It is – in fact – these chip making capabilities, which [Steve Jobs] brought in-house shortly after the launch of the original iPhone, that have helped Apple create a massive moat between itself and an entire industry.
Ultimately this chip advantage is one of the little spoken, but critical elements in Apple’s vertically integrated approach. Android OEMs can copy the fingerprint sensor or the 3D Touch mechanism. They just go to the supplier that Apple buys it from. But they can’t copy the underlying software powering these ‘commodity’ chips.
With each generation, Apple’s products get closer to feeling like a singular element, with software and hardware crafted together. Every time the integration feels as tight as it’s going to get, they raise the bar. It’s uncanny, in the best possible sense of the term.
Update: As John Gruber notes, calling this “insurmountable” is an overstatement. It’s a huge, category-defining advantage, but not something impossible to chase.