Apple Foldable

Just realized that the iPhone Air design of putting all the hardware (save battery and screen) in a single block module suggests that an iPhone foldable will probably have a chin (or forehead?) so that, when open, it won't be a rectangle but, instead, have a block (a reverse notch) along the bottom of one half of the unfolded screen.  This would allow it to be incredibly thin when folded (because the leaves would just be screen - maybe even no battery in the leaf - only in the block?).  And still very thin when folded.

Or maybe the block module will be lengthwise in the spine?

Apple Watch case design

Some complain that Apple's roundrect/squircle case design for the Apple Watch is inferior to a truly circular dial.  Others note that the current design more efficiently presents information, especially text info.  I like the Infograph face but I'd like it more without the weird curved complications.  Infograph Modular is less attractive but is right at home in the squircle.

I wonder if Apple's new watch faces suggest we will someday see two case designs - each with their own compromises - as sales continue to increase and more users come in.  I thought about this as I noticed how much Apple has tried to "fill-in" and curve the text and information of the corner complications on faces that seem designed primarily for a round dial.  This test of the circle is especially noticeable when looking at the old version of faces such as Utility (which really embraced the square) in comparison to the new version (which seems torn between square and circle - and is now horrible looking, I feel).

I know that app developers will have a hard time handling two different screen shapes but perhaps Apple can differentiate models enough that consumers know they should not expect apps designed for squircle cases to look right on apps designed for round cases.  Or, maybe, Apple can draw a strict line between Apple Watches so that one cannot load a "round app" onto a squircle case, and vice versa, except for some sort of universal binary version that correctly handles each.

iPhone naming

I had thought that the iPhone X designation was selected to allow a temporary new premium price point (because that is the cost of getting the future today) as a test.  And that we would eventually see a move to non-numbered naming once we got past the 9 (similar to how iMacs and iPads are no longer numbered).  So it would just be iPhone (without ridiculous numbers like 18 showing up someday).

Now, with no iPhone 9, I am a little concerned that X somehow part of the iPhone name, sort of like how OS9 went to OSX and then OSX became the name of the OS itself with numbering continuing onward regardless.  But it seems cuckoo for ALL iPhones to be named iPhone X so am still hoping reason prevails.  Maybe the X disappears once all numbered phones are gone?

So maybe in a few years, there is just "iPhone" with letters indicating where in the hierarchy they stand.

A small note - the surprise that the XR has the same chip and camera as the XS seems misplaced - the 8 had the same chip and camera as the X so it makes sense that the XR (which is really a 9) has the same as the XS.

A smaller note - I thought the X meant we were seeing two years ahead but all we were really seeing was the X line that would come into its own in 2018 (a one year advance look).

Apple and in-house chips for MacOS

Lots of commentary today around Bloomberg's story regarding a switch by Apple to in-house chips (from Intel) for the Mac.

Perfectly consistent with Apple's stated goals (control the whole stack) and addresses some issues (waiting for Intel, instruction sets sometimes not even needed, etc.).

Of course, transitioning won't be trivial but I wonder if a solution is viable given Apple's unusual business model and execution.  Simply said, why couldn't Apple just include BOTH an Intel chip and an in-house chip?  The costs of a processor seem to be in the $25-40 range.  Given Mac pricing, it seems doable to just build in both and use the appropriate processor as necessary.  In fact, notwithstanding Apple's adherence to strong margins, they could even swallow some (or all) of this and treat the extra cost burden as sort of a down payment on the future to derisk the transition for a couple years.

I know this is the exact opposite of Apple's usual course of taking the hard decision and stepping firmly into the future (or at least Apple's vision of the future) but, if viewed as a choice between emulation software and simply including the hardware, maybe this is more user friendly (and thus entirely consistent with Apple's approach)?

lots of HomePod questions

I've been wondering how HomePod will work with different people for things such as messaging, calendars, etc.

I wonder if there will be a limit on the number of "authorized" or "recognized" users?

Remember how in iOS 9 Siri now had to be trained for a specific person?  Perhaps we can give permission to share those voice patterns so that HomePod can recognize individuals?

