Upgrade - 227: Twenty Nine TeeVee

Episode Date: January 7, 2019

The new year starts with a bang, as Apple misses its iPhone sales forecast and announces surprising partnerships with Samsung and other TV makers in advance of the launch of its new video service. We discuss these earth-shattering issues in detail, not to mention Jason's world-exclusive trial of a new iPad Pro keyboard.

from relay fm this is upgrade episode 227 today's episode is brought to you by fresh books hollow and lunar display i am very excited that we were back to normal my name is mike hurley i am joined by jason snow hi jason snow happy new year i like happy new year i like the the usual upgrade theme i like the special themes too but it's it's nice to have the regular upgrade theme back and back to a regular show segmented beautifully episode that we have for you today that's right there's no there's no awards being handed out no ghosts will visit probably uh it's all for the best so we do have some follow-up actually about our special episodes which we'll get to in a moment but we must institute regular uh format rules here so we have a hashtag snow talk question that comes from

steve steve wants to know jason what is your favorite taco taco they are i didn't think about the fact that this is a word i cannot say um but what is your favorite say it again taco taco taco taco there's no good way for me to say it because if i say it it's like it's like talk oh yeah but the thing is if i say it like a british person it sounds ridiculous if i say it like an american i sound ridiculous too would Would you like a taco? Taco. Taco. No, it's taco. Taco. I, well, this is an interesting question. Congratulations, Steve.

I don't know if I have a favorite taco. I grew up with the most, as is typical of the stuff made by my mom, the most Midwestern of Mexican food, is typical of the stuff made by my mom, the most Midwestern of Mexican food, which is a hard shell with ground beef and a little bit of quote-unquote Mexican sauce in it with some cheese and lettuce on top. And you know what? That is comfort food.

I still like that, and we have that occasionally here at home. But we also have soft tacos a lot. I don't love corn tortillas. I prefer flour tortillas. I know that that's heresy. But it's just the way it is. I prefer the flavor of flour to corn.

Yeah, that's it. It's about the flavor. I don't love the corn tortilla flavor in a soft taco. The hard tacos are corn too. But it's different there. And there's a place in mill valley called joe's taco lounge that um is good and they make uh these uh shrimp tacos that are uh little fried shrimps so they're like little prawn little breaded shrimps uh and they're really it's really

good so i think i might say that is that the place you took me to uh's taco lounge no no you went to the fans we took you to the fancy mexican restaurant very nice that we never go to because it's too expensive no joe's taco lounge is a dive it's great um but it's a dive so yeah that that i'm gonna say that i'm gonna say the shrimp uh shrimp tacos from joe's taco lounge but uh you know honestly all tacos are my favorite that's my answer all tacos are my favorite. That's my answer. All tacos are my favorite. I love all tacos. I am a native Californian.

If you'd like to send in a question to open a future episode of Upgrade, just send in a tweet with the hashtag SnellTalk, and you may be picked. Thank you to Steve for Steve's submission today. We get to follow up. So the holiday special was great. We were really pleased with how it came out. People seemed to really enjoy it which is awesome but i wanted to uh direct people to a youtube video created by hm boutette who is responsible for cortex animated he does some animations for cortex uh they did an incredible animation of the introduction of the episode it is well worth

your 1 minute and 18 seconds to watch i agree i was very impressed i did have that moment where i looked at it and said i look nothing like the animated jason in this yeah and then i looked at the animated mike which is the same animated mike from cortex animated and i said but mike looks nothing like animated mike either so it's fair actually stephen hackett looked the most like his animation of all three of us. And he was in a doorknob. So the way that I understand it is that this individual, they kind of create their own versions. So like, yeah, they're very, they're a very talented individual. But they basically create versions of us based upon how we sound as opposed to how we look. But with influences of, it's a style and I love it.

And this video is amazing. Yeah, that's really what I was getting at. I had that moment of like, wow, I i love it and this video yeah no and that's yeah that's really what i was getting at is i had the moment of like wow i don't look like this and then i looked at mike which i've seen in countless cortex animated videos before and said oh yeah mike doesn't look like that either it's fine these are characters in an animated thing and it was really cool i've never had any thing like that uh for anything that i've done before so that was awesome uh also i wanted to just recommend again in case people didn't go to Upgradees.com because there were spoilers if you hadn't listened,

if you hadn't listened to the episode and hadn't gone to the site. I'm very proud of this project that me and Zach worked on. And I think it's worth going, checking out. We have all of the answers for every winner, every runner up of every Upgrady in all time is now on this website, and it will continue to be updated in the future.

So that is a resource that is there for you in case you were wondering, who did win Best Mac App in 2015 as the Upgradies? Well, you will now know because it's there for you at Upgradies.com. And if they find any errors, who do they email? Do they email you? Do they tweet at Upgrade.fm? What happens? Just let me know i'll just just let my somehow let me know and and we'll

get it taken care of it's just because we had to compile from all the history this year so it's there yeah it was a tricky thing but yeah if anybody does have any things that don't look right just let me know and we'll get them fixed and whilst we're mentioning the upgradies the upgradey award winner for the best movie of the year was Spider-Man Into the Spider-Verse, which I saw yesterday. I told you just to trust me on this one. Yeah, you were right, Jason Snell.

Oh my God. Oh my God. No spoilers. I'm not going to talk about the movie, but I loved it. It was my favorite movie of the year, even though I saw it in 2019, but whatever, it's a 2018 movie.

I can't believe how good that movie is, Jason. It is unfathomable how good it actually is. It is. I feel like I have to once again explain to people, because I was deeply skeptical, and I love Spider-Man. It's one of my favorites. I was deeply skeptical when they announced this. But it is the best animated movie of 2018. It is maybe the best Spider-Man movie ever. It is one of the best superhero movies ever made.

It is all of these things. It is a really great movie. In fact, if you don't usually watch animated stuff, or maybe you say, well, I might watch the Pixar's, but that's it. You should watch this because this is going to beat out the Pixar's for the Oscar for Best Animated Feature, and deservedly so. It is an astounding achievement and also a crowd pleaser. So it looks great.

It's got a great story. So I know you're skeptical, but if you get a chance to see Spider-Man into the Spider-Verse in theaters especially, do so. I'm glad you liked it. I absolutely adored it. i cannot wait to see it again um yeah me too i hope it's not too long before it comes out on on a home video um i also wanted to give a shout out some follow-out jason to mac power users 464 because i am very proud of my co-founder stephen hackett as he has taken the reins from Katie Floyd who decided that she wanted to move on to different projects and Stephen has taken the reins at request of the host of the show they wanted Stephen to take over and he did his first episode yesterday and it's

really really good and I miss Katie already but I'm also really happy that Stephen's taken over the role because I think he's perfect for it and the episode episode's really good and you should go and listen to it. All right. See, I thought you were going to say you should listen to MPU 462, which has got a really great guest, who is me. But no, it's Stephen's first episode.

I guess that's important in the great history of Mac Power users. But yes, Jason, you're very important too, Jason. I'll make sure to put your link in the show notes also. In the great annals of MPU history. They had to come up with a new name because it's like my third time. So they can't even call it Jason Snell Returns anymore. So I think there's something about the Snell Zone in there.

Yep, return to the Snell Zone, which is, I love when I saw that episode. Oh, I was so excited. Yeah. It's great. Anyway, congratulations, Steven. Steven's now in the uh in the spark zone so jason we made a promise in our upgrade this episode that we were going to talk about the upcoming new keyboard from bridge the new ipad pro keyboard because you got a world exclusive hands-on i did i did I realized I should probably have put

like an all capital letters exclusive and I didn't. I didn't do that. Can you explain to me how this happened? Because there is a kind of, there's a fun story about this exact model. Well, I mean, they contacted me and said,

we're going to be showing it at CES, which is this week. But our CEO, you know, we have a test unit unit it's not a final production run but we have a test unit and we could send it to you over the holidays which is not the most ideal time but you know we could let you have it for a week and you could be the first one to write about it and then you know we'll let some people get their hands on it at ces and i said sure like yeah i'm not going to turn down an exclusive.

You had a lot of pressure not to break it, right? Well, I didn't, you know, I was actually really concerned because the FedEx guy didn't come until late in the afternoon on the day that I was sending it back to them, which was the day we agreed I would send it back. So they got it back in time and all of that. And I started to get a little nervous, like, oh no, what if I ruin their CES plans by not having, by the FedEx guy not coming? And then the FedEx guy came. It was fine. But yeah, so I got my hands on it.

I got the Bridge 12.9 Pro, which is their new version of their keyboard for the iPad Pros from 2018. And I got to spend, I did spend a week with it. And then I had to take it and put it in box and send it back and go back to my other keyboards. And that made me sad. Yeah, so tell me why did it make you sad? had to take it and and put it in box and send it back and go back to my other keyboards and that made me sad yeah so tell me why did it make you sad like what what did you what was your overall kind of impression about this new model the bottom line is that it is this was already my favorite keyboard for the ipad pro for the last generation they had a bunch of production issues with their first generation version they did a second generation version of the old model uh that changed the keyboard slightly um it's still a good keyboard

it's still better than the keyboards that apple ships uh they're they're you know they move they're clicky i guess they're less stable so if key stability is your number one thing uh but they're they're good it's a good it's a good keyboard i recommended it to people that second gen seems to have been reliable. Everybody who I know who's picked one up has been happy with it. You know, this is that keyboard where it's got little, it's like it turns your iPad into a laptop temporarily. You slide it into these two little clips. And at that point, you've got your iPad as the screen and the keyboard deck is the bridge keyboard.

