Apple’s Social Network
stratechery.com
stratechery.com
I was recently taken aback by the amount of money I was paying for high-quality subscriptions “oh my god, I’ve paid $20/month for the last 12 months to subscribe to high quality streaming to Phish concerts via their app?!?” I signed up for it thinking I would only do it for a month. I forgot. I spent $240 on Phish audio, more than I spent on my Apple Watch. Apple’s real social network could be just getting started. Imagine if those “luxury” expenses were intermixed with a dozen other large, more legitimate bills? Apple could be processing $1000s a month per household, taking a hefty fee from some of them. And then launch a loyalty program :).
If I had to guess, I’d say this comment resembles Buffet’s view of Apple’s opportunity.
Isn't that far easier to set up scheduled payments with your bank or allow the company to use direct withdrawal?
I also disabled autopay for similar reasons. This helped me notice that Comcast had started charging me for a TV tuner that I didn’t have (I don’t have their television service, only internet). It took three months and multiple calls to get that resolved and credited. I might not have remembered to follow-up if I didn’t have to look at the bill each time.
That’s what we have in America. Internet run by a couple of mafia like companies who have the government wrapped under their fingers.
Yes I would very much love if Apple threw a couple of billions and shook the internet pipes.
I bought a new cable modem to take advantage of the higher tier data rate, so I'm not actually ahead of things yet, cost-wise, but another couple of months will do it.
I think we need that monthly payment friction to pressure companies to keep up their value proposition to customers. If I have to continually re-choose to be a customer, the company has to do more to keep me satisfied.
This costs me about an hour a month, which I spend noticing the bills I pay rather than paying them by hand.
While I strongly agree with your top-level comment, and I think Apple's brand is very valuable, a lot of that is from a trustworthy, privacy standpoint. Small nitpick, but I think on the "data gold mines" point, any area where collecting data is paramount is an area that Apple should not enter to maintain that brand value (i.e. their Maps not collecting data as much as Google's is a real pitfall).
The areas you listed above are largely possible without collecting that much data, which may be the exact reason Apple should pursue them. :)
One of the draw back of the current solution for IoT is connecting different eco systems, such as GE light bulb to Amazon Echo. If apple have a solution that is elegant and 'just works', i'd be interested in that
There were early complaints that Apple was making too many demands on manufacturers with regards to security, but given the utter shitshow that is IoT these days, it sure seems like it was a good idea.
Apple could have killed it in this space. The development costs would have been relatively low, and there was a wide-open goal with the possibility of much-improved security and privacy, high quality industrial design, AI, and yet more links to Apple devices, as well as providing a home network foundation for future products such as health monitoring devices.
Instead Apple handed the market over to 3rd parties and... not much of interest happened with HomeKit.
I do concede your point that greater centralization isn’t really in the consumer’s best interest. I stand by my point that it could be on apple’s radar for ways to continue growth, in its best interest. My parent comment is not a consumer wishlist but that of a (rookie) investor.
That's what we need-- another middle man taking a even more off the top of every transaction.
Are you saying that the current system of having a checking/saving account, and setting up autopay/direct payments for your various bills (mortgage, utilities, gym, etc.) is cumbersome?
And proposing that instead, Apple should add up all your bills and provide you with a $amount to pay each month, and you just pay that amount into your Apple checking account?
The example you gave above, overpaying for a music subscription because it didn't auto cancel, wouldn't be solved by this system, Apple would just add it into the bill and if anything, reduce your visibility into what you're paying for and why. I'm not sure how they would know to "protect" you from a music streaming service you signed up for.
The method that works best for me is to use an app like Personal Capital/Mint to centralize financial info and get notifications on what I'm paying for, and when. It also summarizes what buckets you are spending into, so if any look odd you can dig down and investigate further.
This is my nightmare of where the subscription-culture is headed.
If they just built their own search engine and used it as default, and it provided high quality un-manipulated results, I think even more would flock to Apple. Yes they'd take a (big) hit up front by losing out on all of that free Google money (estimated to be ~$12B in 2019), but then they could actually say with a straight face they were truly privacy advocates and won't sell their users data to Google via the Google Search Engine.
Saying how privacy conscious a company is, while literally making billions of dollars by indirectly selling a lot of their customers data, really rings hollow with me. Build a search engine. It's not as hard as building Apple Maps, and will do more good in many ways. Hell, even non-Apple people might use Apple search and fall in love with the results, bringing them into the Apple fold.
Apple to some extent launders responsibility for extremely useful services that require or use personal data by outsourcing it to others.
Why not actually turn iMessage into a privacy preserving social network?
For the same reason, as with search, I think the difficulty is underestimated.
Based on the series of frustrating searches I did in iTunes last night, Apple either isn't working on this at all, or isn't using iTunes as a testbed.
