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USB-C confirmed for the iPhone 15 in new leaked images - Macworld
(www.macworld.com)
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You're 100% right.
The 12" MacBook had a great form factor right at the time that Intel CPUs really started to struggle with performance at lower power consumption, so the design turned into a huge weakness for thermal management. If they had similar performance per watt as the base M1 later showed off, that device would've been perfect for an ultraportable laptop, the spiritual successor to the discontinued 11" MacBook Air.