Sharing music libraries is going to be wacky.  I guess if at least one authorized person has Apple Music, HomePod will allow all authorized users?  Otherwise, it will create some ill-will for music to be available if only one person gives the command.  But how will playlists work?  Can one person destroy another's?  And what about age restrictions?  Tricky.

And, because this may be more than a technical issue and instead is a contractual/regulatory one, how will telephone hand-offs work?

I guess we'll learn a lot more next week. 

iPhone X production shortfalls

Given the history of launches and related shortfalls, I assume the X will be in short supply.  Unfortunately, news reports (rumor reports?) suggest that the X will be even more constrained at launch than its predecessors.

BUT, maybe they are wrong - why else would Apple be promoting the X so heavily on its homepage more than a week before launch (I assume most casual customers are not pre-ordering at midnight Friday)?

Beats

The more I see AirPods on the street, the more the Beats acquisition, at least in hindsight, seems sensible.  Which is funny as it was difficult to explain when it closed (i.e., less than 3 years before the introduction of AirPods).

Of course, thinking about other acquisitions, it fits in with Apple's history - purchases show up in product in 2-4 years.  But, time and again, it's hard to see things differently from the past.

Apple's i

I woke up this morning thinking about the Dustin Curtis tweet suggesting that Jony Ive said: "he believes Apple will be a health company in 20-30 years".

I wonder if this is less speculation than a very specific path Apple is working on.

Aging populations and health: If there is a market that is set to grow and is underserved, it is the health and wellness needs of an aging population.  It's a large market - one large enough to move the needle even for an Apple.  Apple is focused on health.  Apple is also focused on "where the puck is going to be".

Technical sophistication:  Some products require integrating the full stack, including custom silicon.

Camera experience:  By some measures, Apple is the most used camera in the world.  They certainly take cameras very seriously.

Augmented reality:  Apple is all-in on augmented reality and machine vision.  "Understanding" and simplifying images to pull out key elements is hard.  I think the A11's neural engine is a first step there.

Privacy:  An omnipresent product, especially one with insight into your life, should have a reputation for privacy.  Many potential competitors would be hard pressed to credibly show that they have privacy as a primary concern.

Manufacturing:  Apple is a hardware company.

An artificial eye could bring these elements together.  A trustworthy camera that will need to interpret images on the fly to present a simplified version of the world for the millions of people who will be facing weakening eyesight as they age.

For fun: just look at the shape of Apple Park!

More fun:  they can just call it the "i" and drop the mike.

Wearables

To get a sense of what Apple's "wearables" business might look like, I think of:

1) the Watch as an iPod;
2) AirPods as an iPhone accessory; and
3) Beats as transient.

From that view, given that iPods sold about 40-50 million per year from 2006-2012, it seems plausible that the Watch could sell 40 million per year.  As noted before, the Watch is cheaper than most iPods were and is far more versatile than any except the Touch.

Airpods have a meaningful cost but are not outrageously expensive relative to other truly wireless headphones.  If I treat any headphones (including Beats) with a W1 (which is really the key to the AirPod) as being an "AirPod", I can imagine 10% of iPhone buyers also buying AirPods.  Approximately 200m iPhones are sold each year so this is about 20m AirPods a year.

I think Beats sales (actually, sales of all expensive large headphones, of which Beats is the largest brand) are a bit of a fad so, except for those that include the W1, I assume Beats withers away over time.

Based on this and an average Watch price of $300 (this excludes accessory sales) and AirPod price of $150, we see easily $3.7b per quarter in revenues without any significant advances over what is out there today (some incremental advances over time of course, but no sharp breaks).  Assuming that accessories, Beats, AppleTV and others in Apple's "other products" segment are non-zero, it seems reasonable to think there is well more than an additional $4b in revenue a year from the Watch and AirPods.  Or, as one might think of them, from the S and W series chips.

Apple iPad Pricing

If Apple is sincere in its stated belief that iPad is the future of personal computing (i.e., “PCs aretrucks”), Apple’s relatively low pricing strategy makes great sense.  Setting up an established base of users can create a virtuous circle of application development to defend against an assault by an alternative future.  And setting such a base up quickly makes sense if establishing that defensive wall is the goal.

