..but in a good way. I did not know they have found a way to use slightly defective chips to produce 2nd tier, but first rate products, like the cheap Neo laptop.
Apple Is Making Hit Products and High Profits From Imperfect Chips
Apple Is Making Hit Products and High Profits from Imperfect Chips
The company’s popular, $599 Neo laptop is just one of dozens of Apple devices that use lower-performing processors
[Apple], long revered for its premium-priced products, has managed to develop a booming business selling cheaper devices when most gadget makers are being hammered by rising costs.One of its secrets: using chips with slight defects that might otherwise be thrown out.
The strategy is apparent in the technical minutiae of the newly released[$599 MacBook Neo], which early data suggest is a hit with customers.
The chip powering the Neo is Apple’s A18 Pro, the same chip first used inside the iPhone 16 Pro two years ago, but with one key difference. The Neo version of the chip has a “5-core” graphics processor, one less than the version inside the 2024 iPhones, indicating that Apple was able to save some of the A18 Pro chips with a defective core for future use.
Defective cores can be disabled, leaving a chip that still functions perfectly well to power different, often cheaper devices—in this case an entry-level laptop instead of a top-of-the-line iPhone.
It is the latest example of Apple deploying a decades-old chip industry strategy to squeeze profits from lesser-performing processors by selling them like eggs, gas, diamonds or hotel rooms, segmented by good, better and best
I knew there was a way to permanently disable certain parts of a defective chip so it could still be used, but I didn’t realize there was an entire strategy of doing so and managing to turn the 2nd tier chips into a first tier product.
Apple is uniquely positioned to do this now that they design their own chips. When they were contracting from Intel or others, they took what Intel sold; now they have the entire production run, and it looks as though they are able to find uses for (roughly) 20% of a production run which formerly would have been consigned to the waste pile.
https://www.wsj.com/tech/apple-is-making-hit-products-and-high-profits-from-imperfect-chips-d32c21d8
