Company / division: Apple
Apple Sets Its Sights on Hollywood With Plans for Original Content – WSJ (Jan 12, 2017)
Apple has been investing in video content for a while now, with the unusual strategy of pushing most of it to subscribers through a music service, rather than a dedicated video service. On the one hand, it’s a way to set Apple Music apart, and to the extent that there’s been something of a music theme to some of this video content, that makes sense too. But I still think this investment is really laying the groundwork for an eventual subscription video service from Apple, using the Music investments as cover. At this point, Apple has to get into the video subscription business if it’s to protect its ecosystem around content, much as it belatedly got into streaming music. The exact shape of that service – whether Hulu-, Netflix-, or DirecTV Now-like, is still unclear. I suspect it’ll launch by the end of this year, however, and this kind of original, exclusive content is increasingly essential for differentiation regardless of which of these models it pursues.
via Apple Sets Its Sights on Hollywood With Plans for Original Content – WSJ
U.S. appeals court revives antitrust lawsuit against Apple – Reuters (Jan 12, 2017)
This has always struck me as one of the more implausible legal challenges to Apple, and it fended off the first round through a technicality. Now, however, a higher court has overruled the technical objection and the case can proceed on its merits. I would still think it was a long shot that Apple could be successfully sued for monopolizing app storefronts for its own devices, but you never know. One more Apple lawsuit to keep an eye on.
via U.S. appeals court revives antitrust lawsuit against Apple | Reuters
Gartner Says 2016 Marked Fifth Consecutive Year of Worldwide PC Shipment Decline – Gartner (Jan 11, 2017)
This is Gartner’s quarterly press release on PC shipments for the end of 2016 (IDC’s equivalent release is here, with slightly different numbers, and definitions). The thrust is that the PC market continues to decline, with a 6.2% drop for the full year, and a more modest 3.7% decline in Q4 alone. But the other thing worth noting is that there’s a stark difference between the performance of the big players and the rest – the top six grew by 1.4% and the top five by 2%, but everyone but the top six collectively declined by 18.8% over the full year. The big players are mostly doing OK, but at the expense of a plethora of smaller players, and this is the shape of things to come, with the big question being the number of “big” players that will be able to sustain this performance – Asus and Acer saw declines in Q4, while Apple did better thanks to the new MacBooks.
via Gartner Says 2016 Marked Fifth Consecutive Year of Worldwide PC Shipment Decline – Gartner
The iPhone is gaining ground on Android in the U.S. – Recode (Jan 11, 2017)
Kantar’s data is solid, so these conclusions are reliable, and they suggest a bifurcation in iPhone market share between the US and China. It’s rising in the former, and falling in the latter, which is actually to be expected. The iPhone’s share of the market has generally fallen over time in most markets as they expand and more new buyers at the lower end of the market buy cheaper phones. But as markets mature and begin to saturate, there’s potential for the iPhone to gain share, because share is driven by switching and not by new low end users coming into the market, and that’s exactly what we’re seeing now in the US. The key for iPhone sales growth (not share growth, which is not itself important to Apple) going forward is to drive switching behavior, hence Tim Cook’s frequent references to record Android switching rates on earnings calls.
via The iPhone is gaining ground on Android in the U.S. – Recode
Apple’s CareKit apps get enhanced security option – Mashable (Jan 11, 2017)
From the beginning, Apple has been extremely careful with its HealthKit developer tools, making some really granular choices about how data is shared (my favorite example is that developers can’t even query whether or not there is insulin data, because its presence would suggest diabetes). Now, CareKit is getting end-to-end encryption for better HIPAA compliance, through a partnership between Apple and a third party (here’s the official Apple announcement). We’re going to see lots more partnership work by Apple to solve some of the thornier problems relating to both HIPAA and FDA compliance as it gets deeper into healthcare.
via Apple’s CareKit apps get enhanced security option – Mashable
Apple AirPods Topped Wireless Headphone Sales Charts for the Holidays – Fortune (Jan 11, 2017)
There’s lots of interesting data in here about both AirPod and Beats sales over the past twelve months and the holiday period. Bluetooth headphones in general have skyrocketed in terms of share, something that was happening already but was likely accelerated by the removal of the headphone jack on the new iPhone. All of the new W1-based products are expensive, and it’s not clear from the report what share of Beats sales were these high end ones rather than the cheaper ones Beats offers. But it’s a sign that at least some people are embracing the iPhone’s wireless audio future.
