New A9 Chip Will Be 'Made in America' For The Powerful iPhone 7

The iPhone 6 Plus (image: Ewan Spence)

The first A9 chips have rolled off Samsung’s fabrication lines in Austin (reports the Korean Electronic Times). The chips will be used in the next-generation iPhone from Apple, potentially exploiting Samsung’s 14nm technology. I’m confident that Phil Schiller will have a number of graphs ready for a presentation to show the A9 is faster, more efficient, and uses less battery power than ‘any other chip we’ve ever designed’.

Questions remain over which device the A9 chip will power and when it will be launched. Many industry watchers are still considering the idea of two iPhone releases next year, one to coincide with the launch of the Apple Watch in early Q2 and a second in the traditional September slot.

Apple iPhone 5c (image: Apple.com)

Releasing an A9-powered smartphone after the A8-powered iPhone 6 and iPhone 6 Plus have been on sale for just over half a year feels like a bad move that will affect customer goodwill. The initial adopters (and all of those who have picked up a new iPhone at Christmas or as part of the Chinese New Year) will be left with ‘last years model’ after a far shorter release window than normal. Apple has moved this quickly to refresh a product line once before (in the move from the iPad 3 to the fourth generation iPad) in what was widely seen as a mis-step of marketing.

It’s unlikely that Tim Cook’s Apple would make the same mistake again.

The Apple Watch (Courtesy of Apple)

The launch of the Apple Watch is likely to see a spec bump in the iPhone 6 and 6 Plus range. Raising the lower storage option from 16 GB to 32 GB would mirror storage jumps and mid-season bumps seen during 2014 for the iPad, iMac, and iPod portfolios.

The A9 chip will need to go into mass production at some point to allow Apple to build up significant inventory for a presumably late-September release of the iPhone 7. The current production is likely to be for a smaller ‘custom’ order that will be used in the prototype/beta builds of the iPhone 7. The new handset’s technology will need to go through extensive testing on the Apple Campus and out in the real world (even if the final chassis and case design will need to be disguised).

The impact of the A9 manufacturing is less on Apple (because this is an expected part of Apple’s yearly iPhone cycle), but will be felt more positively by rivals Samsung.

Samsung noted in October that its semiconductor business would be receiving significant orders during 2015. Apple switching back from the Taiwan Semiconductor Manufacturing Co. (which took on the majority of the A8 orders, roughly sixty to seventy percent according to Apple Insider) to the South Korean company will be a significant part of that order book.

Samsung also allows Apple to bring more work back to the United States through the use of Samsung’s Austin plant.

Kim Ki-nam, President of Samsung’s semiconductor business told reporters in October that the company’s profits ”will improve positively” once the company begins to supply Apple with the latest technology chips (reports ZDNet and others).

While Samsung’s smartphone business may be looking at a tricky 2015, Apple’s return to Samsung’s semiconductors for the bulk of its orders will provide the South Korean company with significant revenues as JK Shin looks to re-establish Samsung’s Android dominance.

The irony that Apple’s order will be propping up its major competitor will be lost on nobody.

Source:- http://goo.gl/AP9n71