Please agree to our privacy policy to enable news listening. (Central News Agency, San Francisco, comprehensive foreign news report on the 18th) The Wall Street Journal reported that while most electronic device manufacturers are being hit hard by rising costs, Apple in the United States has been able to launch low-priced new products such as MacBook Neo and iPhone 17e to grab the market, relying on the reuse of defective chips that have been used for many years. The report pointed out that Apple (Apple) has long been admired by consumers for its high-end price products, but its new entry-level notebook computer MacBook Neo is priced at only US$599 (approximately NT$18,900), and preliminary sales data show that this product is very popular. Although the MacBook Neo is equipped with Apple’s A18 Pro chip, which is the same chip as Apple’s high-end smartphone iPhone 16 Pro launched in 2024, it has been reduced from 6 cores to 5 cores. The Wall Street Journal said that this shows that Apple can retain some A18 Pro chips with a defective core for future use, because the defective core can be deactivated, and then such chips can be used in other lower-priced devices and still work very well. In fact, Apple is using the chip industry’s approach of finding ways to squeeze profits from less efficient processors, by binning its supply into “good”, “better” and “best” products, similar to how it sells eggs, gasoline, diamonds or hotel rooms. Analysts pointed out that this industry strategy, which has been in place for decades, was originally just to make the best use of chips, but now it has become the basis of Apple’s product line design strategy, allowing it to be accurately segmented to achieve effects that smaller rivals cannot match. In addition to using the flexibility of self-developed chips to launch lower-priced iPhones and Macs, Apple also leverages its strong supply chain advantages to reuse chips to engage in price wars and attract new users. The MacBook Neo, for example, is cheap enough to poach consumers who might otherwise buy a Google Chromebook or other desktop computer (PC). The iPhone 17e is also equipped with a “graded” chip and is cheap enough to attract users who originally used phones equipped with Google’s Android operating system. Market research companies Counterpoint and International Data Corporation (IDC) both said that due to the sharp increase in the price of memory and storage devices, it has become unprofitable for Apple’s competitors to sell lower-end products. On the other hand, Apple has an advantage in comparison and can seize the market by launching lower-priced products. Tim Culpan, a supply chain analyst who has written an article analyzing MacBook Neo chip orders, said: “If you can continue to use things that are not up to the highest specifications, in addition to saving time, money and reducing waste, you can also sell them to many customers that you might not otherwise be able to reach.” As long as Apple adds new users to its device products, it may add buyers for its services such as cloud storage iCloud and the App Store, and this type of business is also more profitable. The Wall Street Journal analyzed nearly 200 pages of Apple filings and found that since 2021, six versions of Apple’s A-series chips have been used in lower-priced devices with one less core count, while full-core versions were initially installed in higher-priced iPhones. However, people familiar with Apple’s supply chain revealed that the MacBook Neo is now so popular that even the remaining chips that were originally reused are running out, forcing Apple to place an order for the new A18 Pro in the near future. However, because Apple has only one supplier of its most advanced chips, TSMC, and TSMC is struggling to cope with the crazy demand for artificial intelligence (AI) chips. Therefore, as Ming-Chi Kuo, an analyst at Tianfeng International Securities in Hong Kong, said: “Apple no longer enjoys the (supply) flexibility it had in the past, and pressure is beginning to appear.” (Compiled by Zhang Zhengqian) ) 1150518 Support the Central News Agency’s choice to stand with the facts. Every donation you make is a small amount of sponsorship to download the Central News Agency’s “First-hand News” APP to get the latest news in real time. The text, pictures, and audio and video on this website may not be reproduced, publicly broadcast, or publicly transmitted and used without authorization.
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The Wall Street Journal reveals Apple’s profit-making techniques by using graded chips to push low-priced products to grab the market | International | Central News Agency CNA
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