Raving reviews of M1 – Apple continues to deepen its moat

A couple of weeks ago, Apple announced their new Macbook Air and Macbook Pro with their own designed chip M1. The chip is touted to be much more powerful and power-efficient than all previous Intel chips or many chips on the market. Due to the new chip, the new Macbook Airs won’t have an active cooling system because they will not consume energy aggressively and the battery will last significantly longer, to the tune that, Apple alleged, you may get by the whole day without a charge. The same goes for Macbook Pro, except that the Pros will have an active cooling system. Since the products were available, there have been raving reviews on the Macs with M1, despite some shortcoming such as iOS apps running on the Mac, the touch bar or the quality of the camera (which nobody ever likes). Here are a few excerpts that I found really interesting

Apple’s new Macs based on the M1 system on a chip, the first Macs based on Apple Silicon, are that sort of mind-bending better. To acknowledge how good they are — and I am here to tell you they are astonishingly good — you must acknowledge that certain longstanding assumptions about how computers should be designed, about what makes a better computer better, about what good computers need, are wrong.

Some people will remain in denial about what Apple has accomplished here for years. That’s how it goes.

The M1 Macs are such better machines than their Intel-based predecessors it’s hard to believe. Apple’s battery life braggadocio is warranted. The battery just lasts and lasts and lasts. I’ve been using this MacBook Pro almost exclusively on battery power all week, doing both all my normal work and running benchmarks and performance-stressing tasks, and I can’t come close to depleting it in a full day of work. It never gets hot. In normal use, it doesn’t even get warm. Maybe, sort of, when running a fully-taxing test like the Cinebench multi-core CPU benchmark, it heats up to just past room temperature above the Touch Bar, but it bears no resemblance thermally to a taxed Intel-based MacBook Pro.

As I type this paragraph I’ve been working for just over three hours, nonstop, with the MacBook Pro unplugged the whole time, and the display as bright as I want it to be. The battery is at 80 percent. To say that it offers merely “all day battery life” would require me to work very long days.

Source: Daring Fireball

Intel and AMD have to talk about gigahertz and power because they are component providers and can only charge more by offering higher specifications. “We are a product company, and we built a beautiful product that has the tight integration of software and silicon,” Srouji boasted. “It’s not about the gigahertz and megahertz, but about what the customers are getting out of it.” 

At a human level, all of this means that you will see your system as soon as you start to flip open the screen. Your computer won’t burn your lap when doing zoom calls. And the battery doesn’t run out in the middle of a call with mom. It’s amazing what goes into making these small-seeming changes that, without many of us even realizing it, will transform our lives.

Source: Om.co

Or this hilarious and awesome review by Joanna Stern

The tech review is fair in giving credit and crap where credit and crap are due. This is to say that so far the new Macs with chip M1 look very good, true to a large extent of what Apple claimed them to be.

This brings me to my main point: with the new chip, Apple is deepening its competitive moats.

Think about it this way, here is what a competitor would need to do to compete with and usurp Apple:

  • Manufacture a slew of different hardware products like a phone, personal computers, a tablet, wireless earphones and a smart watch
  • Own the operating systems that power those physical products
  • Manage a tight integration
  • Create an ecosystem that features developers and consumers
  • Offer valuable services such as iMessage, Apple Pay, Health, Apple Pay, iBooks etc…
  • Stick to the enduring philosophy of offering incremental progress that makes consumers’ life better, instead of achieving meaningless technical numbers
  • Have a strategy and stick to it
  • Possess a world-class brand and a boatload of money
  • Run a sophisticated supply chain that spans across the globe
  • Design a great chip
  • Achieve many, if not all, listed above at the same time

Besides delivering values that customers deem worth paying for, the key to succeed in business is to do certain things better than your competition. The more things a company excels at and the more intertwined those things are, the better the outlook for that company is. In the case of Apple, it’s already hard enough to create just a phone to compete with them. Ask Samsung. It’s much harder to keep being competitive at it and try to fight other battles as well. When I look at Apple’s competitors, I don’t see the tight integration between hardware and software that Apple excels at. Google owns Android, but it is not a hardware company. Samsung can produce hardware, but it doesn’t own Android. Apple produces its hardware and owns the operating systems. It already has the coveted software-hardware integration. With the new chip, Apple takes the integration to another level. Now, the chip, the software and the hardware are tightly integrated and we can see earlier on the results of such an effort above. Granted, there are still shortcomings that Apple needs to fix, but that should be expected. There is no perfect roll-out. The next generations of products with Apple’s own chips will be even better; which should be exciting for users, but scary for its competition.

In addition to the tangible aspect, there is also an intangible element here in the mix as well. A company that wishes to emulate what Apple does needs to study how Apple is internally set up and how the long established culture is influencing its operations. You can’t go and ask Ferrari to produce a low cost car while keeping their style. On the other hand, it would be highly challenging to ask Aldi to have a store like Whole Foods. It’s not in their DNA. To be clear, the Apple way isn’t the only way to succeed in the business they are in. Depending on how you define success, there should be more than one way to achieve it, but to achieve the success at the scale that Apple has, their way is the only way so far.

For a company that wants to emulate Apple’s success, it needs to either recreate the Apple way which poses a significant challenge or to have a groundbreaking and completely different idea whose outcome is far from certain. Apple is far from perfect. I find it annoying that they ship buggy software more frequently. They tell you new operating systems work with older Macs. Trust me when I say this: they don’t always do. I had my Mac’s hard drive wiped out so that I could get rid of Catalina. I am still on Mojave because if I upgrade, I may as well buy a new computer. My friends don’t dare to upgrade their MacOS to Big Sur and the only one that did regrets it immensely. I also don’t like their pricey rip-off accessories such as a Mac cord or a wireless mouse. There are other reasons why folks are legitimately annoyed by the company. But all of their shortcomings (who among us doesn’t have one?) shouldn’t dispute the fact that Apple is one of the best run companies out there and their competitive advantages are not only already daunting to overcome, but getting bigger and bigger.

Nothing lasts forever. While I do think we should keep a powerful company like Apple honest all the time, as a business student (I am no longer in school, but never stop learning), I think we should appreciate an extraordinary achievement of a group of people who, despite all the success and $2 trillion+ valuation, keep moving forward. This is a company that is under intense scrutiny constantly and subject to standards higher than what is expected from many other businesses. They aren’t a cheat that scams investors or consumers, and I am using the word “scam” as in promising the moon but delivering nothing. No matter how one may think about it, Apple has delivered products, services and financial performance that few companies can every year since 2007. I learned a lot from this company, let’s just say, both goods and bads. Luckily, the former far outweigh the latter.

Disclaimer: I own Apple’s stocks in my portfolio.

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