I say "relatively" low pricing strategy as I know iPad prices are not low.  But they are lower than one might expect of Apple.  This is a company that still wants to make sure it makes money when it sells something and so maintains healthy unit profit margins.

To balance these competing goals (margin and scale), Apple must keep its prices realistic and this has resulted in a pace of advancement that is likely slower than what Apple is actually capable of (iPads could probably run macOS if they had to).  But that is fine if advancement isn’t necessary to grow the market or, put alternatively, if the market can be grown more quickly through price than with specifications.

check back in October 2017 and 2018

Apple hired a person who may be the smartest person on the planet to play a large role in Siri.  I know him personally and believe we will see something remarkable over the next 6-18 months.  Just wanted to set this out now for credibility (or claimchowder) in the future.

iBook

If Apple decides to make a notebook form iOS device, the iBook name is waiting (the last iBook was in 2006).  Aside from the iMac, the name fits perfectly with the MacBook, iPhone, and iPad naming conventions.

iPads already support trackpad like cursor control (and I guess some iPhones do too?).  And iPad Pros seem focused on keyboard support.  So offering a better keyboard and a trackpad experience is not a big jump.

I wonder what will be the catalyst (nominal or real) for something like this.  Office is already available.  Screen size is already there.  Maybe an issue with the ergonomics of touch on a vertical screen?

AirPods!

Got my AirPods today.  Some quick observations and a rant about poor customer service...

Fit.  I knew they would not feel super secure because I already knew that regular wired EarPods don’t fit well in my ears (and most reviews have said they are pretty much the same shape).  So I won’t be running or doing cartwheels with these but that is not a surprise or a disappointment.  What is interesting is, as many other people have noted, the lack of wires means they feel more secure than regular EarPods because there is simply less weight trying to pull them out of my ears.

Sound.  They sound fine.

Controls.  I found that my right pod did not respond to the Siri double-tap at first.  But, after about ten minutes, it started to work (but still less consistently than the left).  Perhaps I wasn’t double-tapping the right way but, really, how many ways can there be to double tap?  I’ll keep an eye on this.

Siri.  As others have said, Siri seems to work better on the AirPods than on the phone (she is more likely to understand what I am saying).  A feature request: I would like to be able to control the volume of Siri’s confirmation beeps.  A related feature request:  An app (like for Apple Watch) would be a nice addition, especially as AirPod controls are scattered throughout the phone.

Pairing.  The initial pairing is as seamless as universally noted.  However, I’ve found that opening the case near my iPad doesn’t trigger the battery display as, I think, it is supposed to (the iPad is clearly connected as I can switch my audio to the AirPods from the iPad easily and I can force the battery widget to show me the AirPod battery remaining).  It works on my phone so I’m pretty sure I’m doing it right.

Purchase.  I used in-store pick-up today and had the WORST experience I've ever had at an Apple Store.  Very disappointing.  My intake person was too busy talking to a co-worker to help even though she was standing at the entrance.  I opened the Apple Store App to show her the barcode and she said I was doing it wrong (I was not, as I showed her).  She then stood next to me for 10 minutes, playing with her phone, not seeming to notice or care that I hadn't received my product (the store was pretty much empty with about a dozen staffers wandering around, straightening up, etc.).  Finally, I asked if it was supposed to take this long.  She seemed puzzled and then said "I don't know if they are picking it up from the back or here.".  She wanders off.  About five minutes later, after I complained to another staffer, she comes over, super proud that she has the AirPods.  They were sitting in a drawer about two steps from where we were waiting.  She said: (i) it wasn't her job to intake customers (confusing then, why she processed my pick-up); (ii) she wasn't allowed to go to the counter to get merchandise (seems strange that she then broke some rule to do so?); and (iii) I was having a bad day (true - because of her).  The fact that she didn't care that her own customer was standing around waiting for something that ought to take maybe 2 minutes (again, the store was pretty much empty with tons of staffers unoccupied) and then said it wasn't her job to help me was unbelievable.  Apple Stores can be a little bit slow-motion but this was just rude and antagonistic behavior.  I hope she gets fired.