Apple is not a small startup anymore, it can not even replicate DDG
But why? It greatly puzzles me how many "consumers" now think in terms of "brands" and dream up and discuss strategies on behalf of them. Companies should concentrate on fleecing customers, and customers should concentrate on not getting fleeced.
but in most cases, these musings are forms of armchair quarterbacking, not some brainwashed adoration of a brand.
This mentality is a problem. Companies have many valid motivations, and certainly profit is one, but long-term success is rarely predicated on gouging customers.
How is that a "mentality"? How is it a problem?
> but long-term success is rarely predicated on gouging customers
It being predicated by gouging is not a claim of mine, success being accompanied by gouging it is enough. Would you say fleecing customers is "rare"?
Razor blades, Inkjet cartridges, sunglasses, broadband internet/telecom, most luxury goods, payday loans, the entire diamond industry
Most of us spend our day fleecing and then go home to be on the receiving end. If thats the terminology you want to use for the production/consumption cycle.
There's nothing that says one has to be wearing their consumer hat when using hacker news. In fact given the context of both the forum and article, it makes far more sense to me that people would be commenting as fellow fleecers not the fleeced.
Hacker news in general has more content relevant to fleecing rather than being fleeced. This article being a prime example.
As a consumer its of zero interest to me. What do I care of iPhones growth or lack of it? Reading about Apples market position and growth options only appeals to me as a producer.
Yet another poster berated me for considering it anything but rare... what gives?
At any rate, fleecing, exploitation and deception of all kinds are externalizations of costs that will always bite the groups and individuals who do it in some form, and the ecosystems that choke on it.
> here's nothing that says one has to be wearing their consumer hat when using hacker news.
Is there something that says you aren't allowed to wear it? I mean, the comment I was responded too sure is be written from that perspective. And as you say, everybody is also a customer. So why not always be in mind of that, why not refrain from fleecing people simply because you don't want to be fleeced? These hats aren't actual hats, they don't actually make you different persons.
A matter of perspective on how you see the modern economy I guess. Fleecing generally means some kind of fraud or poor trade. When you used it to describe Apple just hypothetically moving in to a new market (without any fraud being mentioned) and then backed it up with a statement about how that's just the natural way of things, I took it as a criticism of the market as a whole. That the provision of new products and services is an overall fleece as it doesn't really improve the human condition. Just a general comment on consumerism.
So because I see just economic activity as a whole as one big fleecing, I consider fleecing to just be what we all do for our 9-5. I call people up and tell them about software they don't have. You make software it is you do and then people find it some other way or whatever else it is you do. Apple is charging more for phones than they did last year making them less attainable or whatever it is they do. It's all part of the same game. Making people feel bad about their current situation by either showing or creating a better one.
Other guy almost certainly doesn't agree with that. I don't know where you stand. I mean, as far as things go Apple moving in to billing/banking doesn't seem particularly evil. It's a "problem" a great many people face that could do with some "it just works" design. At least in the US by the sounds of it. So if you're against that it makes me think you align somewhat with me. However if you think it's possible to exist in society and not fleece then probably not!
>will always bite the groups and individuals who do it in some form, and the ecosystems that choke on it
Absolutely! My opinion of society as it is now or its future are not high! We're creating new needs and standards for others to live up to in order to meet the new needs and standards created by others. A circular flow of hustle where the steps we take power the very machine we're on! That's a huge negative externality.
>Is there something that says you aren't allowed to wear it?
No, I just took your question as a challenge to that way of action as much as a genuine question, just because of the context of it. The comments section of an article discussing business strategy, on a forum filled with business owners and aspiring business owners, ran by an investment firm. It's fleecer central.
>So why not be in mind of that why not refrain from fleecing people simply because you don't want to be fleeced?
Because there are core things I want, that if not biological which I suspect they are, are so deeply ingrained from whatever other source that they might as well be biological anyway. I can't attain those thing by not playing the game. I can't be a forest hermit and also be a well respected big deal with plenty of access to pretty women. I need to produce great economic gains and capture tons for myself, because that's what everyone else is doing. That's the standard to meet. Awareness that you're playing a prisoner's dilemma game doesn't do anything to change the outcome if you can't organise with and trust the other players to agree to outcomes. It can be hard to pull off with only two people,. It's certainly not going to happen with 7.53 billion.
Me abstaining wont change the world to any noticeable degree while condemning myself to a less content life than I already am.
[..]
> So because I see just economic activity as a whole as one big fleecing, I consider fleecing to just be what we all do for our 9-5
Wait, clearly moving into a new market is economic activity, all economic activity is fleecing in your outlook, yet there is a problem with me being "critical" because there is no fraud being mentioned? Yet you say it's all fraud, so according to you it's clearly implied.
I mostly took it as implied greed, the inability to "leave money on the table". That's not what most people do, that's not what all economic activity is, if that were true, we wouldn't even have built the civilizations capitalism now gobbles up.
> I can't attain those thing by not playing the game.
Start with not referring to abstractions like "the game". People say "hate the game, not the players", but that's like saying "hate the group, not the individuals that form the group". It's your game, not "the" game.
