?
- baq 6y agoAMD came back. Fabless, bruised, but also thin, agile and with a 10 year plan that thanks to TSMC they can execute more or less on schedule.
- Ericson2314 6y agoAMD came back from being second fiddle in the right market. Intel would have to come back from being first fiddle in the wrong market.
- SoSoRoCoCo 6y agoI think they have been a commodity for a long time. Rephrased, the discussion is similar to, "Will GE make a comeback in the refrigerator market?" Intel isn't going anywhere, they have many, many big customers to satisfy who simply cannot shift to ARM due to ROIs <=0. And after 30+ years of this, I also don' think there's anything new or revolutionary in silicon fabrication on the horizon. I stopped getting excited about CPU tech when AMD crossed the 1GHz barrier in the PC space. Could be burnout though.
- cbanek 6y agoAcidburn: RISC architecture is going to change everything. Zerocool: Yeah, RISC is good.
- baybal2 6y agoWhat is disruption? I myself feel that the scope, and meaning of the term grows with each passing year. This disruption, that disruption... what is of it? The word is progressively loosing any meaning.
- jimbokun 6y agoThe article is discussing disruption as described in this book: https://www.goodreads.com/book/show/2615.The_Innovator_s_Dilemma https://www.goodreads.com/book/show/2615.The_Innovator_s_Dil... In the article, the chart from Christensen's early work about disruptive innovation, and the chart of Apple chips overtaking Intel chips in performance, do seem to have a striking resemblance.
- whatever1 6y agoMy question is why Qualcomm while using the same arch, has not produced a chip as fast as the M1?
- S_A_P 6y agoI suspect there was some talent at apple that figured out some details which Qualcomm have not at this time. This guy seems to improve things at every place he has been. He left abruptly from Intel this year, which hopefully is not due to health reasons. https://www.anandtech.com/show/15846/jim-keller-resigns-from-intel-effective-immediately https://www.anandtech.com/show/15846/jim-keller-resigns-from...
- imtringued 6y agoQualcom doesn't have a business model that involves high end processors. Who are they going to sell those SoCs to?
- rsynnott 6y agoQualcomm is a virtual monopoly in the space it serves (mid to high end non-Apple non-Chinese phone chips); arguably it doesn't have that much incentive to do anything much.
- rurban 6y agoAnd they are supposed to be a much shittier company than Intel, or Boeing or Oracle. You need to be really desperate to work there.
- p_l 6y agoYou're missing the wildly different target that Apple can follow. Apple designs chips and devices in lockstep. When designers were working on various A-series chips, they knew the details of the device, and could optimise on that. Qualcomm doesn't get that kind of view. They make a generic CPU design for given market segment, and have to "please" much wider buyer range. As such, if they tried to apply some of the things that are publicly known about Apple designs, they would probably end up with a chip that would be hard to sell due to taking more space or having higher TDP etc. And before advent of multicore, Qualcomm was using the available space budget heavily to integrate the radio functionality internally (then it oscillated a bit over time depending on chip and market segment).
- 1970-01-01 6y agoAMD is also threatening Intel's business with the newest Ryzen chips. They're losing business on almost every front it seems.
- samfisher83 6y agoIn general mobile chip margins aren't great unless you are apple. That is why you don't see too many competitors in the mobile chip market. You have Qualcomm, but they have a Radio monopoly and their performance isn't that great. Intel architecture isn't even that bad. Intel used to have a manufacturing advantage which they longer do. That is where they are trailing: Material science and manufacturing. This stuff cost a lot of money and requires and lot of Research. This is the Kind of stuff MBA types don't necessarily want to invest in.
- baybal2 6y agoThere are multiple 4g, and 5g radio vendors, just most people never heard of them so obscure they are.
- samfisher83 6y agoThey are probably all paying QCOM they own a lot of the radio patents.
- fomine3 6y agoHuawei must be known!