via Apple AirPods Topped Wireless Headphone Sales Charts for the Holidays | Fortune.com
Is Amazon late to the mobile voice assistant game? – iMore (Jan 11, 2017)
This is satire and opinion, but it’s very relevant to two prevailing narratives – that Apple is behind in AI and that Amazon is ahead in voice. Rene’s piece here does a good job of framing the discussion, and the two essays on this site which I just linked to take a similar stance: Amazon is very good at what it does with Echo, but it does a very limited number of things, and for today still does them mostly in the home. Siri has two orders of magnitude more users, but also gives users a variety of other ways to interact with their device. Any analysis that doesn’t take into account those factors when comparing the two is insufficient.
via Is Amazon late to the mobile voice assistant game?!?! | iMore
Creator of Apple’s Swift Leaves for Tesla – Tesla PR (Jan 10, 2017)
This is one of those bits of news that’s almost impossible not to see as symbolic – a top software engineer leaves an Apple that has appeared to be struggling for Tesla, the car tech startup that can do no wrong. Both of those, of course, are exaggerations and Apple has poached many employees from Tesla over the last couple of years too. But the fact that Chris Lattner, an extremely well respected software engineer, chose to leave at the very least says something is currently more attractive for him at Tesla than at Apple. If Apple’s car efforts are in as much flux as they’ve recently seemed, and if cars are what Lattner wants to work on next, then that’s not all that surprising. And it’s impossible to know at this point whether there’s something more to it than that. (Update, Jan. 11 2017: see also this news)
via Welcome Chris Lattner | Tesla
Apple, Facebook and Google top Greenpeace’s clean energy report | TechCrunch (Jan 10, 2017)
Apple has invested enormously in its green initiatives under Lisa P Jackson, arguably one of the biggest and most visible changes under Tim Cook, who seems determined to use Apple’s power for good beyond the influence of its products alone, to a much greater extent than Steve Jobs was. For Apple to come out on top of the major tech companies is still quite an achievement, though Google and Facebook also did well. It’s not clear that most consumers care all that much about any of this, but there’s an argument to be made that these companies are seen as leaders in the field, and Greenpeace’s endorsement puts pressure on others to fall in line, which has broader environmental benefits.
via Apple, Facebook and Google top Greenpeace’s clean energy report | TechCrunch
MacBook Pro Ratings Changed – Consumer Reports (Jan 10, 2017)
I changed the headline on this piece, which is a bit of amazing spin. Following serious pushback from Apple on its MacBook Pro battery tests, Consumer Reports provided more information to Apple on its testing process, and it emerged that it had turned off the cache (which consumers never would) and this in turn triggered an obscure bug which drained battery life. Had CR simply given Apple the opportunity to provide feedback on the testing process, this whole thing could have ended a lot earlier and without the unjust criticism. To the extent that anyone saw this story as evidence of slipping standards at Apple, that should now be laid to rest. For what it’s worth, I’ve seen excellent battery life on the MBP the last two weeks while traveling, especially with the screen dimmed somewhat. (See also Apple’s full statement.)
via MacBook Pro Ratings Changed – Consumer Reports
Apple and Zeiss Working Together on AR Glasses – Robert Scoble (Jan 9, 2017)
Robert Scoble is an odd source – not strictly a reporter, and one with a very mixed track record when it comes to this kind of thing. So take it with a pinch of salt, but this is an interesting report given that Apple does seem to be very interested in AR. The timing is interesting here too – Scoble says the glasses might launch this year, which would be a big new product for Apple when it could really use one to reassure the faithful.
via Robert Scoble – Exclusive news: Apple and Zeiss working together…
Why Apple’s Critics Are Right This Time – WSJ (Jan 8, 2017)
This piece rehashes all the recent stuff that’s been said about Apple without really adding anything new. AI is mentioned a few times, and that’s the ostensible focus, though it’s not clear that AI is really what’s meant – it’s mostly about voice assistants specifically, and this article repeats a lot of the prevailing narrative about Amazon being ahead in voice, a situation that’s significantly more nuanced in reality. But in some ways the key point here is that we’re starting to see a steady drumbeat of this kind of thing lately, and that’s notable in its own right.
via Why Apple’s Critics Are Right This Time – WSJ
KGI: 3 new iPads to debut next quarter will slow decline in sales, 10-10.5 inch model wildcard | 9to5Mac (Jan 8, 2017)
The iPad had a better year in 2016, but shipments were still down 10-15% year on year, while revenues were down by a few percentage points. I believe revenues will likely level off sooner than shipments due to higher ASPs driven by the Pro models, while shipments will level off over the next year or two as well. New iPads which provide more compelling reasons to upgrade will help with that, but a lot of sales will be driven by replacements among the massive installed base of older models. The new models reported by KGI are intriguing – at least one new size will make an appearance, and it appears this will be the high-end version of the 9.7″ model, which will remain at a lower price point.