I know for a fact, from my life and the people I read, that you're wrong. If what you said was universal there wouldn't be so many exceptions. It's just that the people who somehow started to chase external validation only hang out with people who do the same.
As for being a "big deal with access to pretty women" -- be attractive, or let pretty women be, period. The second they fuck anyone for any reason other than finding them genuinely hot, they cease to be pretty, and only the ghouls collecting them as trophy don't see that. There is no "problem" here that isn't better solved with a cold shower and people growing up.
> Awareness that you're playing a prisoner's dilemma game doesn't do anything to change the outcome if you can't organise with and trust the other players to agree to outcomes.
Maybe you personally can't. Maybe you should learn from those who are doing it, instead of making excuses and pretend "everybody can't do what I think I can't do".
> Me abstaining wont change the world
Look at the wall of text you just wrote to keep it as it is. Even not writing it would have been doing more.
> Of course it's extremely easy to say, the heck with it. I'm just going to adapt myself to the structures of power and authority and do the best I can within them. Sure, you can do that. But that's not acting like a decent person. You can walk down the street and be hungry. You see a kid eating an ice cream cone and you notice there's no cop around and you can take the ice cream cone from him because you're bigger and walk away. You can do that. Probably there are people who do. We call them "pathological". On the other hand, if they do it within existing social structures we call them "normal". But it's just as pathological. It's just the pathology of the general society.
-- Noam Chomsky
You can't have your rationalizations and also be a still in the company of people, intelligent or not, who never ever gave in, never gave up, never became accomplices. Can't serve two masters, made a bad choice, and if you can say "tough shit" in the context of exploitation and deception, I'll say "tough shit" in the context of that.
Mint, 401k Management, Bill Pay, TAXES, Yahoo Finance, Student Loans, the old Manilla (collecting ALL aggregate statements in one place forever.)
They should buy Schwab, Envestnet, Personal Capital, YNAB, and Motif and slap a Robinhood/Monzo coat of paint on a new frontend. They could go from Apple Pay to Best Banking Experience in the World, in no time. As far as "Services" go apple competes in Music, Health, Maps, Messaging. They dont compete in Backups, Photos, or Banking. I would love for Apple/Google/Facebook to move aggressively against Intuit/TurboTax, if for no other reason to create a more competitive environment.
Imagine Apple getting into LENDING. They have cash up the wazoo. They should be able to determine who is most likely to pay back a loan, and come up with pretty accurate interest rates. And at that point, why is apple just a personal bank, and not a corporate bank as well, fully taking on QuickBooks. And if they dont want to get into business logic programming, become a Financial version of AWS and offer finanance, accounting, and banking APIs as a service, for App Developers to build on top of, like a AWS/Firebase/Pulse meets Chase/WF/Intuit.
I find it VERY odd that none of the big players (Microsoft, Amazon, Google, Samsung, Sony, Facebook, Apple) have done anything more than a Wallet and Money Transfer. Why is Mint/Personal Capital/YNAB not on everyones radar. Why are TurboTax and 401K management not being looked into by ANY of the major tech companys? So many people have a bunch of accounts that need individual management. Make my life easier Apple/Microsoft/Google/Facebook.
Ive outlined this idea before. https://news.ycombinator.com/item?id=12868316
I ALSO think SOMEONE should come up with a "financial ID." Instead of signing into banking sites with "Facebook" or "Google" each one has its own unique login, password, security questions, validation. One Financial ID, isolated from Social IDs could drastically cut down on phishing, hacking etc. Smaller institutions would not be running their own Identity/Trust silos in isolation. Resources to build trust over who is who could be shared. Intuit has something like that for their services, but it really needs to be a Chase/WF/BoA effort like Zelle. "Sign in with your Pony ID"
We do have those in (some parts of) Europe. BankID in Sweden comes to mind.
apple's move here is to use applepay as a platform to allow other companies to do those things. they're executing that strategy quite competently. they won't (i.e., can't) ever become a bank (consumer, lending, commercial, or any other kind).
(and your overuse of capitalization is making me twitch uncontrollably =)
Apple is not just an electronics company, and their latest earnings report makes that exact point. Its about subscriptions and service, not devices. They want to hook you on Apple Music.
Fintech isnt just banking. Intuit, Personal Capital, and Envestnet are services that layer on top of banking.
What I described is not an all or nothing approach, its a bunch of ideas. Apple could very much add money management services without offering lending.
Making someone like Schwab their "first party" bank would mostly be a commitment to customer service and "it just works" more like Apple Stores, than anything else.
I'm enjoying the hell out of it currently with these guys.
I would wager that you need to pay more attention to your finances. As the old addage says, "look after the pennies, and the pounds will look after themselves"!
I always heard adages and advice about "watching pennies." In practice, though, I've found that I'm far better off looking after the pounds and not worrying about the pennies: that is to say, set up savings targets that get treated like necessary expenses, and to not worry too much whether lunch is $7 or $12.