- Kapura 6y agoI found this very interesting, and it seems a similar thing is happening to Intel in the DIY/gaming space right now. For a long time, the Intel i5/i7/i9 were the processors of choice for gaming, but AMD's Ryzen line has been making remarkable inroads, with the recently released Ryzen 5000 series boasting performance that competes or tops Intel's top chips in the space, and generally with lower power draw to boot. I'm not a tech journalist, but the way they seem to have done this was exactly what was described in this essay. AMD brought out "chiplet" designs, initially at the low end, but with significant performance gains generation over generation. Combined with simpler motherboard slot conventions, delay's in Intel's next-generation processes, and overperforming Intel in areas like streaming, the value case for buying AMD processors in this space has grown to the point where you would find very few enthusiasts who would strongly recommend Intel over AMD if you're building a new system and wanted the best performance at your price point. Seems the infighting issues described by another poster have not only affected Intel's competitiveness in the mobile space.
- greggyb 6y agoEven the first generation of Zen was not the low end. The low end of x86 is well below anything whose name starts with 'Core' or 'Ryzen'. Ryzen came in the door at #2 in a market that goes well beyond #10. The motherboard conventions aren't simpler, just longer supported. AMD is doing impressive work with Ryzen, don't get me wrong, but they've already been #1 in x86 performance before, in the mid-aughts. Before and after that, their flagships were #2 in x86.
- delfinom 6y agoWell, AMD is marketing they have 20% YoY perf enhancements in the pipeline for the next 5 years. They also developed an internal org structure for developing 3 generations in parallel across teams. I would say AMD has high hopes because they have realigned themselves to being successful rather than the corporate rot Intel is suffering
- artboomy 6y agoDo you have any links to read about "developing 3 generations in parallel"?
- bkmn 6y agoIs it really that meaningful to talk about disruption if the product being disruptive isn’t available on a general market?
- HacklesRaised 6y agoWhat percentage of pc unit sales do Mac's make up? Anybody seriously see that market share growing because of M1? Mac's have a lot of baggage to overcome, not saying they can't but by both amd and Intel are not work shy lightweights and many of the advantages of the M1 do not translate to the expandable platforms the pc world expects.
- abhiyerra 6y agoI think another thing to consider is AWS Graviton2 and that based off ARM as well.
- HacklesRaised 6y agoTotally agree but Graviton, impressive though it is, doesn't have the aggregate advantage of M1, Intel is setup to respond to that challenge, M1, not so much.
- blackoil 6y agoBetween all the buzzwords and Intel hate, what is the technical tldr of Intel's position? I understand they are about 1.5 gen behind TSMC, they should be at 7nm which will compare with TSMC 5nm. Also ARM is currently more power efficient. Any other fundamental difference between AMD/Apple/Intel arch. If magically Intel 7nm gives awesome yield next year, will they be able to catch up with a bigger caches and Big.small arch. Will they need lot more help from Windows / Linux to achieve performance gain in lockstep like Apple does by controlling both OS and processor?
- supernova87a 6y agoMaybe this is a bit of a side topic, and I'm a layman, but I'm interested to know why the M1 chip is able to perform so surprisingly better? And why Intel or others can't just come up with a similar design, if it's clear from the specs/die images what's being done? Is it years of work to figure out the placement of CPU/GPU/memory units on the die, routings, and come up with new instruction sets? I imagine this wasn't new physics, Apple was just using contract fabs, right? What's the secret sauce that let them pull this off, and fend off others? Edit, oh, this is somewhat answered below in https://news.ycombinator.com/item?id=25093313 https://news.ycombinator.com/item?id=25093313
- ksec 6y agoIntel's current design are 1-3 years late depending on which roadmap and sector you are counting. Caused by their 10nm delay. Intel had Tigerlake / WillowCove Design but they cant ship it. They also have Golden Cove. If you have put the design they were suppose to be using now, on a IPC basis Intel might still be in the lead.
- petra 6y agoSo basically given the same process, all companies have almost a similar offering?
