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Apple (NASDAQ:AAPL) has not failed to impress with its A6 system-on-chip in its latest iPhone 5. A couple of days ago, it was revealed that Apple took its chip design to the next level by actually designing its own custom ARM-compatible (NASDAQ:ARMH) cores rather than using off-the-shelf ARM designs as it has done in the past. This level of customization gives Apple much more control over the performance and power consumption profile of the chip for the intended workloads.

According to Anandtech, the Apple A6 is 2.13x faster than the iPhone 4S on average. While this in itself is a nontrivial improvement, the more shocking point is that in both CPU power as well as GPU power, the latest Apple chip leaves competition from Nvidia (NASDAQ:NVDA), Qualcomm (NASDAQ:QCOM), Intel (NASDAQ:INTC), and Samsung (OTC:SSNLF) in the dust.

Graphics: A Very Significant Lead

According to the Anandtech benchmarks, the graphics processor in the Apple A6 system-on-chip is just as fast as the graphics available in the latest iPad. More importantly, none of the other graphics chips in currently shipping competing solutions even comes close to matching Apple's performance.

This is extremely significant. First and foremost, this will be yet another reason that game developers will be attracted to the Apple platform over Google's (NASDAQ:GOOG) Android platform or even Microsoft's (NASDAQ:MSFT) Windows Phone 8. With developer support stemming from both a fairly closed ecosystem (making it easier for developers) as well as class-leading graphics hardware, phone buyers will be particularly attracted to the notion of high quality mobile gaming unavailable on any of the other platforms.

Interestingly enough, Apple didn't even design its own graphics chip here, but it was smart enough to use the latest-and-greatest from Imagination Technologies and not treat graphics as a second-class citizen. Other system-on-chip vendors need to start caring about graphics performance since gaming is a non-trivial addition to the "user experience."

In-House CPU Design Is World-Beating

The CPU portion of the Apple A6 looks modest on the surface: a 1GHz dual core chip. With "quad core" phones using the Nvidia Tegra 3 and Samsung Exynos, one would initially be led to believe that Apple's CPU performance is trailing and not leading-edge. And they would be dead wrong.

Apple's dual-core 1GHz design is highly efficient and is optimized to get as much work done per clock-cycle as possible, and its performance speaks volumes. In BrowserMark, SunSpider, and Google's Octane and V8 benchmarks, Apple's custom CPU cores prove to be faster core-for-core and clock-for-clock than even Qualcomm's Snapdragon S4, the previous mobile CPU champion. Don't be fooled by "gigahertz" and "core counts," as these metrics do not tell the full story.

Competition: Time To Really Push

Apple's leap-frogging of the entirety of the smartphone system-on-chip industry is something that all of the players should take serious notice of. Apple's first attempt at its own CPU design has been a rousing success, and the dedicated chip players will need to really push hard if they are to enable performance on competing smartphone platforms that are comparable to or even exceed what Apple's now provides

Qualcomm is fine because its dual-core Snapdragon S4, within a similar power envelope to the Apple A6, is able to keep up with the A6 on the CPU side (and the quad-core iteration in a similar power envelope will be significantly faster). The higher-end Snapdragon S4 Pro is faster than the Apple A6 on the CPU front and competitive on the graphics front.

Nvidia needs to get its ARM Cortex A15 based designs with an updated graphics processor sooner than later. As a company whose core competency is graphics, it is embarrassing that Imagination Technologies, with its much more limited resources, is able to essentially dominate the field.

Intel is in a very tough spot right now. While its "Medfield" chips based on a four-year-old micro-architecture are actually competitive with (but slower than) Qualcomm's dual core Snapdragon S4 in a number of tests, its next generation "Merrifield" needs to absolutely "wow" on a performance/watt basis. And by "wow", I mean, it can't afford to be #2 in any metric: CPU performance, GPU performance, or battery life. Intel needs to offer a fundamentally better piece of silicon than anybody else if it is to be taken seriously in the low-power space.

Conclusion

Apple has really outdone itself here. It owns its own software/operating system, its own retail stores, and is now succeeding against giants in the semiconductor space at their own game. Only Qualcomm has a competitive solution at the moment, and it's starting to look increasingly likely that for non-Apple devices Qualcomm will be the vendor of choice for quite some time.

Source: Apple's iPhone 5 Chip Design Seriously Impresses - Is The Competition Asleep?