And they're connected. And you can, you know, put it at any angle and put it in your lap and it's like you're using a laptop and but but the great thing of course is you're using an ipad and the moment you don't want to use it as a laptop anymore you just pull it off and it's an ipad again uh that's the always the question we get right is why won't you just use a laptop and the answer is well i can't pull the screen off my macbook and have it work i really like that argument by the way you have given a very nice succinct argument like to that point now which is just simply like well i can you rip the screen off yeah right i mean it's like i will agree if you spend all of your time with a bridge keyboard then there is at least a little more

relevant question about why wouldn't you just use a MacBook? The answer is probably that you prefer iOS at that point. But for me, the answer is because the reason I love using my iPad Pro is because I can use it as a laptop when I want and as a tablet when I want, because it's truly convertible. And Apple doesn't make a convertible laptop. That's not what they, that they don't do that. So the bridge keyboard does this for me for the iPad. They also have them for like the Surface and for the, I think they're doing one for the Pixelbook. And the big question with the iPad Pro 2018 was the clips, the bezels, the clips go on the corners at the bezels. And of course the bezels are much smaller

on the new iPad. So there was a question like, are they going to be able to make this work? And in my week with it, the answer is yes. These clips, which are kind of rubber padded so they don't harm the iPad and they hold it in place and it seems very solid and I can tilt it and put it in and take it out and all of these things and it just worked fine. I wrote this thing and posted it on Twitter and it out and all of these things. And it just worked fine. I, I wrote this thing on and posted on Twitter and I had a bunch of people asking, and a lot of them were very concerned about like, will this scratch my iPad?

Will it break my iPad? Will it do weird things to my iPad screen? And like, I don't see any of that just as I didn't see it with the last model. It just, uh, it works like the old model does. There's a little more precision may be required,

um, to slide it into the clips, but I actually don't think there's that much more precision because you always want to be precise sliding this thing. And it takes a couple of tries before you figure out like the right approach for it, because what you want to do is get it lined up perfectly anyway, so that when you close it, it just is like a laptop. And if you do it haphazardly you'll get it where like the top is shifted off a little bit from the bottom which is not great so you

you have to learn sort of like the right way to make it all uh fit together but uh you know a couple a couple attempts of that and then you figure it out so like day one i figured out this is my approach to get it in there and then it's just kind of second nature after that and then at that point yeah i i took this to the local uh the local cafe to write some of my columns and you know i'm carrying a laptop in my hands essentially and i and it's it's designed to match the style that was the challenge for them uh because i think internally it's basically their last keyboard the difference is that it's got like those straight edges with you know the flat edges with the curved sides at the corners and it's physically smaller too right

yeah yeah so they're losing a lot of side space just because they lose the same size it's an exact match for the screen and on the 12.9 the uh the bezels all shrunk in so now the keyboard shrunk in uh it it's almost exactly the same size as the in. It's almost exactly the same size as the iPad. It's almost exactly the same weight as the iPad, which means, yes, it's double the weight of the iPad alone, if you have it in this case. It's still a little bit less weight than the MacBook Pro. So it's actually lighter than the MacBook Pro, and of course, you can take half of that weight off whenever you want. it's actually lighter than the MacBook Pro and of course you can take half of that weight off whenever you want but it looks really great

when it's closed because you know that iPad looks very laptop-y styling already and then you put the keyboard on and then it's that styling in a laptop configuration which it looks pretty nice and they actually put a little divot

in down by where the trackpad would be if it had a trackpad That's a really nice addition. Yeah, because that was one of the challenges is how do you kind of like get your fingers around it to open it up? And now there's that little divot. You just peel it open there and it opens up into laptop mode. Let me ask you a question. I don't know if you have the answer to this, but like I noticed that the divot is in the exact place where the induction charger is for the pencil. I assume it's pretty fiddly if you have the pencil attached and open it now right yeah i i yeah absolutely i mean i think the nice thing about

the pencil is uh when it's open it's hanging out up there when it's closed it can hang out there and it's not a problem um when you want to open the laptop and you've got the pencil attached you should probably take the pencil off yeah um but it's it's okay i mean you really put it in your hand open it up and snap it back on yeah so there is that uh but that's just sort of i mean there's no other apple designed that pencil location as the surface that's not attached to anything and then you close a laptop and that's what you get so yeah i don't think it's a big deal i mean maybe they would do this in the future like they could put they don't need to put that that divot in the middle it could be on the edges or like you know like at the at the corners or something right i suppose but you know it's not the end of the world but like it's just something

i know that like art is gonna bug me i can see yeah it's if you've got if your if your pencil is riding with your i don't use the pencil in mode, so it's not a big issue for me. But if your pencil is riding with your iPad all the time, it will be, I mean, I would say you can also just open it from the sides like you do the previous generation in that case. Which is probably, you're not using,

you're not using that, the advantage of that little divot thing there. You may also be able to find that like with the right finger, you know, kind of like with your thumb hooking under or something, you can do it and keep the pencil, like little magic trick keeps the pencil secure as you open it i don't know i will say like just from a from a visual design perspective like from the pictures that you've taken it looks like that the hardware they have done a much better job at like keeping

up with the ipad like one of the great things about the this ipad is how incredible the hardware looks and it looks like bridge have done their absolute best to match it and i think that that is quite an achievement from them yeah uh it they did a good job um it's not shipping until what they say is early spring which is a lot a long time but and i had a i had a guy who said that you know oh that's terrible it should be shipping now and i'm like well that that it's so easy to do it's one of those things where it's like oh this is very to do, says the person who doesn't do it. And I talked to the CEO about it and they're like, to do this, they really did need to see it. They needed to match the materials because they want to match all the colors. And the colors changed,

by the way. They want to match all the colors. Well, the color, right? They didn't the gold? Is there a gold for this one yeah i mean no not on the ipad pro right i don't i don't even remember i live in a space gray world is it just space gray and silver anyway they have to they have to match the colors they want to match the anodization they want to match the edges and somebody was like well you know there were leaks beforehand for cases and stuff it's like i don't know would i want to finalize and start building stuff on a product I'd never seen? This is a very small company. There's no way they're going to do that. And as

a result, we're not going to get them until early spring. But I'd say for people who are using the, or have used the most recent Bridge keyboard on the other iPadad the previous ipad uh this is basically that except in the shape and size of this new version uh still bluetooth because the the guy who was armchair quarterbacking uh bridge also said well why why not just use the smart connector and the answer is then you have to build like a little thing that climbs up to the smart connector and you know it's just like bluetooth the bluetooth is fine this also has the benefit this time that you they said this i mean i know you didn't get to test this but you can plug it in via usbc now to charge it which is amazing

and to use it so that addition by the way i'm really pleased that they did that it's because now i never have to think about charging it or I'll always have a USB-C cable around and I think to charge the keyboard and I think I charge it more often than you do because I use backlighting and you don't. Right. But now I can just plug it in and keep using it while it's charging,

which is, that is really cool. I'm pleased that they've made that addition. I can't wait to get my hands on this. And thank you to Bridge for sending it to Jason. So we got to talk about it early. Yeah. And the final comes out we'll check that out too and yes i can i can officially say before everybody writes in yes silver and space gray are the only options here but bridge does this color matching stuff so they want to make sure that they got the they've got all that right space gray changed like there is no real space gray

it's not a not an international standard, no. So anyway, yeah, I liked it. It's good. It will become my go-to keyboard again when it ships. And in the meantime, I'm back to having the smart keyboard folio for some stuff and external Bluetooth or USB keyboards for other situations. And I'll just, you know, I'll muddle through somehow.

But I'm looking forward to getting the real. I'm going to get both of them. Because I want to use the small one just when I'm traveling. I didn't get a chance to see the 11-inch model. And I imagine it's going to be, you know, it'll be better than the old 10.5-inch because it'll be a little bit larger. No, it same footprint right with a bigger screen so it'll be the same as the

uh 10.5 except with uh some different clips and stuff but that should be good too that 10.5 one was good good uh good device too and oh by the way cheaper than the smart keyboard folio really not not a lot it's about 20 more expensive than the last version of these keyboards but it's also still cheaper than buying a smart keyboard folio because the smart keyboard folio is really expensive yeah yeah okay can't wait today's show is brought to you by hello who make insanely comfortable buckwheat pillows they're very different to fluffy pillows because buckwheat pillows do they do not collapse under the weight of your head they support your head and neck and this is super awesome i as i

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And thanks to Hullo for their support of this show and RelayFM. Time for some upstream news. But upstream this week is one very big, very important topic. So CES is going on right now. And CES, one of the big things, one of the big things that remains at CES is television news, like actual TVs. Lots of companies have pulled

out of CES over the years, right? Because they want to have their own events and stuff. And lots of different types of technology are mostly ignored. But CES is where the TVs get shown off. And this year, Apple is all over the news in a way that I don't think we would have ever expected. There's two different things going on here. The most important of these is what Samsung is doing. So Samsung announced that beginning this spring, all of their 2019 TVs that go on sale, the 2019 TVs, that's an interestingly difficult thing to say. Let's just say it's 29 TV. There you go.