- atty 6y agoDisclaimer: I’m a chip design enthusiast and not a professional, but this is how I understand things right now. If you read the anandtech article describing the A14/M1 chips, it seems that the ARM ISA lets Apple do some things that are either exceptionally hard or impossible on x86, like making individual cores much “wider” in terms of instruction decode, allowing the A14/M1 cores to do significant parallel execution. This allows their cores to be significantly more efficient in terms of instructions per clock cycle. To be clear this isn’t just the benefits of ARM - Apple is far ahead of other ARM designers as well. On the other hand, the wider the execution pipeline, generally the slower the cores have to be clocked (Im actually not sure why this is, to be honest). This is part of how Intel is able to produce chips in the 5.0+ GHz range. So it’s not that every designer converges to the same design (internally, they’re quite different). Instead, what’s happening is that all the relevant trade offs (pipeline width and depth, ISA, fab tech, power targets, etc) are leaving competitors within an order of magnitude in performance. And the question of who’s going to take the lead is a question of who’s executing best on all these fronts, and who’s currently got a lot of talent working on areas that will see continued improvement. But whatever happens, I wouldn’t bet against Apple. Their team has been delivering improvements like clockwork, year over year for quite a long time now.
- daxfohl 6y agoOptane seems to be their one bright spot engineering wise. But unfortunately they have priced it beyond what the market will bear.
- hyperpallium2 6y agoThat chart is not of competing technologies, but of market demand and one technology. The classic disruptive chart shows two technologies improving in parallel, but the performance customers demand doesn't increase as fast, so eventually the disruptive technology is "good enough" for those customers (even though the incumbent technology is better still: it "overshoots") and has other desired qualities (like battery efficiency), so customers all switch to it. Here, of course, Apple is unlikely to sell its chips to other manufacturers... so any disruption will be at the product level: affecting wintel laptops, desktops... and eventually perhaps game consoles and linux servers. Everything. BTW I really enjoy his theories, but let us note that Christensen himself assessed the iphone as non-disruptive.
- jldugger 6y ago> let us note that Christensen himself assessed the iphone as non-disruptive. Which I suppose it is, but I think it's important to ask: if Apple didn't introduce a disruptive technology, why were they able to do what Nokia didn't? Its hard to deny how the iPhone represented a power shift away from carriers. It's easy to forget but a decade ago you had to pay carriers for the privilege of changing your ringtone. They had their fingers in every pie, in exchange for access to the market the carriers more or less controlled. Hell, you often couldn't even bring your phone if you switched carriers. Nokia was too busy pleasing their customers: the big cellular providers who ordered most of their phones. And the status quo heavily favored them -- the top selling phone of all time is still a Nokia phone from 2004. They didn't really have any idea how to market direct to consumer and their brand had no particular meaning -- they made as many SKUs as carriers wanted. Since they were in a clearly dominant position, they had no need to arm twist the weakest player to break into the market, and a lot to lose if they played hardball. Clay's right that it's not a traditional "cheap tech finds a new purpose undermining more expensive status quo" but it definitely rhymes -- all the incentives are the same and adequately explains why Nokia fell apart.
- warkdarrior 6y ago> let us note that Christensen himself assessed the iphone as non-disruptive Indeed the iPhone can be seen as opening a completely new market, instead of disrupting an existing technology. Laptops still exist, desktops still exist, servers still exist. iPhone expanded the technologies available, did not replace any existing one.
- DrBazza 6y agoThis article assumes Apple was/is the only x86 game in town, and completely ignores AMD. A quick google says Apple own about 7% of the "PC market".
- klelatti 6y agoThe classic disruption story is clearly important here as is the pattern of recent failings by Intel. There have been other factors though that contribute to a more complex story: - The availability of third party IP (Arm CPUs and originally Imagination GPUs) and manufacturing (Samsung and TSMC) that have allowed Apple to pick and mix to build its own SoCs. - The fact that Arm has clearly been much more focused on power efficiency which might mean it has IP which Intel can't access (speculating here but we have big.LITTLE). - Possibly the most importantly, the the benefits that Apple gets from being able own the whole stack and design SoCs that precisely match its needs. As a result I'm a bit sceptical about whether Intel would have got Apple's mobile business long term given that market's eventual structure: the advantages of Apple's current approach are just too great.
- mrg3_2013 6y agoLong time coming. They simply didn't understand how s/w world works, never hired people who understood how customers were actually using their processors. It was/is a h/w company that had manufacturing advantage - but lost all their edge because they strayed far too away from end customers. They obsessed over their own capabilities and missed out on the world view.
- intricatedetail 6y agoDid Apple mislead Intel about the volume to get a "no"? That would be inline with hostile nature of this company. Profit above anything.
- usefulcat 6y agoOT: I can't help hearing that title in the voice of James Earl Jones as Darth Vader.