Is there a way you could split each area to a separate account/card so that you can spot odd spendings? eg. recreation on one, business on another, food on another, fuel on another, general household/mortgage/insurance on another, and then another for miscellaneous ?
Sounds like an opportunity for an app of sorts....
Google Photos does full res backup - easy to get working with android - not sure about other devices or non-phones.
Mr BuyBack Cook could have bought Sony 3 times over already.
We have 2 apple computers, and apple tv, 4 android tablets and three windows computers, 1 iphone, 2 android phones.
I dont think any of my friends are apple-only, even those who love apple.
Is an apple-only household really that common?
You point out two distinct aspects, how locked in is a locked in household, and how many households are actually Apple only. I bet it’s rare to be all-Apple households, but Apple should be finding ever more reasons for a household’s next purchase to be an Apple related one. Since my locked-in household still only buys so many devices per person per 2-3 years, Growing services is another way to do it.
As far as degree of lock in, I’d say not much, I think it could all collapse with a few major missteps. There’s an enormous amount of pressure on the board of directors and C suite to maintain the expected quality.
This article made me stop and think about Apple's future, and to be honest, the future of computing. I think it is clear that in 10 years mobile computing has reached maturity (which is astounding). There is no broad use-case advantage that iOS has over Android (ie, I can communicate on both of them, I can get directions on both, etc).
It seems as if we have reached a valley of sorts, in which the use-cases and potential businesses that can be built on top of a computing platform that is always connected, always with us are mostly tilled ground. Discovering and inventing new ones takes an enormous amount of effort and ingenuity. It would be easy to think that most of the disruption has already happened.
However, what surprises me is that Apple is doubling down on performance. The processing capability of iPhones continues to rise, even when we see that the software that uses that capability has diminishing returns.
My best guess is that Apple is playing the long game, and that they see the investments that they are making in performance will pay off greatly in the coming years, because suddenly our phone will be more powerful than our desktop. And, while it is easy to scoff at that as being unnecessary, I think it actually will begin to unlock new use-cases that will lead us out of the current "valley of diminishing returns."
The obvious candidate here is AR, but I think it actually is broader than that. It is clear that Apple is moving towards a system in which the iPhone is a computational Sun, around which multiple accessories "orbit". I think such a system, taken into consideration along with cloud computing is actually incredibly exciting, and I think (as much as this audience might dislike it) that desktops and laptops truly are the current past.
It's a little like a solution looking for a problem, but it seems like a good bet that we will have some of those problems in the future. I guess more like a solution waiting for a problem?
I was thinking AR/VR when I read your paragraph 4, and then you said it at the end. So, I completely agree with you. I think most disruption is behind us, but the new wave of Deep Learning enabled computer vision/speech recognition will probably trigger a new wave of use cases and thus new business/services.
The only way I can see that happening is if people stop upgrading their desktops for years and years AND phones are able to make steady performance improvements AND people don't stop upgrading their phones regularly.
Larger form factors (both desktop and laptop) have physical advantages when it comes to performance (e.g. cooling, more power), and I don't think they can be beaten by a smaller form factor in a fair competition (e.g. chips at similar process nodes).
If mobile computing has reached maturity like desktop computing has, I can see people holding off their mobile upgrades the same as they hold off their desktop upgrades, which would mute the main way mobile can get a performance edge over desktop. The burn-the-ships software update cycle that's more common on mobile may mitigate that, but it's coming to the desktop so it may not be much of a difference in the future.
Why would a consumer spend $1500 on a laptop that they use 1-2 hours a day, compared to a phone they use 8 hours a day and is always with them? I'd argue that we are already at the point where most consumers aren't even at the point of considering traditional "computers" in their decisions.
You touch on a good point about software. I think it is the biggest current stumbling block. It is currently the case that desktops and laptops offer significant workflow advantages over mobile devices, even for consumers.
I think as long as you act primarily as a _consumer_ of other people's content, this is accurate. As soon as you want to _create_ media of your own in any significant way, you then need a keyboard, a larger screen, a decent pointing device, etc. (maybe not all of the above for a particular creative endeavor, but these sorts of things).
The question then is, what percentage of people create enough to need creative devices, and what percentage are happy just being consumers? I think Apple is focusing on the creatives.
Compliance and security is the magic of iOS. It's pretty trivial to deploy them securely, whereas with Android is a mess that requires lots of third party stuff. Hopefully Chrome will come to the phone someday to address that.
If you really care about device security, it's pretty difficult to not use an iPhone. The only exception that is a clear winner is for field service and other folks who operate in extreme weather conditions, due to iPhone's narrow operating ranges.
I think that's an important insight on how and why Apple is lapping the field on the processor side.
They've hired the best team they could and freed them from all constraints other than physics based ones.
Take the best available node process, sprinkle in any custom algorithm acceleration necessary for voice/ai/camera/ssd throughput, and wattage consumption vs battery, figure out heat dissipation constraints, then max out performance.
