The Nerdy Joys of the Macbook Neo | Sharp Tech with Ben Thompson

Not a critique of the Neo. I think the Neo is amazing. Like and I think it's it's quite exciting just in a I mean cool to see Apple doing a new strategy. Like like the 17E start or the 16E started it. But for ages their low-end computers would just sell old iPhones and keep them around forever. Now to see them actually designing for the low-end. And to look at the Neo and to see how cheap it is, how capable it is.

The teardown videos are cool. It's totally the old computers. Everything can be is modular and like screwed in. There's no like you take a part of modern Apple devices. It's all like glue and stuck together. And that's how you get it thin with long battery life. Oh, that's the other thing. The Air has better battery life. That is a like for one that I leave in my car and I can plug it in in the car, but I want it to always be working.

Of the Neo that I made me pause and say, all right, this probably isn't for me because it battery life does matter to me particularly if it's a laptop laptop that I'm carrying all over the house the whole time. Right, which I don't always remember to plug in and it's like basically the Air like I plug it in. I use it right now. I'm looking at our I use it for as my computer to look at our rundown while we're recording and it's plugged in right now and this is the only time I'll have it plugged in all week. Like the rest of the time it's just sort of like it's around and it it's totally fine. So so yeah.

Was very tongue-in-cheek saying I wasn't a target customer. I think it's an amazing computer. I'm just not in the buying it because it's cheap stage of my life anymore.

$499 for education. And a really good laptop at that price which is pretty unbelievable. What it does have going for it is color. Color is good Apple. We like color. It drives me bonkers that color was always for the cheap stuff and not for the expensive stuff. I would you know they do have it with the iPhone Air to an extent, but you know, it's an amazing computer. It's awesome. We've been waiting for like the iPhone chip computer and it's it's great that Apple shipped it. And I do think Rav raises a really important point. There is was a lot of muttering in this about oh, Apple got caught out by the memory prices. This is how out of sort of out of touch they are. All evidence is that no, Apple is still fully in control of their supply chain. They understand what they're doing and the proof is in the pudding. They like now these chips only have 8 GB of RAM which certainly helps. And by the way, most of these chips or a lot of these chips were made last year. I mean the Apple's management of their supply chain it's this is so brilliant. So I don't like the iPhone so what's amazing about this chip is number one, it's the what is the They they got to clean up their numbering. I'm glad for the OS's they're now doing them by year like Mac OS 26, Mac OS 27. They need to fix this chip issue. What is it A19 at this point or something like that?

Okay, so Apple always had this orphan chip or not always. The last couple years it's had this orphan chip which is the chip they make for the iPhone Pro. A couple So it always used to be the regular iPhone and the iPhone Pro had the same chip. A couple years ago they they split it and they I think it was with the A16. They sold the A16 the regular iPhone two years in a row. They made an A17 Pro. And the big difference is more RAM and more cache. So cache is like RAM on steroids. So there's a thing called a memory architecture. So the the most immediate memory that where they actually do the calculations on is called registers. Then below that there's like super duper fast memory that's like into the chip that's called L1 cache. Then there's L2 cache and then sometimes there's L3 cache. L like level one, level two, level three. And then you go to RAM and then you go to the hard drive, okay? So in every Now all these are like insanely fast, but relatively speaking there's drastic differences in speed. So it's like you know, it's like the if you're doing an equivalent, it's like going to reaching something on my desk, getting up and going to my closet, going to my garage. By the time you get to RAM, it's like my parents are fairly nearby. It's like I'm getting in the car and going to my parents to get something and coming back. And then going to the hard drive is like I'm driving across town. Like so like the and there's these massive differences in speed. So the Pro chips added significantly more cache on the chip which really like it just speeds it makes everything feel faster. And and you see this memory and bandwidth. The way to get faster bandwidth and to get just much lower latency. There's trade-off to latency bandwidth. But but to get lower latency is to have more memory closer to where it's being used. So this is one of the reasons why the but because this L1, L2, L3 cache goes on the chip itself which means you have to make a larger chip. So the the cost of making of getting this performance improvement is fairly significant because you have to make a larger chip. Now the way chips are priced by TSMC is they sell per wafer. So these are 300 mm wafers and they and you can make one chip on the whole wafer. That's what Cerebras does. And the reason why a Cerebras AI chip is so fast is the what where are they using all that wafer space for? Memory. SRAM. They beat it right on there. There's something that Groq was doing as well that they acquired. We'll probably maybe talk about that more next week cuz Nvidia's GTC is next week. So you you have So but the larger the chip is on the wafer, the fewer chips on the wafer which means your price per chip is higher because there's that's number one. Number two, the larger your chip, the higher the likelihood there's a defect that hits that chip. And then you have to throw the chip away which increases your your overall cost as well. So basically there's a very direct link between size of chip and the cost of the chip. And that size it's not it's not a linear increase because that yield issue. So it gets significantly more expensive the larger it gets.