I love it. And all of their 2018 models will get an update to add AirPlay 2 and apps for the iTunes Movies and TV Store. You can watch your past purchases and buy new iTunes content on your Samsung TV. All of this content is integrated into the TV. You'll see it in the Universal Search and Bixby for some reason. This is wild.

Woohoo, Bixby! That's our story, people. The big news of the day, bigger than any news ever, is finally iTunes is coming to Bixby. It's what we've all been waiting for the day and here it is man yeah yeah i mean just like who i'm pinching myself now i cannot believe itunes is coming to bixby at last wow but the thing is we make a joke that sentence doesn't make any sense right like oh you'll be able to ask bixby for your itunes content that's wild i mean the idea that the sam Samsung TVs, and it's the 2019 TVs,

and the 2018 models with a firmware update, right? So this is the platform that Samsung is using, which is what, Tizen. They have an app, whoever, you know, did they build it? I loved it. I didn't realize this. I saw Dieter Bohn kind of reference it. It's like, hang on a second. This is a Tizen app, right?

A Tizen app? Yeah. Yeah, I mean, who knows? But it's, yeah, so this is fascinating because it's AirPlay 2, which means that if you've got any Apple device, you can shoot basically anything over to your Samsung TV. But the app thing is also interesting because that's more complex right because that now they're having to build in

something and it's this itunes app for movies and tv although as we're going to talk about very strongly hovering in the background is apple's forthcoming video service right like that's like it's yeah it's great you can rent a movie on itunes on your samsung tv and also apple's video service will play on it so there's a quote from eddie q in samsung's press release um says we look forward to bringing the itunes and airplay to experience to even more customers around the world through samsung smart tvs so iphone ipad and mac users have yet another way to enjoy all their favorite content on the biggest screen in their home. I just love that Eddie was in that press release. It just made me smile. So I thought

that I kind of had this news all locked down, right? It's like, okay, so some TVs are going to get all of this stuff easy, easy peasy, right? But then today, more stuff started happening. So Apple updated the AirPlay 2 page to focus on some additional features coming soon to airplay 2 that ties in with all of this they mentioned leading manufacturers getting airplay 2 and then more news has come out vizio and lg have both announced tvs but their tvs just have airplay and home kit support they don't have the itunes app that samsung has right which that adds some complexity to all of this because i thought oh we got it on lock right like it's exactly what we thought was going to happen apple's going to have an app on all of these providers smart tvs and it's going

to come to fire tv and that's how to get their content out there and that may still happen but for some reason maybe samsung has some exclusivity or whatever. But it's added like a wrinkle in all of this. So it's amazing to see that AirPlay 2 is getting on all of these TVs because that way it doesn't matter whether Apple has an app on them or not. You can just throw the content over to the TV, and you'll be able to use Siri on your phone. So you'll say like, ahoyoy telephone send this on my tv or whatever watch this on my tv play play the play jennifer anderson and reese witherspoon's tv show

on my tv set yes and then also there's going to be what apple calling new convenient built-in controls to let you control media and the volume of the tv it's kind of unclear like the way that this like is read it might be new UI that appears somewhere. I took that as being that it may be in the lock screen or in the TV app that there'll be some controls that will also

talk to the TV and let them control the volume and all that. It may just be a UI update to existing functionality, but it is very interesting to see these two things split apart i think it's hard to tell from the outside whether this is something that is contractual something like samsung gets a period of exclusivity clearly samsung got to be first out of the gate that was part of the deal um and it might be that i mean maybe it's like samsung said we'll build your app if you give us the first drop on this or something like that.

Because I was thinking about Apple in terms of Major League Baseball. When I went to see their offices, they have this whole development group. group and they have to build the mlb app for like smart tvs and playstations and ios and apple tv and xbox and right like all of these platforms they have to build it and roku right and fire tv and it is interesting to think about like well what's apple gonna do and like apple could totally do that but a different i think i don't know enough about these boxes. Like I think there are different models. Some of the models are you write the app. Some of the models are the vendor writes the app.

Sometimes it's sort of like the old Apple TV. I get the impression that you can do like a generic thing where you're basically like filling out a bunch of configuration files and there's just a generic media player app. Although that doesn't sound like something Apple would want to do, but it might get them on more platforms. So I'm not clear. out a bunch of configuration files and there's just a generic media player app uh although that doesn't sound like something apple would want to do but it might get them on more platforms so i'm not clear yeah and there hasn't been a demo of this by the way so like samsung's tvs

they're showing uh that are in ces right now for as much as i've been able to work out they are showing like a placeholder but there is no app to actually go into yet well and there's a question about when this all happens and when this update happens because one possibility is that this is all being announced but by the time it ships it will be something different right if the apple tv launch happens then this may be all designed that app may be designed to just flip over and become the apple tv like that actually will never be an iTunes app. Yeah, like Singular never shipped on the iPhone, right? Because it rebranded as AT&T by the time that it shipped,

even though it was Singular when they announced it. Yeah, and so I would be surprised if there aren't iTunes slash Apple TV apps on other boxes or TVs down the road. But there is a question of like, can they do it? What goes into that? Like what goes into building an app for Vizio or LG? And can you add it after the fact? Or can you not?

You know, and I don't know. It's also possible that Apple is only bothering to do this with bigger players. So like Samsung will get it. Amazon will get it. You know, maybe Roku, like an actual app. Everybody else, you AirPlay. Yeah, it may be.

And in the end, if what you're saying is, hey, you've got one of these TVs and you've got an iPhone, you start playing it and say, go to the TV. And then your iPhone, the AirPlay 2 experience, your iPhone just looks like your iPhone. It's not like your iPhone has to sit there and mirror the video playback or anything like that. You kind of like send it over there and then it's gone. And that's good. You can keep using your phone and it's also streaming video to your TV and it's all fine.

So I think it's good. I think it gets Apple content on all of these TVs without people having to buy an Apple TV. And that's really the big deal here. I've heard, you know, there are definitely a lot of people who are like, well, why is this a big deal? iTunes is on Windows and all that. It's like, yeah, Apple has kept the crown jewels of their video stuff locked down to playback on Apple devices. And if you want to play it back on a TV, you need to use Apple TV or like an adapter out of your iOS device, right? Those are the ways that you do it. And with this, Apple is in the prelude to launching their TV service, Apple is opening the floodgates, which is like, nope, we want Apple TV, Apple video content to be available on as many devices as possible. And you don't need to buy an Apple TV box to do it,

which is something we've talked about. I feel like upgradians are very prepared for this sort of story because we've been talking about this for a while now. And the idea that as with the Amazon Echo story, where it's like, well, what does that mean for the HomePod? And the answer is, well, the HomePod will continue to be a premium hardware product with high margins that's got that Apple stamp of approval for people who want to buy all apple stuff but you can

also now get apple music on uh the echo and this is like the same thing right which is like i think the apple tv is still going to exist as this high-end product that is all apple through and through but that's not enough like apple wants their video stuff to be available more broadly. And it seems like they've got people out there really pushing all the TV manufacturers so that all these modern TVs and presumably video box platforms too, are going to be able to play Apple stuff either via AirPlay or an app because they want to be everywhere. They want the video service to not just be for people who have Apple devices, especially since a lot of people still want to watch TV on a TV set. And Apple, that has been a huge barrier. Even if you've got an iPhone, I don't want to watch

TV shows on my iPhone unless I'm really desperate, right? Especially if I'm at home and I've got a 65-inch TV. I want to watch it up there. How do we get it there? And up to now, Apple's been, well, you pay us a lot of money for an Apple TV. And as of 2019, Apple is saying, nope, we want every TV and every box that we can think of, presumably, there'll be more announcements to come. I'm kind of assuming that this will be true

to play our video stuff because they're going to be charging people and getting people to sample and then pay for their new video service. And they want that to be the broadest audience possible. Yeah, I mean, we're seeing these announcements now, but I really feel like it is a lock that it gets on Fire TVs. That just feels like a lock to me because of Apple Music and Echo. Yeah, you get the sense that Apple and Amazon last year came to an agreement about a lot of things.

Yeah, a series of agreements. Right. Which was, again, as we spoke about on this show, was like it was probably, you know, they settled all family business on that day. Everything was taken care of. You know, now we'll sell your products and you'll give us your music and TV and then we'll give you the app that you want for your Apple TV and like fun, fun, fun. We're all good again. This is super interesting to me. I mean, I've been running this idea around in my head and I feel like it seems pretty clear to me at this point that the company that we know is changing in some very significant ways.