No need to create a variety of silicon at slightly different price points- iPhone XR gets the same chip as XS, despite being a cheaper phone. New iPad does get one, since it has to push more pixels and has thermal headroom.
Meanwhile Intel or Qualcomm are creating very artificially specialized hardware at a multitude of price points- while also having to keep off features on their SoC's that don't have broad applicability.
The genius of this move into hardware is paying off more each generation.
Moving the goal posts on performance, beyond what is reasonably necessary, simply incentivizes and challenges developers to start making bigger and better app experiences. This is a passive form of ecosystem insulation that further separates Apple customers from Android customers.
There was a meme a couple years ago, maybe, that on Snapchat you could tell which one of your friends used and iPhone and which ones used Android purely based on the image quality of their photos/videos (I don’t think this is still true). If Apple can silently get devs to start developing apps for the A12, the gap between an Apple experience and an Android experience gets wider and wider IMO.
It doesn't particularly speak to the power of the devices, it was more a way to cope with the spectacular fragmentation of Android hardware.
This isn’t really true. At least, once you start using iMessage it’s no longer true.
If you try to switch to Android you will be silently dropped from any iMessage group chats you are in. You will also no longer be able to send high quality media to iPhone users.
It’s like building a high performance supercar to learn and grow in order to understand how to bring that technology to a lower powered and more effecient vehicle.
Dev here, I actively campaign against Apple (and FAAG) products.
They seem like a danger to our capitalistic system as they have enough power to sway politics.
Apple has always been anti-dev from my point of view, forcing users to use their hardware and pay to produce apps.
While there doesnt seem to be many 'good guys', Apple has used their weight to constantly do unpopular things for their customers and developers.
My only hope is that Apple will fail to innovate, and users will begin to go toward more consumer and dev friendly high end products.
For someone that doesnt mind getting tailored ads, the privacy argument is a non-issue. I am curious how long this will last at Apple as well, they don't strike me as a company that wouldnt sell your data.
EDIT: HN is very weak when it comes to critical thinking on Apple products...
Such as?
Good! Capitalism has failed a great many people.
Business owners using their power to sway government is the foundation and backbone of capitalism, historically (sure, it may violate post hoc rationalizations of capitalism, but those have little to do with capitalism as it has existed in the real world anyway.)
No one says you have to use Apple's payment processor. Direct users to sign up on your website and then have them download the apps free of charge.
Btw; So does Google and Microsoft. They all take a cut of every app sale. The difference is the rate they take out.
Oh, for Apple, it's 30% the first year of the sub only, it goes down to 15% after that.
Apple has removed apps from the App Store for doing this [1]. You have to provide an in-app subscription option that gives Apple the 30%/15% cut.
[1] https://changemap.co/hellocode/exist/task/1855-apple-blockin...
Did Exist offer a way to sign up new accounts in their app? If yes, that may be it.
Slack doesn't have IAPs and yet, I can sign in with paid accounts just fine. There are other apps that were like this but they didn't have a way to sign up in-app IIRC.
So it only works if users first go to your web site, sign up, and then get the app on the App Store. If they get your app on the App Store, there’s no way to convert them without Apple’s blessing.
Essentially Apple contractually mandates friction between you and iOS users and then charges you to alleviate it.
https://www.anandtech.com/show/13540/apple-announces-q4-fy-2...
IDC just reported that during the same period the overall smartphone market shrank by 6%.
https://www.idc.com/getdoc.jsp?containerId=prUS44425818
Samsung just reported a 33% year on year smartphone sales drop.
https://www.telegraph.co.uk/technology/2018/10/31/samsung-re...
Growing unit sales while the market is contracting doesn't really scream "doom" to me.
Yes they are one thing, just with two sides to it.
You don’t get to be the gatekeeper of what constitutes an open AOSP phone or anything else. If you say AOSP has a better track record than Apple in terms of privacy and security, on what basis do you get to say “except all the AOSP phones with Google services and misc crapware and insecure hacks slapped on by their no name Chinese OEMs?” Those are open too. How does that exception serve the hundreds of millions of people walking around with old unpatched ‘open’ phones full of insecure junk-ware and manufacturer hacks?
By the way, if you really want to experience cognitive dissonance contemplate the fact that those same 'Chinese OEMs' produce Apple hardware. Just look at the back of nearly anything branded with that apple, it'll say 'designed in California, made in China' or something similar. Do you still trust that iPhone in your pocket knowing that it was made on the other side of the Great Firewall?
If you give your stuff away and third parties hack, abuse, crapify and sell on your stuff with a name associated with you on it, that’s a problem.
It is more open, but it’s more open to abuse much as to anything else.
They've had some successes like Apple Watch, so I wouldn't write Apple off just yet. But yeah, the things they've missed which they should've known better about is a bit concerning.
Markets that started before the iPhone and when Apple was collaborating very closely with Google.
Apple let Google win in those markets without opposition and then Google stabbed Apple in the back with Android.