W1's killer app

The killer app for Apple's W1 chip is CarPlay.  Assuming a modest cost to create the chip, Apple could offer the chip to automakers to embed in the dash at no-cost to permit one-tap pairing, a more stable and smarter connection, etc.  Pairing headphones is painful but pairing in a car is worse as automotive systems often have two different Bluetooth profiles for the phone and audio – in particular, Siri runs over the phone profile and so will interrupt audio streams.

Headphones traditionally (but maybe not for long) use wires but cars traditionally use wireless.  I think W1 is starting with headphones but is intended to be extended out to a range of IoT devices and headunits, including and especially the car.

iPhone SE backorder

I ordered an iPhone SE on May 26. Apple estimated it would take about 2-3 weeks for delivery (that is around June 14).

I figured that, as has been typical for Apple, 2-3 weeks was a conservative estimate and the phone would arrive well before that. Instead, the delivery window hasn't shifted at all.  In fact the estimate for the earliest delivery date is now 3 weeks from the order date and the outside date has shifted to 4 weeks...

A few questions:

1) were sales completely underestimated? It seems clear that original estimates were low (given that the phones immediately went on backorder upon release).  But now it seems that estimates continue to remain wrong?
2) why are they still backordered? Is it supply and not demand?  Has demand increased and so made even revised sales expectations too low? Or is supply somehow constrained as Apple gears up for iPhone 7 (if there even will be a major change to an iPhone 7).
3) why were sales so underestimated in the beginning and, perhaps, now?
4) will up-to-date iPhones henceforth come in 3 sizes (4, 4.7, and 5.5 inches)?
5) will Apple change the launch cycles for iPhones and iPads to Spring and Fall, respectively?  I think this would better match gift cycles (it is cumbersome to gift an iPhone because of carrier subscriptions and so moving away from holiday makes sense).

All in all, the pessimism around Apple seems odd if even a phone that is cosmetically identical to the 4 year old iPhone 5 can sell out for weeks (and perhaps months).

What is a success?

I’m not cheerleading for the Apple Watch (exactly matching this article, I find myself simultaneously: telling most people not to buy it and yet, personally, wearing the Watch every day).

However, when it comes to determining if the Watch is a success, it seems like it would be useful to think about the right frame of reference.

The wrong frames of reference:  Annual sales in comparison to the iPhone’s revenues.  Annual sales in comparison to Apple’s overall revenues.    Benchmarking against the most successful product of the past 10 years? Revenues of the most valuable company in the world?  I agree they are relevant for the purpose of figuring out if the Watch will be a “needle-moving” business for Apple but they are bizarre benchmarks for success of the Watch itself.

I don’t know what the right frame of reference for success is but suggest that they might include:

1) Familiarity/Recognition.  This is measuring the success of building mindshare and interest in a new product - how well was the product rolled out.  Here, we have a product introduced less than a year ago that is widely recognized on sight and at a distance.  Even more conspicuously, if I say: “Is that The Watch?”, a large portion of listeners will assume I mean the Apple Watch.  For a newly introduced product, that seems like a measure of success.

2)  Market Share.  Unclear what the right scope of the market is (all watches?  all watches over $200?  all watches over $200 but less than $1000?) but it seems like it would be fair to compare the Watch against well known names.  Taking the three largest Japanese watchmakers (Seiko, Casio, and Citizen), their combined annual revenues are about $3 billion.  The largest Swiss watchmaker is Swatch/Omega.  Its revenues are about $10 billion.  If Apple Watch has sold anywhere near the numbers guessed (maybe 10 million), Apple is one of the largest sellers in the world by revenue in its first year (probably $7 billion).  For a watch (not a mobile phone, not an automobile), that seems like a measure of success.

3) Creating Prospects.  Apple Watch is a very imperfect product.  Releasing it in its initial state may have been a mistake (then again, given the above, maybe not?).  But, maybe a measure of success is how well Apple has created a potential platform.  The work of figuring out size, positioning, appearance, functions, and relationship with the phone seems to be pretty on target (given the balancing required by the state of technology and battery life).  The Watch doesn’t do all the things it should and many of the things it purports to do it doesn’t do well but, if part of the job is to create a credible platform that is worth paying attention to, again, the Watch seems to be a success.

iOS adoption rates

I wonder to what extent iOS adoption rates are affected by the longevity of iOS devices.  For example, if the rate is truly determined by looking at the number of unique devices that access the App Store, older devices that cannot support the most recent iOS release would drag down the reported adoption rates.

