The new iPhone 5S and 5C have just been released and we’re already deluged with opinion on whether the price is too high, whether the colours are better, why they should have released a watch, and why we should care about a 64-bit processor.

That’s all very well and we all love debating our smartphones. But I think the persistent (and surprisingly accurate) rumours have prevented us from realising that Apple’s M7 motion co-processor has quietly kicked off a revolution in how we use mobile devices, though we may need a little patience.

All About Ecosystems

Apple’s strength lies in its highly integrated ecosystems in the shape of iTunes and the App Store, because these provide a massive revenue stream for each device sold which continues for as long as the device remains in use. While hardware manufacturers such as Samsung and HTC are paid when the customer buys the phone, Apple receives revenue every time a purchase is made through its ecosystems, and this continues when the phone itself is passed on to another user.

Where other manufacturers might feel a penalty from building a device to last: they need to spend more on R&D and quality control; they then need to invest further in R&D to make a major step forward for the user to want next year’s model because they won’t have the motivation of a rapidly deteriorating user experience, Apple does not.

This is the pain felt by Motorola and Nokia, which have both tied more closely to their ecosystem providers, as well as Samsung which is trying to build its own ecosystem in the shape of Tizen. If the owner of an Apple device buys a new one and passes the old one on to a relative, who then continues to buy apps and music, the revenue stream continues. This is also part of the reason why Apple continues to support older devices with OS updates longer than other manufacturers.

How To Stay At The Top

However, it cannot be disputed that Apple is able to make this model work by focusing on a very premium market sector, and that premium sector will only remain if they continue to believe they have the best device on the market. Therefore, the challenge of being at the top becomes how to stay there, which requires error-free updates (an area where Apple has stumbled), and the ability to continue to excite consumers with new releases.

The Challenge Facing Apple

We are entering an era where smartphone specifications don’t really need to improve: there is so little difference between processors or screen resolutions, at least, so little that we can detect, that the main difference with high specs is that the battery doesn’t last as long. Better battery life would certainly be welcome and would tempt a majority of smartphone users, but it seems that with current battery technology it just isn’t economically feasible to do so.

Instead of radical new technologies, Apple prefers to take an existing technology and make it work better or in a more useful way, just as it did with the 3G capability of the 3GS, retina screen in the 4, and the improved GPS of the 4S. This may only appear to be incremental, evolutionary change, but outside the early adopter technology world this is a very effective way to convince consumers to use the feature.

64-Bit: That’s Exciting, Right?

This year, the glimpse of the future we have been offered comes from the new processor and specifically its motion co-processor (essentially a chip that keeps an eye on the internal compass, gyroscope and accelerometer at all times). There could be some interesting uses for the 64-bit processor architecture in the future, but I don’t see this becoming as significant a change.

At the moment, the 64-bit processor barely uses any of its capability. The technology could allow greater speeds, support for desktop applications (or support for a future merging of mobile and desktop), support for more than 4GB of memory (theoretically up to 16 exabytes, which in technical terms is “a lot” since an exabyte is a billion gigabytes), where the iPhone currently has 1GB of memory.

However, it is limited by the rest of the hardware (such as the rumoured lack of extra in/out bandwidth to the A7 processor, meaning it cannot actually transfer data any faster) and beyond some speed and security improvements from the ARMv8 registers, the current generation of phones simply won’t benefit much from having the new chip.

Fingerprint Reading With The iPhone 5S

So is it just a marketing gimmick? It allows Apple to say that it produces the fastest smartphone on the market, and will make Samsung’s next Galaxy look like it’s playing catch-up again. It is believed that the development of 64-bit chips by Qualcomm, Intel, Nvidia and the like means that the competition is about nine to twelve months behind; in other words, if Apple waited until its next launch, it would not have looked so impressive.

There is also the argument that it is not making performance worse, and if it prepares the ground for further 64-bit uses by encouraging app development, that’s a good thing for Apple. Arguably, while Apple doesn’t care too much about specifications it knows its competitors, analysts and much of the market do, so by raising the bar on what can be considered “good” Apple is forcing its competitors to invest, thus weakening their already-tiny margins. But probably the biggest argument in favour of it being a stunt is the phone it has been released in: the 5S, which is the mid-life refresh to keep up sales.

Indoor Navigation, Payments And Mobile Big Data

The big story is the M7 motion co-processor, an always-on component that continually measures the phone’s motion while drawing very little power. Since this has access to all the phone’s location and movement services it is able to triangulate location rapidly and efficiently, and is the iPhone 5S’ real game-changer.

The motion co-processor currently works with sports and activity tracker apps, but the really interesting part of the technology is its application for indoor navigation via Bluetooth Beacons. These are small Bluetooth devices that can be placed anywhere, and which can pinpoint a user’s location by triangulating between themselves and the user’s device, for very low cost.

There are still several potential exploitations of this technology under development including iBeacons and Navisense, and it may well be that Apple is waiting for the technology to mature before making it a front-and-centre part of the iPhone.

Mobile Shopping Just Got Easier

The concept is that for a very low price, shops, sports arenas, museums, even public transport systems could place a few beacons and have very accurate triangulation of a user. In concert with the profiles available via mobile Big Data this could be used to generate very accurate promotions, as well as allowing users to use contextual search to locate items or areas they are interested in.

This becomes even more interesting when combined with the fingerprint sensor now built into the iPhone’s Home button. Apple’s ability to develop a product ecosystem will help organisations (especially financial services and retailers) to develop apps that allow the user to scan items and pay for them automatically without having to enter any codes, numbers, passwords or queue for a checkout. Since the phone recognises the user’s fingerprint this has the potential to become a far more secure solution than NFC, or even swipe cards for secure access to buildings.

A phone that knows where you are, can direct you wherever you’re going, and which provides a secure, authenticated purchasing capability? That could be a game-changer.