Reminder that the original iOS versions had YouTube built in, and Google Maps.
Look at Apple Music. Spotify was released in 2008. Google Play Music All Access in 2013. Apple Music was released in 2015. For being technically 8 years late, APM has 50M subscribers, compared to Spotify's 75M [1] (GPM is probably harder to measure because the subscription is combined with YTP/YTM, I pay for it but literally never use it). If that wasn't impressive, realize that APM is marketed just to Apple users, whereas all those other platforms do everything they can to get users on every platform (APM is available on Windows and Android, though I'd love to see the user counts for those platforms over the competition, likely very low).
Apple Maps and the routers are really weird things to pick on. They're not core at all to Apple's business model. They're fungible products; you can use any mapping software or any router and get 98% of the same experience. Apple simply doesn't invest a lot in fungible products; they invest in products where they can make a true 10x difference for their customers. iCloud Drive is the same way; customers want it so they'll make it, but they're not going to drop $5B developing it.
An Apple TV subscription service is more similar to APM than anything else, with the exception that music streaming services are expected to have "everything" on the platform whereas streaming services just need to host those handful of shows you watch to justify the subscription price. And they might have a great lineup coming up the pipeline here; they've ordered shows from Ronald Moore, a TV adaptation of Foundation, a comedy from the co-creators of Its Always Sunny, a show produced by J.J. Abrams, etc; I think they're in a good place to drop a big announcement and secure a LOT of subscribers. [2]
[1] https://www.forbes.com/sites/careypurcell/2018/05/15/with-50...
[2] https://appleinsider.com/articles/18/07/11/here-are-all-of-t...
Out of everything you listed this is the one that I don't think Apple is really missing out on, as they were never positioned to be a major player outside the prosumer space which often has needs beyond what Apple was providing. The average consumer is an idiot when it comes to networking, most of them run ISP-provided equipment, and those that don't are often informed enough to get hardware to run DD-WRT/etc. or buy a proper prosumer solution like Ubiquiti's.
Back when wireless routers weren't provided by default with your internet service, a half-decent one wasn't cheap, and people just wanted a simple solution that "worked" then the Airport had value in ensuring Apple's other products had connectivity. There's no benefit to them doing this now, and Apple is not positioned to get into the prosumer/business SDN market that Ubiquiti is in.
1) Just because the Ubiquiti founder came from Apple, doesn't mean that Apple should be in the quasi-enterprise networking space that Ubiquiti is. Apple's networking gear was always aiming to be simple, plug-and-play hardware for people who don't want to think about networking. That's pretty much the opposite of Ubiquiti's products.
2) When Apple was still doing things like networking, we had a lot of people complaining that their focus was spread too widely, and their core products were suffering.
This is the real kicker in today's landscape and why it doesn't make sense for Apple to even be in this market, there's no such thing as "plug-and-play" for the majority of consumers these days when for proper functionality you must go into your ISP-provided equipment and disable the WLAN radio, put it into passthrough mode (if that's even possible, some ISP's like AT&T don't even provide equipment with proper passthrough mode), god help you if you use DSL and need to get PPPoE credentials which are automagically configured for you these days by some captive portal when you first plug your equipment in.
It's literally harder to use your own equipment these days than it used to be before every ISP started providing integrated gateways, so the current market for standalone equipment is people who need something other than "plug-and-play" - because they already get that from their ISP (even if the hardware usually sucks, it's good enough for the average consumer who thinks they get "their WiFi from Comcast").
Apple doesn't need to be in networking anymore, there's not a large enough market for products like the Airport AP's anymore and if they actually want to compete they have to battle with the likes of Ubiquiti, Cisco, Ruckus, HP (Aruba), etc. - not ASUS, TP-Link, Buffalo, Netgear, etc. Seeing as they have no plans to revive the Xserve, I doubt they care about having a foothold in wiring closets and datacenters.
But what I think the parent was referring to is that Apple has no hardware offerings for the home aside from Homepod and Apple TV. Meanwhile Google has Nest and Amazon has Ring.
That's insanely impressive; to be honest, would you rather the situation be "they're the largest company on the planet and they're extracting all the growth opportunities in the market that I can see?"
Apple has just announced a 20% year over year growth.
> but I think they've ridden that pony almost as far as it can go
17% growth in the services division that is now bigger than the Mac or iPad, and bigger than Facebook and Netflix (combined)
31% growth over year for the small accessories. Apple Watch, HomePods and AirPods cathegory.
The cathegories that poundits were betting hard on Apple losing and the "press" making downright negative reviews?
> They've lost some of the key risk-takers and creatives
Who are those?
That Tony Fadell that has been aquihired by Google and then fired because his company outright failed?
> Who are those?
Well, there was this guy Steve, for one...
So this is off topic but what I'm imagining is letting people connect with other iCloud users (aka friends and family) to share pics, videos and comment on them. Maybe they can link iTunes/App store content (apps, music, movies, etc.) with each other and comment on them too.
