Apple announces transition away from Intel chips

Apple will transition from using Intel chips to processors designed in-house, in a shift that chief executive Tim Cook called a “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 2020.

Intel’s shares rose 1 per cent in response to the timeline for the change.

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

“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 Johny Srouji, Apple’s senior vice-president for hardware. Mr Srouji spoke at WWDC for the first time since joining the company in 2008 to lead development of its “system on a chip”.

The move to Arm designs 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, the research company. 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”.

The transition from Intel to in-house silicon will be welcomed by app makers as the iPhone maker comes under fire from disgruntled developers over the company’s restrictions. These include the 30 per cent “Apple Tax” on subscriptions purchased through the App Store.

Apple’s WWDC is usually held in-person, with speakers often interrupted by cheering. This year, due to the coronavirus pandemic, it was pre-recorded and tightly edited in a cinematic style.

Many of the announcements had been widely expected, including new software updates to improve the user experience of fitness tracking and sleep apps, as well as Apple Maps.

But consumers looking for new hardware were disappointed. Apple did not offer a redesign of the desktop iMac, which was last overhauled in 2012. Nor did it introduce “Apple Tags”, a widely-anticipated “lost items” tracking tool that has caused rival Tile to complain that the tech group was abusing its power.

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

Apple also introduced iOS 14 for its smartphones and redesigned how apps are organised on the iPhone home screen. It also unveiled a new tool called App Library will 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. For instance, an iPhone user would be able to hail a scooter, pay for parking or use a coupon at a new coffee shop.

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

But Apple is aiming to differentiate itself through its focus on privacy. IPhone users will soon able to see a “nutrition label” that will display how an app tracks a user’s movements and uses this data. An Apple executive said, “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.”