Right. So what you would get So what you would get with the with a Pro chip versus the regular chip is I think I I should have the numbers in front of me. Sometimes they add more cores or more GPUs, but also they add more this cache which really that really improves performance to a significant to a significant amount. So they they So they have basically two iPhone chips. Now the older chip is smaller and you fit more on a wafer and you have better yield because it's smaller. So those are the chips that they would sell for years and years with the old with the old strategy where you would come out with the iPhone 14. Then you would the next year decrease by 100, next year decrease by 100, decrease by 100. And then you'd be be using that chip for a long time. And so you would set up that that run to make chips and you would make a bunch of chips and you could use that for a long time. They had this weird situation though with the Pro chips which they had with the Pro phones. They only make the Pro phones for one year. So and this is actually I didn't really appreciate this until I was giving someone one of my old Pros. And I like you know buy an old Pro at this point. Is that right? Well, no no, you can't buy an old Pro. You can't buy an old case for a Pro. I'm like this case is like totally tattered and I'm going to buy them a new case. I couldn't find a case. Like I I found one eventually to like because it who's going to sell a case for an old phone, right? It which doesn't isn't sold anymore. But the issue is Apple has to make chips for these phones. And then once they've made chips, where are they going to they're going to make more chips than phones that they sell. Yeah. They didn't use them anywhere else. For a while Particularly these Pro chips. Because even the the iPads would use sort of the M1 chip. Now I think some of the low-end I I can't remember the iPads, but they have this leftover issue. So what they've done with the Neo is very clever. So number one, the Neo does not have the newest Pro chip. It has last year's Pro chip. So they get to use those leftovers, but also the Neo specification is for five GPUs. The iPhone 18 Pro has six GPUs. Okay. So what is what happens is they're doing binning. We've talked about binning before, but a GPU is fairly takes up a fair amount of space on this die. So if one you have a larger chip, if you have an issue with one of the GPUs you had to throw the chip away because it was supposed to have six GPUs. Well, what Apple did last year is all all the ones that have a bad GPU. Set them aside and suddenly and so I said this sort of jokingly but it's kind of true. MacBook Neo chips are free because it's like they're going to throw it away otherwise. And so if they actually the MacBook Neo is decreasing Apple's costs of last year's iPhone Pro. Now I don't know if you Now I don't know how they actually accounted for that. But because they're basically increasing the yield from these lines. They're utilizing the lines for longer so the design work that goes into making these chips is also being leveraged across more computers. And it's just a very and like again to sort of Felipe's point who actually needs that level of graphical performance. And by the way the graphical performance is still pretty good. Right? That's that's just how good these chips are. So this is it's there's a lot of things that are interesting about the Neo. I think Apple designing for the low end is really interesting as opposed to just trying to preserve these old ones. It's a definite shift in philosophy but it's also it's still Apple at its most clever as far as managing the supply chain and spreading out the costs of designing and and doing binning and all these sorts of things to to deliver this computer. It's it's it's it's I mean as a nerd it's very cool. Is Apple better at operations than anyone in tech is better at anything? Yeah that's good. Maybe true. I mean it is amazing right? Like in the and and so yeah but not just that so the iPhone or the MacBook Air did increase in price. I think that maybe a recognition of the increased cost