This might take a huge amount of more people off Facebook and bring them into Apple eco-system of services than meet-up like events at their brick and mortar stores. There are probably millions of FB users that just use it to connect with distant close friends & family to share pics, etc.
Edit: just to build on this idea a little, pulling people's actual social network (not acquaintances or long lost people they never see) could boost sales of their content. Let people share, like and comment on their favorite music, tv shows, movies, and apps with no ads.
IMO Facebook is for aspirational connectivity... you stalk your high school friends from afar. iMessage is for the people whom you actually talk to, and the green vs. blue bubble is a subtle peer pressure factor to get people to flip.
As more applications expose functionality via iMessage, that will get more powerful.
I use my kid's school as a proxy for the average joe. About 60% of the moms have no idea that Shared Albums exist, and most of them don't really understand how they work. The UI is a little weird.
Except... maybe they shouldn't? Maybe real life can be the discovery part.
(At least, so it seems from outside the walled garden looking in.)
One would assume this came down to the two companies views on customer privacy.
https://www.cnet.com/news/steve-jobs-on-why-no-facebook-for-...
I'm having a hard time thinking of historical business examples where in-store "educational" events really moved the needle on sales.
Maybe one example is Home Depot stores with their free demonstrations of various home improvement tasks. Do they actually change store visits or total sales? Or are they a loss leader? I have no idea. (Home Depot isn't an exact comparison to Apple because it doesn't require buying HomeDepot-branded tools to benefit from the demos.)
Remember 20 years ago when some industry observers thought Amazon online bookstore couldn't compete with Barnes & Noble because the brick&mortar store had the sofas and lounge chairs to browse books, the cafe area, the children's area where people read aloud, etc. It turns out those in-store social experiences weren't as advantageous as people thought.
Yes, there are other customer gathering experiences that happen such as video game e-sports leagues (or LAN parties) or Harley Davidson motorcycle meetups. But those social events seem organically created bottom-up by the customers rather than top-down by a hardware company. E.g. As far as I know, the e-sports league membership isn't tied to a hardware manufacturer like NVIDIA or ATI. (A particular hardware vendor may provide sponsorship but that's not the same as membership which is what Apple's "Today at Apple" is doing.)
>, this explains CFO Luca Maestri reasoning on the earnings call for no longer reporting unit sales: [...] I just wish Apple would show it with its reporting.
I think it's interesting that even if Apple wants to keep industry analysts in the dark, other entities like Amazon and Facebook can estimate iPhone unit sales by proxy statistics.
E.g. Amazon can run data analytics on sales of iPhone accessories (how many the new iPhone Xs cases sold and how does it compare to previous iPhone 8 case sales at launch?)
E.g. Facebook's popular iOS apps used by billions can send telemetry data on the particular iPhone models hitting their servers. (https://stackoverflow.com/questions/26028918/how-to-determin...)
Yes, but most of the largest ones are put on/heavily funded by the manufacturer of the game:
- CS:GO Majors
- Overwatch League is put on by Blizzard
- Riot Hiring for esports operations - https://www.riotgames.com/en/work-with-us/disciplines/esport...
-----
Apple is moving "down market" and the biggest win for them right now is for those to understand "what apple means." I've shifted 90% of my family to mac from whatever PC they were using before because of the reality of the physical store. Go there and get help. They know more than I do, and they will be helpful. For the most part, that's true, and I no longer do tech support for my family.
Grandma wants to learn how to photo edit? Now apple gives her a class and a community of other learners. It may turn out to be a loss leader, but it's "more of the same" of what separates apple from any of the other Manufacturers. Google/Samsung/Dell can't do anything close. Microsoft _might_ be able to, but lets see.
Of course, the iPhone was a unique product in terms of how it changed the trajectory of Apple's fortunes, and likely can't be replicated. It's dominated 24% of the company's history. (10 years between 2007 and 2017; Apple was founded in 1976)
If iPhone sales are flat, goosing the price makes sense, but it isn't the future of the company.
To be honest, as a technologist, I'm sort of relieved. I'm interested in what's next, and now that the iPhone (and smartphones in general) is a refined product, I'm really interested in what's next in tech.
I really don't see them going the "social" way. Cook does cloud software as well as Steve did (i.e. not very), he'd rather sell physical widgets and be a landlord on the resulting platforms.
I think this post reads too much into "Today at Apple", Apple are just reacting to Google building a similar network of physical locations for outreach and training last year, IMHO.
You know Apple has been offering free classes at their retail stores for years, right?
Are you suggesting “today” is just a coat of paint over the existing stuff?
Apple could then offer options on top of the basic services, AirPod, Apple Music, Apple TV Subscription, and may be even your monthly iTunes Store Credit ( Apple save more on less per-transition cost ), all in one monthly bill.