- systemvoltage 6y agoThe entire world has their eggs in one basket - Taiwan Semiconductor Manufacturing Company. Say whatever about Intel, I am hoping that they get back on their feet in next few years with 5nm manufacturing. Since when is competition and choice a bad thing? If you're a chip design firm and you have a 8-month backlog to get your masks made at TSMC, what do you do then? TSMC can be world's best fab but we need to address the SPOF condition that is so close to the political hot zone in the APEC region. Intel should spin off its Fab division as a separate company, hire some top executives to rejuvinate the workforce, make it the coolest Fab company in the world to work for and leap ahead. Intel TMG's Sohail was the biggest borderline criminal executive that was forced out a couple of years ago and was responsible for the 10nm delays. It is enormously difficult for any startup to get into this space - you need billions and years of expertise to start a Fab. Or may be YC folks can? I worked in the Fab but don't have a birds-eye view of what it takes for a startup to get into this space. It would be amazing to see startups trying to manufacture semiconductors... you know live up to the Silicon Valley's name. You could have billions of dollars of economy built on services - US, EU and most advanced economies are shifting towards services; but they all rely on semiconductors. Imagine something were to happen to that... It is a juicy problem. We don't need Uber/AirBnb unicorns out of SV, we need Fairchild of the modern world from SV. Edit: To see what kind of a beast EUV litho is, this is a good short documentary on it: https://www.youtube.com/watch?v=f0gMdGrVteI https://www.youtube.com/watch?v=f0gMdGrVteI
- regimeld 6y agoCompletely agree. The world's supply of semiconductors is dependent, in some ways, on the benevolence of the CCP. TSMC is like Arakkis. We need to diversify the supply chain.
- aaaxyz 6y agoIsn't TSMC building a fab in AZ? Anyway I'd say the "spice" in semiconductor production is rare earth elements, since the CCP controls most of their extraction (and has artificially lowered exports in the past)
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- whack 6y agoThis is a controversial opinion, but I don't agree with the idea that big corporations should make an entry into every single adjacent market. If the company has core expertise and advantages that can deliver a decisive win in a known-lucrative market, then it's a no brainer. But if that's not the case, why run around chasing shadows everywhere, instead of focusing on harvesting the markets where you're already winning. "But if you don't expand into other markets, you'll eventually die!" Sure, but that's not a bad thing. The purpose of a corporation isn't to continue existing in perpetuity, but rather, to maximize returns for its investors. You found a gold mine? Great, go mine it until it runs dry, then close up shop and call it a day. There's no need to spend half your profits on a wild-goose chase for other gold mines (blackberry investing in self-driving cars anyone?) - if that's what I as an investor want, I can just use my dividends to invest in other companies or startups that are aiming to do exactly that. I'd rather invest in a company that sticks to the things that it can reliably excel at, and direct its profits back to me, so that I can then invest it in other companies that I trust in other fields. A company that is spending half its profits trying to be something it's not - that's my worst nightmare as an investor.
- Invictus0 6y agoNo company operates this way. Companies are full of people optimizing for their own fortunes, and the company going under is not and will never be a part of those plans.
- weehoo 6y agoMany creative productions take on a similar structure to what he proposes. Many entities, some individuals, some partnerships, and some corporations, come together to produce a single work. The associations dissolve when the work is finished. Films, albums, festivals, etc.
- masklinn 6y ago> This is a controversial opinion, but I don't agree with the idea that big corporations should make an entry into every single adjacent market. If the company has core expertise and advantages that can deliver a decisive win in a known-lucrative market, then it's a no brainer. But if that's not the case, why run around chasing shadows everywhere, instead of focusing on harvesting the markets where you're already winning. The risk is that a competitor comes out of these adjacent markets and edges you out. That's what's looking likely to happen with ARM, which is slowly moving from embedded / cellphone to laptops and servers.
- poisonborz 6y agoIntel CEO on them losing the iPhone CPU deal: > "We ended up not winning it or passing on it, depending on how you want to view it. And the world would have been a lot different if we'd done it" No, it wouldn't. Maybe the iPhone would have been delayed 1-2 years. But they surely didn't have the capability to make this CPU properly, as all of their attempts in this field in the coming years demonstrated.