You know, like Apple is making some very big changes. And whether or not this is something that you like, or whether you feel it's in their best interest or not, at this point, it kind of doesn't matter because the train has left the station. They have spent and are spending billions of dollars on creating television shows and i totally understand a lot of people's position that this is not the company that they know i get it it's super weird this is why this segment exists because we find it interesting but also super weird and we like to talk about it right like apple is doing all this stuff which

doesn't make sense also i saw a lot of people arguing that they just don't think it'll be successful and they think it's a bad move and that is a perfectly reasonable opinion to hold i don't know if i agree with it but i'm not convinced it's going to be successful either i'm i'm not sure what how this is going to go but uh like you said apple has already gone down this path. Yeah, it doesn't matter. I looked it up. They made their big thing where they released a whole appendix to their quarterly earnings report talking about services revenue. That was their blowing the horn of like,

watch services revenue. It's growing. That's our next big thing. You know when that was? That was January of 2016. That was three years ago. Apple has been on this track for three years publicly and probably for longer privately. And the TV execs have been there for a year and a half. It'll be almost two years by the time they launch this thing probably and this is this is this is apple changing what it's doing to be more because they believe that uh there's an opportunity here for revenue growth and they believe that in the in this era that if you're a tech company that doesn't own a piece of this kind of content stream, then you lose some power. And again, they're looking for places where they can move the needle in terms of revenue

growth. And a lot of skepticism about whether Apple can be a true Netflix or Amazon Prime Video competitor or a competitor to Disney Plus. And I think that skepticism is valid. But if you look at the bigger picture here, we are entering, as Tim Goodman says on the TV Talk Machine podcast that I do with him, times of confusion, right? Where there's so many shows out there and there's so many services and there are more streaming services and we're entering this period where everybody is doing a streaming service and most of them will probably fail because it's a gold rush right now.

Yes. But as with the iPhone, right, where if you are one of the few left standing that has a very profitable business in five years as a video streaming provider, you have valuable real estate that is impossible to, you know, that will be worth far more than what you spent on it. And that's, we're in the land rush territory here and Apple may not make it, but that's why Apple's doing this is there is a huge opportunity because if they're one of the four or five, if they can spend a few billion dollars a year and create the next HBO, it doesn't even need to be the next Netflix per se, but it could be, or the next Hulu. If Apple can do that and become one of the ones that sticks, that will be a profitable long-term business that will provide them revenue

growth over the next five years. And that's why they're taking their shot. And they've got lots of cash. And when you've got more than $100 billion of cash, you can spend a few billion dollars on a bet in an area that seems like there's a chance of a big payoff if you end up being one of the services that's left standing in a few years. And that's what they're doing. And it may not work, but they've been on this path for quite a while now. And I think, again, not to toot our own horn too much, but I think upgradians have heard us talk about this. I think everybody listening to this podcast knows that this has been a path that they've been on. So at least it hasn't, you can disagree with it,

but at least it hasn't taken you by surprise. They've been on this path for a while. Like this is a, even if this is an absolute failure, this is like a three-year thing we're going to go through, even if they stop. Because they're in agreements, they've got stuff, and you know, they've got all this stuff, they're signing all these shows.

There's multiple years worth of content that they've currently got signed because it takes a long time to make this stuff. This is going to become a thing they talk about all the time. Every presentation that they do, every keynote, is going to include something to do with this. There's going to be lots of celebrities coming out on stage. We're going to see Steve Carell. He's going to come out and talk about his show. This is a new thing for them.

If you really didn't like when you saw a bunch of celebrities with the Apple Music thing, get used to it, friends, because it's going to happen. This is about to become a very big part of Apple's strategy. And again, I don't know if it's right or wrong, but my personal belief is this is a thing they need to do this is the thing that they should have done a couple of years ago this way right because the carpool karaoke thing the planet of the amps thing was a dumb idea they did it badly and they

put a bad taste in everyone's mouth that is what happens when when um tech guys try to program content because that's what that was right like it was it was people from inside of apple and some of the people from apple music who were not tv people but music people and they tried to make some shows they they tried to like buy in on carpool karaoke but did it in the complete wrong way because it should have had james claudin if they were going to do that TV show, right? Like they messed it up. So what did they do? They spent a lot of money hiring really credible people. We don't know what these shows are going to look like, right?

Like we've heard, we spoke about, and I've seen this, Christina Warren made a really good point on Twitter to us about this, right? About like, are these, are they going to have too much influence on it? Are they going to stop any explicit content? Yeah, maybe. But that also doesn't mean it's going to fail it just means it might be not what you expect the big question is uh and she's christina's comment was she's a little worried about like meddling from the tech guys like okay they hired the pros to do this but what if tim or eddie or

somebody else at apple is like i've got notes about this is Tim. I have notes about what Reese Witherspoon is doing, right? Like what? I think that's a problem. I'm not sure the no explicit content, expensive NBC kind of stuff is necessarily the kiss of death. I don't think it is. I really don't think it is. Because there are levels that you can program at and you know disney plus is not going to be programming at hbo level uh or netflix kind of hard you know rated r kind of stuff there there is an audience for it that is different um so if it's done well then it could be a interesting brand position for them here's why i think it's not an issue about like this the explicit content stuff is i don't watch completely all explicit content 24 7 right like

this is not a thing that i do yeah you know like i don't not all of my tv shows have sex in them like this is not a thing but i'm not saying that I'm going to just be watching Apple's TV content, right? Like, yeah, these will just be the programs I watch on Apple service might not be explicit, but then there are other shows like your Game of Thrones, which are not there anyway. They're somewhere else. Like currently we go to places and watch content, but like people still watch content on NBC, right? People still watch content on NBC, right?

People still watch content on network television that they really enjoy, like Brooklyn Nine-Nine, one of my favorite TV shows. It's on NBC. There's very little hardcore sex and nudity in Brooklyn Nine-Nine. So it's like, I don't... I understand why people think this, but I don't think that it means they won't make good stuff. They'll just make good stuff that meets

certain guidelines of maturity so there's still good content to be in that area maybe i think it's a question because of whether it is something that the tv guys are running based on a premise and they accepted that premise when they came and they're like here's what we're going to do because we don't know what this what the brand promise of apple TV is going to be and who their target audience is. We don't know anything about it. We are making guesses. And it's very easy to say it's going to be Netflix or it's going to be HBO. But it's probably not.

It's probably going to be a little bit different. And they're going to position it as something that is great for families, great for people who've got kids, and also for adults. But it's not going to be, you know, it's not going to cross a certain line. They'll have some kind of standards there. There is also the argument that, again, credit to christina for pointing this out we we've talked about it before in the expensive nbc conversation which is um sometimes we hear from a lot of people who are like well wait a second i don't like those shows that have like really brutal violence and nudity and sex um i i i prefer uh stuff that that is not quite as hardcore as that, right?

And why are you saying that if it doesn't have violence and sex, it's not any good? And that's not what we're saying. I think there's an audience for it, but there are other audiences. What the concern is, is that a lot of the best TV creators want complete freedom. creators want complete freedom. And when you're recruiting somebody to do a show for you, and you may think, well, I'm writing them a check, shouldn't they be happy? The challenge is that Netflix and Amazon and others are also bidding for their work if they are a A-list creator. And if Netflix says, we won't give you any content notes, make what you want, that is different and better than Apple saying, we have a level of standard that you need to know

about. We're not going to allow nudity and we're not going to allow violence beyond a certain point and sex beyond a certain point. And you have to be okay with that. And if you're an A-list creator and you look at these offers and they're very similar, you're probably going to take the one that gives you complete freedom because then you just don't have to hassle. You can do whatever you want, not necessarily even that you're planning or that your show needs gratuitous nudity,

but that you like the idea that you've got in Netflix or Amazon, a partner with a track record of letting people do the kind of stuff they want to do. And with Apple, you're like, ah, they're going to give me a hassle. So we're in this, but nothing succeeds like success, right? So Apple right now has got a lot of people who basically saw the size of the check and are taking them on faith. So it's money and a little bit of faith, but it's

mostly the money, right? At some point, if Apple launches this and the content is good and it's a successful thing, then it will be known what you do when you make an Apple show and you'll look at it and you'll look at the money, but you'll also look at, oh, I have now heard positive things from colleagues and I've seen the content and now I can go in there and I can trust them. On the flip side, if they launch the stuff and it's not very good and it's really generic and it's like warmed over network TV and there are lots of stories about people getting stuff taken out because Apple said it was not appropriate for their audience, then it will be that much harder for Apple to sign top level talent.

So I think that's the issue that is just outstanding and we're going to have to find out about because it's not that they can't make this work.'s just how they approach it and how they execute and and as i said to christina on twitter in the end the the argument here is apple might might be bad might do this badly and then it'll be bad and then it'll be a failure and it's like that is that is absolutely a possibility yeah but that's true of anything right like you have to execute in the end and we don't know how they're executing. So we'll have to see, like if the shows are bad and the creative people behind them had a terrible experience, then very clearly they will have blown it. But we just don't know now. We have some guesses, but in the end, you know, it could go either way. Yeah. And I think that this is changing a lot of our

perceptions of how they operate and is going to continue I think that this is changing a lot of our perceptions of how they operate and is going to continue to, because this is like a very, very different world. Yeah, people have a hard time wrapping their head around the idea that Apple is doing this. And again, you get the Carpool Karaoke and Planet of the Apps things a lot from people who are basically saying, you know, Apple already tried TV and it was a disaster. It's a very different story this time, but I get the idea that it's very hard to shake the perception that these are computer people making TV. Yeah.

