How Will the A7 Chip (64-bit) Make the iPhone 5s Better?

It will motivate some consumers at this point, but probably only a small fraction. What, then, might this really be all about?
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This question originally appeared on Quora.

Answer by Ian McCullough, Consumer Technology Product Manager

Built into the question is an assumption that the rollout of the A7 is principally about making a better consumer experience. It will -- but consumer benefit isn't the main reason to advance the architecture. Keeping iPad in mind as well, the A7 will help with things like games and visualization apps (including, probably, additional on-device rendering improvements in Maps). I also believe that the GPU and improved bandwidth will make subtle differences with all of the sliding layers and translucent effects in iOS 7 -- at least enough of a difference to make those who are deeply committed to the aesthetics and kinesthetics go "ooo!" and "aaah!" while comparing to an iPhone 4S or iPhone 5C when considering a purchase and subsequently showing off to their friends.

It will motivate some consumers at this point, but probably only a small fraction. What, then, might this really be all about?

If one had to pick the most important day in the history of Apple's mobile devices business, many would be tempted to pick the introduction of the iPhone. Others would choose the introduction of the iPad. I'd like to make a case for September 7, 2005.... also known as The Day They Killed the iPod Mini.

That was the day that they flat-out axed their phenomenally top-selling iPod model and replaced it with the first generation iPod nano, a device with less capacity for which they charged a higher price. That was the day they bet the business on Flash Memory.

The first rule of business is "sell something for more than it costs you to make it." When you look at Apple's business holistically -- hardware, software, and content -- it becomes clear that the core of what they do is sell storage and then give you reasons that you must have MORE storage. Apple has bought up Flash manufacturing capacity at plants years ahead of others, giving them a major advantage on the cost of that critical component. With that understanding, you have a lens to look at the rest of any Apple device and (for that matter) the whole ecosystem as a set of storage-eating technologies.

Some items to consider:

  • Apple introduced the iTunes Music Store in April of 2003. This made it easier to buy songs and fill up your iPod. Once you fill up your iPod, do you want to invest energy in managing your collection? Generally, no ... so you buy a bigger iPod.
  • In October of 2005 -- a month after the Death of the Mini/Birth of the Nano -- Apple first introduced video into the iTunes Store. Video occupies a whole heck of a lot more storage than space then music!
  • In May of 2007, Apple rolled out "iTunes Plus" on the iTunes Store. In October of 2007, iTunes Plus became the default purchase option for any tracks so licensed. By April of 2009, all music on the iTunes store was "iTunes Plus." For those who don't remember: iTunes Plus encoded music at a bitrate of 256 Kbps -- twice the previous default rate of 128 Kbps, and therefore larger size. iTunes Plus also removed Apple's "FairPlay" Digital Rights Management from music files. Do you remember Steve Jobs' "Thoughts on Music" Open Letter? On one level, some people saw this as Steve Jobs taking a principled stand about the futility of DRM and the importance of giving consumers what they want. On another level, if people are free to share and swap music files, then they will also be accumulating music files. More music flowing around from person to person = more storage consumed.
  • How about HD Movies for sale in the iTunes store? Yep, they're definitely bigger. In 2012, Apple further upped the HD quality from 720p to 1080p. You can use AirPlay to send your movies from your iPhone, iPad, or Mac to your Apple TV that's hooked up to your HD television. (Do you think that Apple is excited about 4K resolution?)
  • Progressively fancier-pants cameras in iPhones and iPhones and iPads also create images and videos that consume more space. Think about the effect of these: more megapixels, HDR, panaromas and today's adds of burst mode, slo-mo video, and a redesigned CCD with a larger surface area & bigger pixels. On the software side, iOS 7 has added filters and iPhoto and iMovie will now be free; you can use your photos and videos to create even more photos and videos!
  • Retina Display upped the conventional LCD screen pixel density from 72 dpi to 308 dpi. Not only does that justify consumers using the camera settings for fancy personal photography, it creates a HUGE incentive for App developers (especially game developers) to use higher resolution images in their applications -- which increases the size of the application packages. Epic Games was featured in the presentation, so I'll use them as a case in point. Infinity Blade is listed as having a size of 624 MB. Infinity Blade II has a size of 1.1 GB. We can only speculate how big the upcoming Infinity Blade III will be.
  • The iCloud services like Backup and Photo Stream are a variation on this where they sell remote storage -- Dropbox-style. Photo Stream has the added benefit of making it easy to send and subscribe to other people's albums, which puts more pictures on your local device, which uses up more local storage, which means that you need to buy a more expensive device with more capacity.
  • Apple makes its money off of a corollary to Parkinson's law: storage requirements will increase to meet storage capacity. I don't know what Apple's vendor pricing is, but I'm absolutely certain that the upcharge from a 16 GB flash chip to a 32 GB or to a 64 GB isn't anywhere near $100 per jump. Depending on unit volume of the various configurations, the larger chips could conceivably be cheaper to Apple. The A7 chip increases the ability of the device to handle resources like graphical textures, photographs, and audio; the more resources it can process, the more resources will get loaded onto the device and the more space consumers will need to store those resources.

    The more powerful chip will ultimately lead to bigger apps, and that'll make you want to buy the 64 GB iPhone 5S for $399 (with two year contract) instead of the 16 GB version at $199.

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