- ksec 6y ago>It was not until 2005 that Grove retired from Intel. October 2007, CFO Andy Bryant Promoted to Operations Chief. September 2009, CTO Pat Gelsinger left Intel. 2010, CEO Paul Otellini started work on Intel Custom Foundry. July 2011, Andy Bryant was appointed Vice Chairman on Intel's board. May 2012, Andy Bryant became Chairman of the Board. May 2013, The Board appointed Brian Krzanich as new CEO. And the more recent event you should all be fairly familiar. Other than that, If I could sum up Intel's problem in one word, it would be Inertia.
- ezluckyfree 6y agoApple is worth 2 trillion, and TSMC $410 billion. I'd hardly call that "disruption".
- wombatmobile 6y agoGrove embraced Christensen's paradigm for innovation and backed this learning with investment and the risk of cannibalisation inherent with Celeron. It's easy to be wise after the fact, but we can now say that Grove or Otellini didn't take a big enough risk. Instead of risking cannibalisation of their core markets, they might have won a bigger prize over the longer term by straying further. Desperate Gamers Camp Out in the Pandemic for $700 GPUs Months after the Nvidia GeForce RTX 3080's launch, the lines at brick-and-mortar stores across the country can still wrap around the block. https://www.wired.com/story/nvidia-amd-demand-pandemic-lines/ https://www.wired.com/story/nvidia-amd-demand-pandemic-lines... C'est la vie.
- BMSmnqXAE4yfe1 6y agoThat's kinda sad, because Apple is much bigger than Intel. And it seems those bulldozers will never stop until there is only one company in the world - my bet the final battle will be between Google and Amazon.
- xchaotic 6y agoQuestion: now that we know that Intel is dead and stuck on 14nm process why has the share price not tanked yet? I mean it should be trading on the future PE?
- pavlov 6y ago“The Innovator’s Dilemma” has a rather terrible track record as a handbook for tech corporations. Nokia’s leadership was also big fans of this book in 2000-2010. They saw themselves as the nimble disrupters, eventually eating away all computing markets with their cheap plastic phones and a smartphone OS derived from embedded systems. If Nokia would just keep adding features, the Christensen theory promised that they’ll one day own the upscale markets too, like in all those case studies in the book. Instead Nokia’s business was destroyed by actual innovation: Apple combined a new kind of mobile UI with an OS derived from high-end PCs. It didn’t fit on the ladders of innovation shown in the book. It wasn’t a cheaper thing becoming good enough, but an expensive thing that was nearly impossible to manufacture initially. And that’s why Nokia thought they could safely ignore it, until it was too late.
- ineedasername 6y agoI don't think Intel is out of things. Apple's M1 chip on preliminary analysis looks like a huge game changer.... for Apple. They don't have much of a history of licensing their tech (except for a disastrous period of Mac clones waaay back) so I don't see the M1 disrupting the notebook/desktop market. That leaves AMD. AMD Isn't eating Intel's lunch, they've had a pretty good taste of it and are about to say "no, not just lunch, we're taking all the food". But there's a window. My not-very-expert opinion is that the window is 2 years. That's how long Intel has, while AMD chips away its market share with new installed systems, to turn things around. If they do it, they'll still have to claw back their previous position, or there will simply be a new stable equilibrium, but I think Intel's dominance in the server & consumer-grade space gives them some breathing room. In the consumer space, shoppers for high end systems e.g., gaming etc are gone: AMD has them now, and more every day. They have me, that's for sure. But the much much larger consumer market is not in gaming. Intel has the name recognition for the average consumer, and it's their hardware in most consumer grade systems. A quick glance at a dozen consumer grade laptops & desktops from HP & Dell don't show any AMD CPUs in them. So, Intel still has that level of inertia. If they can limit the bleeding in server & high end systems to a rapid bleed-out instead of a near instant & complete gushing torrent, that inertia may be enough to allow them to claw things back if they're able to execute within the next two years. I'm no Intel fanboi: They lost me unless/until they turn things around. And from where they are now, I don't rate their chance more than 50/50, which might be generous. But I do think they've still got 2 years until their viability is really threatened. At that point, and I'm sure they've got some skunkworks & low-profile conversations going on about this already, they'll need to look at offloading high performance fabs to TSMC. Personally, from a global strategy standpoint, I think the US might not want to lose what is really a strategic asset that way though, so we could also see some type of subsidy/bailout/whatever to prop them up.