It would also be interesting to see official adoption rates by device (iPhone 6, iPhone 6S, etc.) or at least device type or vintage (iPad, iPod Touch, etc. or 2015 purchase).  There are unofficial trackers that do exactly this, but it would be nice to have more authoritative data.

Finally, it would be nice if the official page gave some detail on the methodology beyond being “measured by the App Store”.

Perhaps a small product portfolio and growth are not at odds?

This DaringFireball post made me think a little bit about the recurring (2015, 2014, 2013, 2012) theme of "Apple is too dependent on a single product".

There's no doubt that Apple's results and future are closely tied to the iPhone's continued success.  But I also think it is important to think about how much that concentration on iPhone has created the success.

Gruber's comment about Apple's rapid and enormous growth (i.e., both its rate as well as its rate in the face of its large size) highlighted, again, the importance of having a small suite of products (the fabled: "We can put all of our products on the table you're sitting at").  It's not news that the sharp focus allows Apple to break the mold of low-return device sales.  My small question of the day is whether, beyond customer satisfaction, the only way to manage a giant company (at least by market cap) successfully is to have a narrow portfolio of products?  I'm distinguishing between a complex company and a complicated product mix.  There can be a lot of activity (a complex company) that supports the sale of those products but, to make sure efforts are coordinated, the products (and thus goals) must be few.

And the portfolio is even smaller than it may appear.  The criticisms of "iPad is a just a big iPhone" and insight that AppleTV is just a display-less iPhone also mean that the products have significant overlap.  Which means that the supporting underlying activity for each is largely complementary.

And, as I write this, I realize it may be captured in the Asymco post I just linked to - from 2010 (of course Asymco figured this out a long time ago).  Oil companies (the title is "Apple vs. Exxon-Mobil") are another example of giant complicated companies with small portfolios.

Chromecast Audio

Chromecast Audio makes good sense - it seems like Google's approach to Airplay and so allows a phone or computer to "cast" audio to a speaker.  Apple TV and Airport Express do the same thing but, as Apple TV morphs into a more full-fledged console and given the Airport Express's wider mandate (router, printer hub, etc.), this is a reasonable slot to fill.  And the 3rd generation Apple TV is still a little pricey (and big) to act merely as a speaker bridge.

A simpler "Apple Audio" dongle could respond directly but I still think an even more interesting approach would be to take the Airport Express (and Airport Extreme - which, bafflingly, does not have speaker output) and allow Apple Music to run directly on the router rather than simply act as a bridge between the computer and speaker.  This would avoid lag and help battery life enormously.

New Apple TV (4th generation)

I understand that the new Apple TV will be available in two different storage sizes: 32GB and 64GB.  What I can't figure out is why we would need 64GB.  I'm sure there is a good reason but I can't find anything that gives the answer.  Movies, music and photos are currently streamed and that shouldn't need to change.  And I understand that apps will be downloaded in chunks on an as-needed basis so we shouldn't need to have every single app onboard at all times.

A few guesses:

1) to avoid stuttering from slow or choppy downloads.  Lots of storage will help avoid this BUT: any meaningful size should be enough and the initial download will still be at the mercy of download quality (assuming the app or stream is used immediately)

2) to use when not connected to the internet.  Maybe?  But seems weird for an at-home device.

3) to store non-internet based items.  Home movies?  But 64GB (or even 32GB) seems like either too little or too much.  Too little if you really want to use the Apple TV for storage.  Too much if it is just a temporary repository.

None of these makes sense.

A crazy guess: for people on satellite internet?

Note that none of this explains why 32GB is the base amount (although perhaps, given the 20GB app limit, perhaps Apple figured the first 10 minutes of the most likely 25 movies to be streamed could be onboard for instant start? or something similar where the device tries to predict usage and have some portion onboard?).

A small bonus question: is the memory solid state?  I assumed it was but, really, don't see why it needs to be given that the device will probably just sit on a shelf.  And I don't think I've seen any confirmation of the storage type.