I mean, a lot of the time, all you've got is what you've seen, right? And if that's what you've seen... I mean, Netflix was a logistics company. They basically, they were a tech company in that they could build a website and a logistics company in that they had warehouses with DVDs, right? And they became Netflix, as we know today. They are essentially a tech and logistics company that turned the corner into producing original content and then a streaming technology company, right? When they went to streaming originally, but then they started creating all their own originals and they became Netflix. They did it. Amazon, again, is a tech and logistics company

They did it. Amazon, again, is a tech and logistics company who hired a bunch entertainment company, as a maker of video games and streaming services and as a movie studio. And that is, everybody thought that they would just sell it off and get out of the business. But again, you know, Sony is a tech company. They see the value of being in the entertainment industry. So this is not the only time a company has tried to do this, what Apple's doing right now, it's very different for Apple, and they may not succeed at it. But if you think of Apple as a company that only can make good hardware, that's fair. But they also have a lot of cash in which they can set up entirely new businesses

and take a shot. And that's what they're doing. So we'll see how it goes. It's not Apple. Apple took the name computer off of their company more than 10 years ago. They're a different company now, and they continue to grow and change and do things. In the last two years, you and I have done a lot of shows where we've said, here's what we expect from Apple because they've done it the same way

the last few years and been surprised when they did something different. Apple's not playing by their old rule book anymore. And I think that's good because I think complacency will be the death of any company, especially a company that's been as massively successful and profitable as Apple. So I like that they're trying other stuff i we also yes should we also still be critical of how they're handling the mac and ios and things like that sure but when you've got hundreds hundreds of uh or 100 billion dollars in the bank um you know the people who are programming apple tv are not designing keyboards for laptops these are separate businesses and yeah and people have a hard time keeping those things apart right right? People are like, oh, why are they doing a TV thing when they should be making better laptops? It's like, well, you know, those are different things. They

should be making a TV thing and making better laptops. And one part of their group is over here doing A and the other part is doing B. And, you know, your criticism of B really doesn't have anything to do with A i don't think tim cook is skipping the meeting about the the macbook keyboard in order to watch his uh screeners of the new ron moore space drama right well that's what that is what we expect anyway right but yes i think tim was watching the his screeners when he's on his uh his stationary bike at 5 a.m i think that's probably what he's doing oh and he's flying to europe for to meet people which does a lot um we we stated this i want to reiterate it because it's a lead-in to the next part even though we'll take a break

because like the reason they are doing this a primary reason they are doing this is to appease wall street so apple need to show growth. And one of the ways they will show revenue growth is in getting their existing customers to give them more money. It's very important for the game that Apple has played. And I mean, it wasn't Tim. Tim didn't decide to make Apple public,

but this is where they are. They have to appease Wall Street. It's kind of his job to do that. So one of the ways they're going to do it is they're saying we're going to increase the services revenue and part of the services revenue is making people pay them more money for more stuff and this way especially by doing what they're doing now they can make their existing customers pay but isn't it also nice that now you don't need to be an apple customer to watch their content you just need a samsung tv and probably Fire TV box. So they can get Android customers to pay for their content too.

So this is a way for Apple to get more money. And viewed a certain way, Apple launching a TV service is literally no different than Apple doing research into AR glasses or cars or anything else they're doing. What happened three years ago when they announced that thing about services revenue, that shows you that Apple internally has been talking because of Wall Street, because they're a

public company and Wall Street is concerned with growth, about the obvious end of the road for massive iPhone revenue growth and sales growth, right? The end of the ride. I wrote a whole thing at Tom's Guide, and we'll talk about it in our next segment, I suspect, about Apple and the iPhone. But it's been very clear for a long time that Apple knows that their massive engine

for revenue growth that Wall Street has loved is going to stop. And it's going to be profitable, but it's not going to be growth like they're used to. And so they have been placing lots of long-term bets on other ways they could raise revenue to grow revenue beyond the iPhone. And this is one of those bets. But all the money that they spent on Project Titan, whether or not there's ever anything that comes out of it, that was one of those bets too. This is just more visible because they're spending money and paying

Hollywood people and making deals with TV manufacturers. But it's all the same in the end, which is how do we find new ways to grow Apple? Because the fact is, although a lot of Apple fans would like Apple to just sort of stick to its knitting and focus on making computers and maybe phones and iPads forever. The fact is, as a public company, they basically can't. They basically can't. The pressure to continue showing revenue growth is enormous. And we could argue about whether that is healthy for any company who's incredibly profitable to be forced to show revenue growth. But that's just how... Welcome to capitalism. This is where we are. So they're going to take that cash hoard that they've got and invested in a whole bunch of

stuff, and hope that some of that stuff hits, doesn't all have to hit, but hope that some of that stuff hits and continues to be the engine that fuels revenue growth. Even as the iPhone is just throwing off profits, you could think of it that way, in fact, and we'll talk about this more in the next segment that, you know, the cash generated by the stable, profitable iPhone business is the thing that you use to fund whatever is next. Today's show is brought to you by our friends at Luna Display. Have you ever looked at your iPad and your Mac and you thought, these devices should work together? They both have these beautiful screens. What if I could just use my iPad as a second display for your Mac?

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jason that i did just a couple just yesterday actually i'm preparing for this show i write out my notes for this show in apple notes that's tip because i'm collecting links in there and i'm writing my notes out some stuff i write like big chunks of our outline, which I will drop in. Something that drives me crazy on iOS is rich text is not observed well between applications. So if I copy a lovely bulleted list in my notes and drop it into Google Docs, it doesn't observe the bullets. It just puts a bunch of asterisks in and I have to go through and manually change it. So I thought, oh, I know what I can do. So I opened the Luna Display app.

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So, this is, I didn't realize until we started talking about this how perfectly these two topics that we're talking about today go together. Yeah, I just kind of

flowed into it in the last segment. I was like, oh, we're talking about the next thing now, aren't we? We should take a break. So, Apple need to continue to show an increase in services revenue. And they knew this because they knew eventually the iPhone would

either flatten or start to go down. And I think to everybody's surprise, it's happening right now. On Wednesday, Tim Cook posted a letter to investors on Apple.com that highlighted they would not meet their revenue guidance for the holiday quarter, which is financial quarter Q1, and that they were now going to adjust their figures. Apple had previously set their revenue guidance at somewhere between $89 to $93 billion for the quarter. It has now been adjusted to $84 billion in overall revenue for the quarter. to 84 billion dollars in overall revenue for the quarter so we're looking at a change a miscalculation of somewhere in the range of five to nine billion dollars right that's kind of like where we're looking at they're saying it will be 84 roundabout but they were previously projecting somewhere between 89 to 93 um i'll give some more follow-up there was a great discussion on atp this

week uh about this very topic luckily for them it happened like an hour before they recorded so like yeah that was that was very pleased that they got their interest under the wire there so let's talk about why did this happen so i should just say like the the the letter is very complex and we're trying our best to break it down right because it is written for investors and i think as you would probably imagine and as i believe a lot of it is written in such a way to try and hide a little bit about what might actually be happening like apple can talk about and i believe everything they're saying but i'm sure there's there's a little bit in there where they're just trying to like make things look a little better than maybe they are because this is how companies operate right like you're not

gonna be completely honest that's no there's the um yeah the idea here is that they are trying to put the best face on it they can yes um because although i also all right exactly but they also have to disclose and i think what's interesting is that even though the bulk of it is about china shortfall they if it was really all about china shortfall and they had no other concerns it that's what the statement would say and it wasn't that was it took we took a header in china oh also that was the biggest that was primarily why oh also here's a whole bunch of other things and like that is my when i first saw it i thought well this is interesting because it sounds to me like apple had a problem in China with iPhone. And they're using this moment to have the China thing kind of overshadow all of these other underlying things that are going on with the iPhone.

And I feel like that is probably what's going on here. There is weakness in the iPhone elsewhere. They made some mistakes about the iPhone elsewhere. And they're not, I think maybe even legally not allowed to just completely sweep that stuff under the rug. They need to get it out there. They want your attention on China. They want your attention on the big thing and not all the other underlying things. But it's hard not to look at all the fact that they went to the trouble of mentioning them and say, you know, yes, this is a big China miss. That's the primary driver here.

But they're also owning up to having a lot of other issues, largely regarding the iPhone, more worldwide. And so it's important not to let that override the fact that there is a big miss in China, but also not to ignore the rest of it. Yeah, because there was more, right? That's what's so interesting about this. So like, why did this happen? Why did they miss this? So as you say, china's what they're saying is the big thing tariffs

economic deceleration rising tensions with the u.s they give every possible reason right that that there could be a thing there's a great free piece uh that ben thompson just posted about uh apple's errors he calls it his weekly piece at stratechery and he makes the very strong point that they should have seen this coming for a few reasons and that's actually my biggest concern about this is at the time i remember they did this forecast i'm like wow okay like everybody's like really great like because we trust apple's forecasting they have they have very rarely steered anyone wrong and as ben thompson wrote like number one on the agenda should be the last time apple followed up a super fancy new phone

that brought a lot of new features with an s series model sales tanked in china that that just you know that was the six six s with the bigger phone uh so they did the 10 and they're like oh no no no everybody in china is going to rush out and get the 10s like no they didn't and uh and i think that makes a good point like this is not just necessarily about economic weakness in china although it's this is complicated it's about a lot of different things but ben's point i think is a good one which is also the Chinese market has shown a lack of receptivity to the S model of something when they bought the original model the previous year. And that drove sales up. And I think the iPhone X was a hit in China.