Apple Watch Sales Were Way Up Over The Holidays, Slice Data Shows | Fast Company (Jan 6, 2017)
Slice is one of those data sources you can’t completely trust – because the data is about online purchases only, it’s partial, and it’s also only ever directional. But this data suggests decent growth year over year for the Watch, which is in line with Tim Cook’s fairly vague but positive remarks on sales recently. The Watch should have sold well over the holidays – the second generation launched shortly before with some new hardware features (and better software), the base price is now cheaper, and there were deals on several models over the holiday shopping period. We won’t, of course, get hard numbers from Apple, but there should be enough in the reported results of the Other Products category to check if this is true come the end of the month.
Apple camera lens manufacturer posts significant profit, shedding doubt on iPhone order cuts – Apple Insider (Jan 6, 2017)
This is only one data point, so take it with a pinch of salt, but it suggests healthy sales for the new iPhones in Q4 2016, in contrast to the recent reports of manufacturing cuts by Apple at its major suppliers. We’ll know soon enough when Apple reports its results for the quarter, but I’m still expecting some decent year on year growth and a fairly bullish outlook for the March quarter.
via Apple camera lens manufacturer posts significant profit, shedding doubt on iPhone order cuts
Alexa, when will you work well outside the home? – The Verge (Jan 6, 2017)
This piece highlights what I still see as the biggest challenge for Alexa – for the most part, it’s not available outside the home, and where it is the experience is sub-par relative to the Echo. That’s really important because I think a lot of people are mistaking Echo’s superior performance as evidence of better voice recognition or natural language processing rather than a function of its form factor. Put it in a smartphone or watch, and it will likely perform just as poorly as other assistants in those devices.
via Alexa, when will you work well outside the home? – The Verge
Russia Requires Apple and Google to Remove LinkedIn From Local App Stores – The New York Times (Jan 6, 2017)
This comes hot on the heels of the Chinese New York Times app story earlier in the week, and there’s a danger of this becoming a trend. Apple and Google both tend to comply with local laws when it comes to this kind of thing, and that’s certainly a reasonable defense. But if oppressive regimes start to use the major app stores as a way to block content they don’t like, Apple and Google are going to find themselves on the receiving end of attacks from lots of civil liberties groups.
via Russia Requires Apple and Google to Remove LinkedIn From Local App Stores – The New York Times
Apple’s Search Ads Are Generating Conversion Rates Higher Than 50% | Adweek (Jan 5, 2017)
The numbers in this article, which appear to come straight from Apple, are fairly impressive – half of those who click on an ad in the App Store end up downloading the app. That’s measuring conversion rate differently from the usual method, which would be downloads / impressions, rather than clicks, but it’s still high. And the average cost is low too – 50 per click, and $1 per install, much lower than, say, Facebook. Advertising is never going to be a significant chunk of Apple’s revenue, but this could turn into a nice little revenue stream over time, and it has a lot in common with Google’s search advertising, combining timeliness and relevance.
via Apple’s Search Ads Are Generating Conversion Rates Higher Than 50% | Adweek
App Store Shatters Records on New Year’s Day – Apple (Jan 5, 2017)
These new numbers from Apple reinforce the sense that Service revenues, driven largely by the App Store, continue to be the company’s most consistent growth driver. Payments to developers were up 40% on 2015, for a total of $20 billion, while subscription billings alone were up 74% to $2.7 billion, or almost 10% of the total. That 40% year on year growth rate is fairly consistent over the past year or two, as the rise of IAP accelerated growth above levels in 2012-2013. All of this also reinforces Apple’s argument to Wall Street that Services will grow even as device sales falter.
via App Store Shatters Records on New Year’s Day | Business Wire
Apple community reacts to lack of Mac Pro – Business Insider (Jan 4, 2017)
The version of this headline on BI’s site is much blunter, and the gist is that Mac fans are ticked about Apple’s lack of upgrades for the Mac Pro. Some see this as a sign of broader issues at Apple, while others see it as merely a side effect of Apple’s tendency to focus resources on a small number of products at once. I do think the Mac Pro boxed Apple into a corner somewhat – having boasted about the US manufacturing, it likely finds it difficult to back away, but I suspect it may regret some of the form factor choices – the lack of upgradeability means Apple needs to update the computer more frequently, something it hasn’t been willing to do. I think we’ll see an update in 2017, but I’m really curious as to what the new version will look like.
via Apple community reacts to lack of Mac Pro – Business Insider