One impressive task that Apple showed off in its iPhone 12 announcement was the iPhone 12 Pro’s ability to shoot and edit 4K, HDR video at 60 frames per second (fps). As many tech reviewers have noted, this makes the iPhone 12 Pro faster at this particular task than most top of the line Intel computers, regardless of operating system. This is a fantastic feature to have on a phone, but what percentage of iPhone users will ever want to shoot or edit 4K HDR videos on their iPhone? A very small percentage, one very, very close to zero. The question arises, then, as to why Apple was so insistent on emphasizing two things in this presentation: 1) the astonishing computing power of this device and 2) it’s support for all variants of 5G communication. Apple did this because the iPhone platform is destined for much bigger, bigger tasks than simply performing the mundane tasks that 99.9% of its user base performs. The iPhone is destined to be the mobile computing platform of future devices like autonomous vehicles.
Apple has a spectacularly huge set of data that tells Apple exactly what iPhone users do with the iPhones and how frequently. Apple knows that a truly insignificant percentage of its users ever bother editing their HD videos on their phones. Apple also knows that the only consumers who will benefit from the speeds of 5G connectivity are those who will use this pipeline to connect their computers to the internet. With the exception of downloading large files like movies and apps, users will not notice any difference between the speeds of 4G LTE connections and a 5G connections. Email will be received as quickly, web pages will load as quickly and movies will stream instantly. Massive computing power and high-throughput, low latency, and reliable 5G connectivity are the two critical elements that autonomous vehicles need. These elements will enhance the average consumer’s experience, to be sure, but this device is targeted at mobile computing applications that are about to be deployed in a very, very big way.
It is no secret that Apple invested significantly in developing its own autonomous vehicle platform, but eventually downsized the effort dramatically for reasons that remain speculative, at best. The decision that Apple seems to have made is to build a computing platform that all mobile platforms need. Why make your own autonomous vehicle when you can make a computing platform that all autonomous vehicles could use, whether it’s Tesla, GM, Ford or BMW?
This decision was likely based on all the data they culled from the Apple Carplay experiment of the past 10 years. More important than how users prefer to use the Apple Carplay was the data that Apple collected on how a mobile device must interface with a car, how the connection can be made reliable and, ultimately, what parameter space Apple needs to perfect in order to be the best computing platform for an autonomous vehicle. This has been the primary driver behind Apple’s unrelenting effort to make the most secure, the most reliable, the most connected and the most powerful mobile computing platform. This is why Apple settled its dispute with Qualcomm over 5G antennas for a hefty sum and why it purchased Intel’s 5G antenna project. This is how important a piece of the puzzle 5G is for mobile computing and autonomous vehicles!
Now Apple can make a very, very attractive value proposition to car makers: why bother making your own hardware when half the country has a powerful enough computer in their pockets? Developing computing hardware is expensive, and car manuacturers are ultimately better off developing proprietary software than proprietary hardware. By selling over 200 million iPhones per year, Apple can innovate hardware extremely rapidly. Global car sales for 2020 are projected to be only about 62 million vehicles. This is not a large enough volume for an industry that is more concerned with improving vehicle safety, engine efficiency and razor thin margins to innovate computing hardware! Apple can, therefore, tell car manufacturers that it makes more sense for them simply to optimize their autonomous vehicle software on Apple’s hardware. Automakers can forego the expense of designing computer chips, dealing with fabs like TSMC to manufacture the chips, and to run an operation in which the software division is constantly optimizing its software to the hardware division’s specs. The car manufacturer simply optimizes its software to Apple’s hardware specs.
This is an exceptionally tantalizing offer for the auto manufacturer because even a massive union of the most massive auto conglomerates, like BMW and Mercedes, does not have the wherewithal to compete with the powerful computing platforms that Apple churns out daily. If you remain unconvinced, witness Tesla’s decision to use AMD’s computing platform because hardware development is way too expensive for Tesla’s current puny output of a few hundred thousand vehicles per year.
This evidence remains circumstantial, of course, but it is undeniable that automakers are better off using the best computing hardware on the market than developing their own. The question then becomes whose hardware they should use. Apple is making an overwhelming case for why its iPhone platform is the best. It is closed and, therefore, most secure. It is the most efficient because Apple’s control of both hardware and software gives it more opportunity to optimize the two to each other than anyone else. Perhaps most importantly, auto manufacturers have to deal with only one party to optimize their software: Apple. Any manufacturer that is contemplating using the Android platform has to deal with multiple parties: Qualcomm and the other hardware manufacturers, Google, which makes the Android OS, and the inegrator, be it LG, Samsung or Sony. Apple has exquisitely exploited this rift in the Android market to its advantage, but with respect to mobile computing for mission critical applications like autonomous vehicles, Apple is about to make a case than nobody else can make. Apple’s coup de grace may be that its platform is also the most energy efficient: an inefficient computer could actually reduce the range of the electric vehicle!
Computing is about to make a huge leap into aspects of life we never thought imaginable. A battle royale among the computing titans is afoot. Invest wisely.
Disclosure: I own stock in both Apple and AMD, and, indeed, I am bullish on both.