But the iPhone 6 was a hit in China. And then nobody bought the 6S because it was just the 6 with slight differences. And the Chinese market seems to want more, demand more from a new iPhone if they're going to buy a new iPhone. Yeah. Allow me to read these two quotes. So this is one, I like these two back to back

because I think it shows what we're trying to say here. So lower than anticipated iPhone revenue, primarily in greater China, accounts for all of our revenue shortfall to our guidance and for much more than our entire year over year revenue decline. That is written in such a way that I don't fully understand it and I think that's kind of

the point. Because if that's all it was, then why is it then followed up by this statement? While Greater China and other emerging markets accounted for the vast majority of year over year iPhone revenue decline in some developed markets iphone upgrades also were not as strong as we thought they would be

so what i my takeaway from this jason with absolutely no real expertise is that if you look at everything overall right if the the with what happened in china there are other parts of this that brought it down but then there are other parts of this that brought it down, but then there are other parts in other countries that brought it back up again. So it's like these two things are true, but the real picture is they lost money everywhere in China.

They made money in other places in other markets that brought it back up again, which is why they still have to point out the fact that there was still enough iPhone revenue decline outside of China, which made the iPhone down year over year. That's my read on this. So like, while greater China and other emerging markets

accounted for the vast majority of the year over year iPhone revenue decline, in some developed markets, iPhone upgrades also were not as strong as we thought they would be. Now, I am going to take that to mean the United States of America. And the reason I would take that is because later on when they talk about developed markets, they specifically name some, but they don't specifically

name any here. So why did this happen? Why in developed markets, did Apple sell less iPhones? Apple say, macroeconomic challenges, fewer carrier subsidies, iPhone battery replacements. These are wild to me, by the way, like those last two. Because the carrier subsidies is not a 2019 or 2018 new thing. This has been a thing that's been going on for a long time, right? Their ongoing narrative in the calls that they do with analysts quarterly has been that the carrier subsidies going away has changed buyer behavior. And I think that's what they're saying here. I think, again, you and I would probably say, why did it take them quite so much by surprise?

I do agree with the idea that they're trying to figure out what the new buying cycle is and the old rules don't apply. And in his CNBC interview, Tim Cook did the day of this, one of the things that he talked about was Apple being more aggressive, not only in those trade-in programs that you and I talked about, where it's the 10R with a trade-in and all of that, that they're trying to push, but also in being more active in pushing monthly plan payments because it was really good for Apple when the perception was that the iPhone will cost $300 instead of $1,000, even though you were paying for it monthly for two years. It was really good for Apple because it lowered the the perceived

price and so i think in the future you will regardless of what apple does in terms of the actual price of these iphones i think you will see apple be even more aggressive in terms of having uh the uh the trade-in programs and and a uh and a price with a monthly fee basically like a a monthly installment plan kind of thing i think they're going to do even more of that because their feeling is you know we can sell a lot more iphones over time if people feel that they're cheaper than they are by putting them on a plan like back in the subsidy days so i agree with that the question is did they not factor that in already i guess maybe they were more optimistic about being able to convert people it just seems like a surprise that it's that somehow caught them

it comes back to what i was saying before which is i think my number one takeaway about all of this is not like oh no the sky is falling iphone sales are flat um and and below expectation and it was only the second most profitable apple quarter ever? Like there are problems and then there are problems. My problem with this is that Apple blew it, which means that either they had no idea and they were taken completely by surprise, which is, you know, like, did they take their eye off the ball or they are delusional and they believe their own press releases and they think that they can never go down. They can only go up. Either way, I think that's the fundamentally worst part of this is there are lots of things that are listed in this story that they should have anticipated. And they either didn't believe it because of some delusion or they didn't see it.

And either way, that is concerning right that is it actually reminds me of when they released the iphone se and they were like whoa we sold more of these than we thought and that was a good that was a good story but at the same time it's like how it shows you guys are out of touch with your customers because you should have anticipated that this phone would have demand and even though you released, you didn't believe in it. So I'm having one of those moments here, which is, why did you miss this? Because a lot of this stuff does not seem unforeseeable. The iPhone battery replacement program is a similar thing. It's like, that's been going on for like a year, guys. You should know how it's been going yeah this should not have been

a surprise this battery replacement thing i think this is bull uh here's my thinking on this right okay one how many could it really have been now let's imagine it's hundreds of millions right it's not going to affect revenue growth the fact that the batteries were replaced or that apple may have been doing the battery replacements at a loss that's an operating cost it's not a revenue thing right you don't subtract the amount of money that it costs them to replace these batteries from iphone revenue right like i feel i've seen a lot of people talking about that these are not the same thing right like tim is not saying we were taking a loss on all these batteries so it's it's decreased our revenue what they seem to be saying with this

is like people replacing their batteries means that they didn't buy new phones now there are a bunch of issues in that right which is like one so you were coasting for years on the idea that people needed new phones because their batteries were bad right but the other part is if somebody decides that they're going to put a new battery in their old phone and this is better for them than the new phone does that say something about the new phone like what does that say like my feeling is the phones are too expensive and that's what's happened here. Yeah, I think it's all those things. I think this is, it's really funny to think that this new story about battery. So let's even rephrase this.

A decision made in iPhone engineering in power management to solve the problem of old iPhone batteries not being able to hold the charge and causing spontaneous shutdowns, which was really annoying. And their response was, we can fix this by throttling. And then everybody has a better experience because while their phone is slow and that's not great, at least it stays functional and it doesn't need to flip open the camera and it dies, which was the most common thing is flip open the camera or video and it dies because now it's got a spike. It needs more battery, more power than the battery can give it. And it shuts itself down. That decision had potentially incredible consequences because it led to that

battery gate story, which led to Apple changing its UI and getting lots of bad press. But it also led to Apple doing a very, I would say, very Steve Jobsian thing, which is like, fine, have a cheap battery. that may have been at a loss that had a lot of fallout because I've talked to people who work in the Apple retail stores. And since that battery program was announced the whole year, they were completely swamped with battery replacements. Like it has it, like it completely changed the complexion of at least the people I've talked to of their stores where they have people frantically working on this massive influx of people who are bringing in things. And keep in mind, this is retail employees being focused not on people who are buying phones, but on people who are doing something that Apple's taking a loss on,

possibly. So there's a lot of loss going on because of this program. And in the end, I don't know about you, but I kept people uh from people in december who are like oh yeah i gotta take my phone in before december 31st yep for the battery replacement like i knew many people who did that and so like what we've done here apple you have inadvertently educated the market that when your iPhone is old, get a new battery. And I do think that in a tech bubble, we miss how people really use their iPhones. And I saw a thread about this on Twitter that I thought was really good, which is if you look at... My friends who are not in the tech bubble, do this too.

Like so many of them have broken iPhones that they still use, you know, iPhones with shattered screens that they still use this idea that, you know, you, you just replace your iPhone every year or two. Like in the real world, a lot of people try to stretch their iPhone as long as they can because they will like the new phone when they get it, but the old one works fine and they just want to keep using it for as long as possible.

And the battery replacement program is like a shot in the arm, right? It's like, oh, I didn't even know I could just get the battery replaced and now it's faster and it lasts longer. I'm never going to need a new iPhone, right? And so there has been this interesting educational process where Apple inadvertently has educated everybody who's interested in getting the longest life out of their iPhones that they can do that by paying $29 or $59 or whatever the final new 2019 rate is. It's still a pretty good deal and way better than buying a new iPhone. And they burden their retail store in the process, which is really great. So yeah.

And then the more you raise the price of the iPhone, the more the weight goes toward putting off an upgrade. So it's both of those things. I see a lot of this as like, they inadvertently dug their own grave on this situation because I saw Steve Troughton Smith mention this. This is the same year where iOS 12 made old phones run better.

At the same time, they're giving you batteries to make them last longer. People aren't buying as many new phones. If you think about it right now, I'm not trying to build a conspiracy theory here, but there is this idea of this planned obscence right like people have a belief that their phones are only supposed to last an amount of time then they get a new one so what that actually translated into is people's phones would would get slow they would start dying so they buy a new phone right

but like so what was actually happening is that was happening people's phones were crapping out on them so they buy a new one but now there are these two things, which mean their older iPhones run better, so they're not buying the new phones, especially when the new iPhones are really expensive. So it's one of these things you mentioned earlier about Apple knowing their customers. Maybe this means they didn't know why people, they thought everyone was buying these new phones every year because they were amazing and new and they loved them so much. But it actually turned out was they were only lasting them two years. So they had to buy a new one.