This way Apple could transition into a Services company, and services tends to be very sticky and can be valued as such, while the current Apple Stock, despite all the brand loyalty it is still valued as a hardware company based on unit sales. Apple would have been 2T company if it were valued anything like Microsoft , Google, or Amazon.
I also believe iPad Pro being able to have an external monitor, and hopefully someday keyboard and mouse will take over the current PC market with little to no competition right now. That is assuming Apple wants the iPad to do that, a replacement as Desktop. iPad Pro, being portable for field sales and mobile, iOS security and double as Desktop could be the perfect fit for All businesses. The TCO in managing these must be dramatically lower than Laptop or PCs.
Next, “Apple’s culture and approach to products is antithetical to the culture and approach necessary to create and grow a traditional social network. Apple wants total control and to release as perfect a product it can; a social network requires an iterative approach that is designed to deal with constant variability and edge cases.”
I disagree with the last sentence. Does the author believe that simply because that’s how Facebook chooses to operate - eternal bleeding edge? Constant mission shift, like Instagram?
Twitter seems fairly stable to me. I also recall when we used software like VBulletin for years without updates for very successful social networking. I don’t see why this software has a special need to cope with variability and edge cases, just to share photos and messages with people.
Can companies just pull this sort of "yeah those numbers look bad, so we're not publishing them anymore" moves with impunity? I'd have thought this was something the SEC could step in to stop.
Is the only tool shareholders have to oppose this to vote in an entirely new board? Which of course won't happen for such a "minor" issue?
As the article notes, Apple was unique in reporting unit sales at all.
That's not what was asked. What was asked is if they can just change what they usually report because it looks bad.
Microsoft has never provided unit sales or revenue figures for the Surface line.
>Microsoft just closed the books on its 2018 fiscal year. As usual, it didn't break out unit sales or revenue for the Surface division
https://www.zdnet.com/article/surface-by-the-numbers-how-mic...
Google has never provided unit sales or revenue for their Pixel line.
>unlike most hardware manufacturers, Google refuses to share official sales numbers for their phone. Instead, during earning reports they simply bundle the product under Alphabet's "Other Revenues", leaving us in the dark about how successful the product is.
https://android.gadgethacks.com/news/rare-moment-pixels-sale...
Is Apple increasing the price of iPhones to keep up with revenue growth ?
So in the end, when a consumer wants to replace his iphone 6s that is finally too much out of date he'll have to pay more than if everyone (him included) had bought the iphone that came after the iphone 6s, right ?
So basically selling a product that last too long is a problem for Apple (who has to report to shareholders why revenue is growing less than before) and the consumers (who pays basically more for the same since standard usage between an iphone6s and an iphone7/8 stays the same overall) ?
Apple can't take a drop in revenue growth to the benefit of consumers by selling the next crop of iphone at the same price. So they are condemned to get a more expensive (than the last one) premium iphone out or raise the prices across the line-up. And if I understand correctly they did both, correct ?
That would explain why it seems to me that apple products are getting more expensive and less of a commodity (which high volume would suggest).
So it's very difficult for Apple to find more customers (just Android switchers, mostly), so they raise prices for their existing customers instead.
Why do sales always need to grow, why sustaining is not enough?
Also wouldn't it be a good idea to change the focus product periodically? I.e. we've sold so much iPhones that everybody who ever wanted one has one already, let's focus on making MacBooks great again so more people would consider getting one or upgrading their old one, then once some time has passed and everybody has a new Mac let's start selling new iPhones we were developing during this time that is so much better thst everybody is willing to upgrade again... IMHO inflating sales growth by releasing a new not-much-better model of the same product every year or two is hardly a healthy sustainable practice.
But one point to consider is the population expands by approximately 2% per year. (Highly variable depending on region, of course.)
If growth in sales isn’t at least 2% per year, that implies a smaller percentage of the population is buying their products than have previously.
In other words, sales remaining flat can be interpreted as a relative decrease in sales.
They don't, but then the stock price goes down.
I wonder this often myself too. It's unorthodox, but I wish more companies focused on staying sustainable rather than trying to grow continuously (or making growth the only goal of the company). A good book on the topic: https://www.amazon.com/Small-Giants-Companies-Instead-10th-A...
That Android has dominated the $50-150 smartphone market is pretty meaningless. Those customers don't have much business value.
When you talk about "sales" you can only compare handset manufacturers because total sales going to one _android_ manufacturer isn't happening, therefore it becomes apples (heh) to oranges.
Apple has only recently been overtaken in handset production (not sales) https://www.theguardian.com/technology/2018/aug/01/huawei-be...
Apple's sales are slowing down faster than others. Speaking only for myself the "bravery" in removing the headphone jack (which everyone seems to have copied) and lack of a small option are what prevents me upgrading. I imagine others have similar qualms and it's really not worth upgrading for many.
It isn’t really in Apple’s DNA to try to win over the low end of the market, so there’s limits to how far they could take the first strategy. The second is effectively limitless: Does anyone think personal devices can’t keep getting better / more useful / more desirable?
hmmm ;)