- kristopolous 6y agoHonestly I've got a few thousand invested in them on the currently unfounded bet that they'll weather this storm despite the current lack of any evidence. I made a similar bet on SUN about 17 years ago and a smaller one on RIM (Blackberry). I'm getting a deja vu. This all started when I bought a bunch of Apple stock around $2 and for the past 20 years I've been trying to make that play again. I guess I'll have to admit this position in GE is similarly worthless. I gotta stop making these gambles of faith, Intel has ceded nearly everything and is defending their remaining kingdom poorly. Unless there's a major overhaul, things aren't looking good. They've also been bleeding talent for years. I need to stop second guessing what I find obvious. Nvidia, Arm and AMD have already stormed the castle and have been pillaging the kingdom for years now. Once you see companies like TI and Marvell start to take significant pieces away then you'll know they're done for it.
- haltingproblem 6y agoExcept the empirical data does not really back Clay's thesis in The Innovator’s Dilemma. Jill Lepore had an excellent analysis of the track record in a famous new yorker article (1) which caused pmarca to melt down on twitter. In his defense, I think the disruption thesis holds when the industry is fragmented. When a disrupter goes up against a monopoly/duopoly or oligopoly, it fails. Just a conjecture. Even more generally, in business there are few hard and fast rules and even the ones that work lose their efficacy as the participants learn and adjust to them. Which is a good thing for the system as a whole. I would speculate that entrepreneurs should now look beyond disruption. (1). http://www.newyorker.com/magazine/2014/06/23/the-disruption-machine http://www.newyorker.com/magazine/2014/06/23/the-disruption-...
- m0zg 6y agoIndustry behemoths do need near-death experiences from time to time. Intel is not yet near-death. They still have overwhelming market share and it still seems to them that they are "succeeding". Their future will depend on whether or not they choose to get high off their own PR supply.
- Lammy 6y ago> And Apple converted. Steve Jobs invited Otellini on stage at Macworld to make the announcement. In case anybody was wondering why Otellini was wearing a cleanroom suit on stage, it was a reference to Apple's 1998 "Toasted Bunny" commercial for the Power Macintosh G3: https://www.youtube.com/watch?v=e6PoLiXCA40 https://www.youtube.com/watch?v=e6PoLiXCA40 …which was itself a reference to the Pentium Ⅱ commercials of the time: https://www.youtube.com/watch?v=qvt65mHXmR4 https://www.youtube.com/watch?v=qvt65mHXmR4
- calinet6 6y agoCtrl-F "AMD"... 0 of 0 Wow, they don't even know exactly how disrupted they are...
- mixmastamyk 6y agoGreat article. However, I doubt Apple is interested in intel’s server business. It will probably save the company.
- jl2718 6y agoNo. Grove never understood disruption. Celeron was a strategic error. Otellini was right in foresight and wrong in hindsight on the iPhone. “Disrupt yourself” is a terrible strategy. That’s the entire point of “The Innovator’s Dilemma”. Intel’s real disruptive strategy was the Pentium Pro architecture that disrupted the mainframe market, proven by ASCII Red in 1995. But you don’t hear about that because the business leaders didn’t even know it existed (same with multi core btw). The problem with this, as with all disruption, was low margins, so IA-64 was an attempt to enter the mainframe market as a peer of the high-margin encumbents, and was itself disrupted by the broadly inferior but cheaper AMD64. Low-margin ARM disruption also should have been expected as normal and unavoidable. The big question is what market Intel can disrupt next. I have criticisms I’ve held back on, but one thing I will say is that Intel’s portolio of disruptive technology is greater than I had expected. Leadership has to be able to put together the pieces. NVidia, for example, probably has less core technology, but their direction is more aligned.
- mensetmanusman 6y agoThat is amazing to see the innovator’s dilemma performance vs. time plot play out with Intel. Does anyone know of a collection of other similar crossing plots on this topic? Would be really cool to study those...
- achriduwan 6y agoBuka sms Reisye EW