Yeah. Yeah. That's, I think there is some truth in that. I do think you mentioned the iOS 12 stuff, you know, based on what they said on stage, I kind of feel like this is actually Apple's long game. Apple's long game is we are going to, I mean, they said it on stage, we want you to be able to use the iPhone as long as possible. We want to extend that life because we want you to feel good about having that. But unsaid, there are a couple of things. One is we want to keep the resale value high because we want to get you in a new iPhone. And if the old iPhone value stays up because it continues to be useful, that trade-in will give you some trade-in value.

You're more motivated to buy, and then we will take that, and we will do something else with it that makes us more money. So that's number one. And then number two is, oh, you only want to buy an iPhone every four or five years. Well, we're going to start making $1,000 iPhones. And so instead of you buying a $500 iPhone every two years, you're going to buy a $1,000 iPhone every four years. The problem with that is sticker shock. It's easier to do if you're on a program, if you literally just pay Apple monthly for four years or three years or two years to get a new iPhone, but when you have to write a check for

$1,000, it's a lot harder to buy that phone. And so those two things work. So I get what they're doing, which is if phones are not disposable and they need to be kept for many years, why don't we make them better and nicer? And that way we keep our revenue and you keep having a great phone that can last a long time and everybody wins. And the problem is, I think consumers are saying, yeah, but that's still too much money.

I'll just hang on to my phone for a little bit longer. And the cycle gets longer. And it seems to me like maybe Apple's calculation about that. If it hit them too soon or like, you know, this was the plan, but they didn't expect it to be this year or whatever, right? Yeah. Because I do feel like underlying all of this, I mean, we've been talking about it here, but underlying all of this is I get the sense that amid all of these other things, they probably made a mistake on pricing. They probably pushed it a little too far.

I uncategorically now believe that. Like I thought it and like, you know, it's like, because here's the thing. And again, this is super anecdotal, but everyone that I know outside of the tech bubble that I've spoken to about this week, I've gone, yeah, of course, because the phones are too expensive.

Yeah, exactly. And this isn't like a perception thing those phones are way too expensive like we all knew this we knew this and it's like this idea of like oh well they're made out of stainless steel yeah but you chose to make them out of stainless steel right like that didn't happen exactly well and the iphone 10 and this is the other piece and something that ben thompson mentioned is like you talk about the 10r which is like it's nice that they made a cheaper phone. Although, again, it's not really cheaper because it's the cost of the old iPhone 7 plus, right? It's not cheaper.

It's like multiple hundreds of dollars more than the phone was in its place previously. Exactly. $750 for that. But there's the other piece, which is Apple has cultivated an audience of people who want the best. That's why they go with Apple is they want the best. And the XR isn't the best. The XS is the best. So a lot of people, even though the XR is a really great phone,

I think there's some buying psychology there where people look at the XR and they're like, yeah, but no, I'm going to get the XS or the XS Max. So that's going on too. That adds complication. Their decision to release the X, the X X and then the XS and XS Max was a decision to build this ultra premium phone at a high price. And I actually, I think, I understand that maybe that phone is super expensive to make. And as a result, they want to price it high. The problem is that if your audience only wants the best iPhone and you've made a super best iPhone that costs too much for a lot of your audience, you lose your

audience, right? Like the idea that you can create an edition, right? A watch edition. But if the only people who will buy your product always want the best and the best is now overpriced, it's priced out of their price range, then they just don't buy, right? I think there's some, maybe some psychology here that they missed. I don't know. I mean, we're all speculating about this on the outside, but that's, that, that is my gut feeling is that, is that they've been, look, let me take you back two years. Remember when we heard the first rumors about the iPhone 10 and the idea that they were going to release two phones. They were going to release it or three phones, a 10 and an eight basically.

And you and I had a long conversation on this show about how risky it was that Apple was tinkering with the iPhone because it's their, it's their most important product. And it's like super risky to change pricing and confuse the market with like two different models. And are people going to buy the eight if there's a 10? Or are they going to buy the 10 if there's an eight and all of this stuff? And this goes back to our previous segment to like, why? Why risk it? They knew that all these factors that they just said in this report that they were surprised by, they knew all of this stuff was happening. They knew that the carrier subsidies were going away and that the lifespan of your iPhone was going to be longer because people weren't going to want to buy on a two-year contract anymore like they did with their cellular plans. And they knew all of these things. And so this was all part of their strategy to change the iPhone pricing and get more revenue out of it so that they could keep growing revenue even when sales were flattening. They knew all of this. That's why they made these huge risks. And with this year's models, I think it might be fair

to say this is what we kind of were worried about the previous year which is they made a bunch of changes to how they market and sell iphone models and they they got some it looks like they got some things wrong and uh what will be most interesting in 2019 is to see if they recalibrate um because as several people enjoy pointing out, Apple does plan these things years in advance. So at this point, if they really did get taken by surprise and released this statement saying they did, can they change their plans for 2019?

Are they locked into a bad plan? And if they can, how do they do that? It's going to be really interesting to see because I think you and I both agree that they made some very interesting moves this year. And some of the feedback they got from the market is, you know, the consumers is they pushed it too far. So they did give some indication about something that they're going to be trying as kind of like a let's try and put a happy face on this. But before we get to that, let me thank

our final sponsor for this episode. And that is FreshBooks. FreshBooks is incredibly important if you're a freelancer, because they will help you save time, time that you can use on getting your best work done on doing the thing that it is that you love to do the thing that you do that gets you that money. So what FreshBooks do is give you a bunch of tools to help your invoicing and your expenses get done quicker, to give you a bunch of tools to help you get paid online. FreshBooks customers get paid faster because their invoices are simple and easy to use.

You can integrate payment methods right into them. And also you don't have to spend a ton of administration time in chasing stuff up or even getting those invoices created. Their system's super easy to use. It creates great looking invoices that look exactly how they will be received in your client's inbox. Once you send the invoice out to the person, you can track it. You can see when they opened it. You can see when they printed it. You can see every time they go back into it. One of my favorite features is when you go to a specific client, it tells you this is how long it typically takes this person to pay you. So you know, like if you said to someone, hey, pay me in 30 days,

but they pay you in 40 days, a day 32, just wait an extra week before you start bugging them, because you know that typically it takes some 40 days, right? So it just it helps you from having to have those awkward conversations. But if you don't want to ever have to email anybody and say, hey, where's my money, they will do automatic late payment email reminders for you. FreshBooks love to give you all of the tools that you need to keep all of this stuff running smoothly. So you save time and you use that time on getting your work done or even going for a walk in the park. Who knows? Whatever it is, FreshBooks wants to give you that time back by making the whole invoicing and expense stuff easy for you. If you're listening to this show and you send invoices to anyone and you've yet

to try FreshBooks, please, please, please give it a go. They're offering a 30-day free trial for listeners of this show, no credit card required. All you have to do is go to freshbooks.com slash upgrade. And when they ask you how you heard about FreshBooks, you tell them on upgrade. So our thanks to FreshBooks for their support of this show and RelayFM. That is FreshBooks.com slash upgrade. Alright, so, a couple of quotes. How are they going to fix this?

We are undertaking and accelerating other initiatives to improve our results. Is point one. Great! The only thing that Tim gives us is, one such initiative is making it simple to trade in a phone in our stores, finance the purchase over time, and get help transferring the data

from the current to the new phone. This is not only great for the environment, it's great for the customer. Their existing phone acts as a subsidy for their new phone, and it's great for developers as it can help grow our install base. That developer's point,

I don't even get it. It's like, whatever, you're just throwing something in there for funsies at this point. Jason, can I say some follow-up from previous weeks when we were talking about all those banners and we tried to position it as like, maybe the iPhone isn't in trouble,

but it's this, this, and this. I think we can say now they were there because the sales weren't good, right? Like, I feel like we can say that now. Like they were struggling. They knew they were struggling and they were trying to juice the sales going into the holiday season by selling more phones. Right?

It's probably true. It's probably true. I mean, I do feel like there's still this overarching thing, which is part of the idea of pricing a phone that high is that then you have to start getting trade-ins. But would they have had the giant price with the asterisk in it if they weren't needing to boost the moving of phones? I think this says that that's that's exactly right right is that they they had that moment where like wow we need to be way more aggressive at finding a way to sell people this phone for not the full price because they're not buying it at full price and you know that's that's the truth of it i think um the the yeah pricing it that high like if they've got room to room to discount it that's good like

i feel like um when you see uh like target or best buy or something have a an apple device for a hundred dollars off one of that's one of the advantages of of the high prices that they're setting is that they can do discounts that they couldn't do before but in this case being this aggressive about it somebody saw the numbers in November and was like, oh no. And then they're like, what can we do? What can we do? And I would imagine by this time, by the fall when they launch new iPhones again,

that we're going to see this. We're going to see Apple's marketing and their in-store experience and all of it be based around something like a price with a monthly or a monthly price with no money down and trade-in offers. And they're going to be super aggressive about... It's like buying a car, right? They're going to be like, what can I do to get you to leave here today with an iPhone? What can I do to get you a new iPhone today? Exactly right. So it'll be like well you've got what phone do you have now

oh you have an eight uh or you have a seven well uh you can get this for this price and uh or you could get this for with you trade in your seven for twenty dollars a month for two years and we'll set you up right here like and if i'm Apple and Apple retail, right, I am investing huge amounts of time and money right now in a strategy that will let, you know, the upgrade experience. The Apple has done, you and I did that show a long time ago about how frustrating it was to buy a new iPhone on the, on the backside, because you had to transfer your data and all of that. And it's echoed here a little bit, which is buying it at the Apple store can still be frustrating, especially with the sticker shock that's there now.

