iPhone are in practice more reliant on central servers than ever before. Except for some games, if you take a random person's iPhone it becomes almost useless without internet connection. Which is exactly my point, it's not about compute, it's about people's expecations and priorities. The main driver of the need for higher performance chips on iPhones is its camera and smooth 120fps UI animations, not local processing for apps for almost all people.

However, the compute situation just skew it even further when it comes to LLMs.

Phones are communication devices. So I would always expect connectivity to be central to their use. But that's a different issue than the "inefficiency" of edge computation and whether powerful edge devices can sell (they obviously can).