So this is the next way to make the getting a new iPhone experience to be better. And it serves Apple because it sells more new iPhones, which is, can we make it super easy that if you walk into the store and say, I want a new iPhone for them to be like, do, do, do, uh, you know, you're signed up for this thing. We'll bill you every month. Uh, we transferred your data and here's your phone and you walk out like the, the slicker they can make that the better that that'll be for them and the better that they'll be able to make a sale, whether they can do that all without also cutting the the retail price is interesting i will say i never thought apple would stop reporting sales figures and they did that so it wouldn't surprise me if apple starts not marketing the full price anymore if apple

just stops talking about 9.99 right get a new iphone from 4.99 right yeah 349 with the standard 20 also i'll say if they do an apple prime subscription service um does that fit in here where you can just say you know apple prime customers can come in and get it for and that built into apple prime is a two-year iphone thing i mean there's lots of things that they could do, but I do wonder if, at the very least, you're just not going to see Apple market the full price of their phones anymore. Like back in the day when there were carrier subsidies, and you could buy an unlocked phone for $699,

but who does that? That's crazy. We've entered this era where that unlocked price is the price everybody sees, and it's really bad for Apple. We should actually do some Ask Upgrade questions to finish out today's episode. And I think of this mainly because we have a question from Ted here.

Ted says, if Apple would introduce Apple Prime during the next iPhone launch, including like you get an iPhone, you get AppleCare, Apple Music and Apple TV, the video service and news for say like a couple hundred dollars a month. Do you think that this is something that would entice people? I'll also include in the links an article from MG Siegler where MG wrote about all of this sort of stuff a while back and kind of followed it up recently with this stuff. One, do you think this is something that will exist? And two, is it something that would interest you? I think they should do it. I think there's a question about how do you make that bundle something that is worth it?

What you really want to do is make a bundle that has things in it that people want, and then they get some other stuff that they didn't want, but maybe they use out of it. And, you know, so like for me, I look at this and I'm like, well, what would I use and what would I not use out of it? And I'm, I am paying for Apple music.

I am going to pay for Apple video. I am paying for iCloud storage. Uh, I don't generally pay for Apple care, but if I could pay Apple monthly, a fee that seemed reasonable and get all of that and potentially yeah potentially get uh you you you would probably have to add in devices right because they're so different many different device levels so the price would change what you would pay as a monthly but the idea is that all the other apple services it's basically the iphone plan upgrade plan with apple services rolled into it on top and i could do that for my ipad and they would just add in another monthly fee for that.

And there'd be a predictable thing. I'd think about it. I'd think about it. Just services alone, I would think about it because I kind of don't love the fact that I get, you know, Apple- I don't want a bunch of individual charges. Apple invoices every week from different parts of Apple.

It seems like a waste. I would really like to just sort of know what I'm paying them and what I'm getting out of it. But I get that there's a lot of complexity here. And I think also, if you're somebody who is not comfortable putting down a credit card for $1,000 piece of hardware, the idea that you have an understandable expense, that you know you're going to be paying X per month for two years instead of having that giant expense upfront, that for a lot of people, that is something that they're a lot more comfortable with. So I feel like Apple at some point has to bundle their services together in some way. I don't know what way that would be, but when they add video and

they add the new stuff that they're doing, it starts to feel like they have so many different services that surely one way you make people tied even more tightly to your ecosystem in a services-oriented way is by building a club, a bundle, some sort of thing like Amazon has done. I'm starting to look at stuff like this, and I feel like it seems inevitable now as a way to solve the two issues that they have. Right. Like you get people on these plans and they'll just keep getting new phones every time. Right. You can just keep rolling into a new one. And then so then you have even more phones in the chain to sell at cheaper prices when they roll out of those year or two year long contracts. when they roll out of those year or two year long contracts.

And it also puts more money into your services because people are getting the services because the only way to get the phones on these rolling contracts is to do them in the bundles. Like I see all of that together as like a, yeah, okay, I think I can see all that happening. Our next question comes from Adam. Adam wants to know, Jason, when you're editing in Ferrite,

what is the best way to get large audio files onto your iPad? So I used to use USB all the time. You know, you attach your iPad to your Mac via USB, you open iTunes, you go to the iPad, you go to file sharing, you pick Ferrite, and then you drag the files in, which is a terrible interface. And I wish Apple would change it. However, now I'm starting to think Apple will never change it because I have stopped doing that. I airdrop the files. I bring my iPad over to my iMac and I use airdrop. And airdrop, if they're all the same file type, so if I've got waves of every file that is going in the podcast, I can select them all and drag them over to my iMac or my iPad with airdrop from my iMac. And airdrop goes really fast when it's a dedicated direct connection. It goes really fast. It's not quite as fast as the wired connection, but it's really fast. And the nicest part is that iOS is much better at accepting airdrops than it used to be. So when I get those files over, a dialog box pops up and says,

what app would you like these files in? And it knows that the last time I used it, I selected Ferrite. So that one's highlighted. I tap Ferrite. Ferrite opens and all the files appear and they went straight into Ferrite. And that's it. So since I have tried that, it's super easy to do and that's what i do now and if you have different file types you have to do them separately otherwise

airdrop gets confused so if i have a an aiff along with the waves aiff has to get loaded separately by a separate airdrop but otherwise it's uh it's really straightforward and um and so yeah i'm using that now i don't't want to use iCloud Drive or anything like that because what ends up happening is that I have to upload those files all the way up to the cloud even in my house and then download them back from the cloud in my house. And it's stupid. It's just a waste of time.

And I don't need them then. Then I can delete them from them. There's no point in doing that. So, AirDrop. You would be surprised what stuff you can AirDrop to iOS if you haven't tried it in a while it's uh it's pretty versatile in accepting files via airdrop so that's what i use now and finally today richard says i'm trying to make a shortcut that can add text to an existing note in the notes app and i'm sure and that i'm sharing with other people do you know a way

this is really i this is a great frustration for me um Apple Notes does not let you append to notes. Right. I have a note shortcut. So what I'll do is like if I want to add something like a URL or whatever, I will open the shortcut and take the URL. Then I have a little menu pop up that says, what note do you want this to go into? And tap it and it just opens the note and then I have to paste it.

It's not great. This is based on something that Federico it just opens the note and then I have to paste it. It's not great. This is based on something that Federico built. Like it's not the perfect way to do it. But for now, that's all it can be. I really hope that a shortcut gets added in the future to append to a note that I would love that because I'm doing this stuff all the time. But I will make some recommendations.

There are some apps that will let you do it. So Bear and Evernote both have shortcuts to append to existing notes. So I know that you were saying that you share with people. Evernote has sharing functions. It's up to you if it's that important that you would move to it, but they are some options.

But I really do hope that Apple add an append to notes shortcut in the future because that would be so great. Yeah, I agree. I think there's a way to append text add an append to notes shortcut in the future because that would be so great yeah yeah i agree i think there's a way to append text to a file in icloud drive but again but that's not work for apple notes notes which is so upsetting file yeah because that that append to that came from workflow the one that lets you append to a file in dropbox or, so that's like a grandfathered in workflow action. So, fingers crossed for

something on notes there in the future. That would be lovely. Alright, so that wraps up this episode of Upgrade. If you want to find our show notes, go to relay.fm slash upgrade slash 227, but they should also be in your app of choice. If you want to send in a question for us to answer at the end of the show, hashtag

askupgrade. We'd really appreciate that. Thank you to everybody to answer at the end of the show, hashtag AskUpgrade. We'd really appreciate that. Thank you to everybody that does. You can open the show with a hashtag SnellTalkQuestion, which can be about pretty much anything by and large. Not tech stuff, I think, is my preferable in most cases because we can answer those questions in AskUpgrade, which is why I asked Jason about Mexican food today. I'm not saying the word because I just can't do it.

If you'd like to send in some feedback for the show, you can send tweets to us or to the at underscore upgrade FM account. But we're on Twitter. I am at I'm Mike. I am YKE. Jason is at JSNL, J-S-N-E-L-L. Sixcolors.com and TheIncomparable.com are two places you can go to for more Snell content. But we both host many other shows here at RelayFM

go to Relay.FM I bet that Jason is going to have all of the CES coverage you're hoping for on download this week yes it's going to be good I think we I'll promote this if you haven't yes you should do it this is why I did it I want you to tell

people about this I think we're going to draft things from CES. Relay.fm slash download. I think it's Micah Sargent and Flo Ion who are going to come and join Stephen and me and we're going to draft things from CES. So people should check it out. Very much looking forward to that one.

So if you want to draft and you want it to be about CES, the only place you can go to get it is not going to be my assumption. Thank you want it to be about CES, the only place you can go to get it is not going to be my assumption. Thank you so much to our sponsors this week, the fine people at FreshBooks, Holo, and Lunar Display. And most of all, thank you for listening. We'll be back next time. Until then, say goodbye, Jason Snow.

Goodbye, everybody.