0:00:00[Music]
0:00:12From Relay FM, this is Upgrade, Episode 418.
0:00:16Today's show is brought to you by Sourcegraph, Bombas, and Capital One.
0:00:21My name is Myke Hurley, I'm joined by Jason Snow. Hi, Jason.
0:00:24Hi, Myke.
0:00:25Oh, hi, Jason.
0:00:26How are you?
0:00:27I'm good. That was very, like, mellow introduction.
0:00:30I just, you know, you said hi-- I was ready for a "Hi Jason" Snell,
0:00:33and I was gonna do my "Hi Myke" early, and then you're like, "Hi Jason."
0:00:36I'm like, "Oh, hi Myke."
0:00:36Keep you guessing.
0:00:37How's it going?
0:00:38Sure.
0:00:39I have a #SnellTalk question for you. It comes from Savva, who wants to know,
0:00:42"Jason, do you brew multiple pots of tea with the same tea leaves,
0:00:46or do you replace the leaves after every pot of tea?"
0:00:50I replace the leaves with every pot of tea.
0:00:52You could-- you can do it. They don't taste as good.
0:00:55They're weaker and sometimes they can be more bitter.
0:00:58And I've decided that if I'm like,
0:01:02I buy loose tea in bulk,
0:01:05I can afford to just make another pot of tea
0:01:08with fresh leaves.
0:01:09So the old leaves go in the little compost can
0:01:12and the new leaves go in the tea robot
0:01:14and I make another pot of tea.
0:01:17That's how we do it.
0:01:19- La-di-da, look at you, you know?
0:01:21- Yeah, yeah.
0:01:23I mean, in a pit, I used to not,
0:01:25but then it's better this way, so I just do it. It's fine. Again, I buy it in bulk. Like,
0:01:30it helps to buy it in bulk. I understand when you're in situations where you have limited
0:01:35tea or you've got a tea bag and you just use it and like, "Can I use it again?" The answer
0:01:39is you can use it again. It's not as good, but you can. I don't, though, anymore.
0:01:45If you would like to help us open an episode of the show and learn more about Jason Snow,
0:01:49you can always send in tweets.
0:01:51Oh boy.
0:01:52the hashtag snow talk or use question mark snow talk in the relay FM members
0:01:56discord I mean ultimately it's just what this is right like this is people
0:02:00trying to learn more about you yeah I mean it can really be it's it's AMA it's
0:02:05a it's a world slowest low MA yeah I like that that's what it is
0:02:10speaking of a maze it's something we started doing for relay FM members
0:02:14there's a new show called spotlight we mentioned before you've been done an
0:02:18episode and Christina Warren's done an episode. This is content which is given
0:02:22out to all Relay FM members in the crossover feed but you can get access to
0:02:26this and also Upgrade Plus if you go to getupgradeplus.com you will get
0:02:31longer episodes of upgraded bonus content just $5 a month or $50 a year.
0:02:36We have some, I don't know, this is interesting for me anyway and maybe it's
0:02:41interesting for other people. We have some a change here on the upgrade
0:02:46program, I am no longer editing the upgrade program.
0:02:49Mm.
0:02:50Uh, we are now handed over the brains to Jim Metzendorf.
0:02:55Uh, Jim edits a ton of content at Relay FM, like Rocket with Simone, Brianna, and
0:03:02Christina, Roboism with Alex and Kathy, Mac Power users David and Steven, and
0:03:06Tanwa Ibracul- he does some of my shows, uh, Analog and Remaster for some of them.
0:03:11I've edited Upgrade for 100 years, eight years,
0:03:16seven years, seven, eight years.
0:03:19- Since the beginning, since episode one.
0:03:21- Yeah, and I need to make some changes in my schedule.
0:03:25And I'm here until very late every Monday.
0:03:30And so Jim is gonna be doing it.
0:03:33If I sound weird today,
0:03:34I'm a little emotional about this, Jason.
0:03:35It's quite a complicated thing for me.
0:03:39- I just went through this
0:03:40because I edited The Incomparable for 11 years.
0:03:44And earlier this year, I handed that off to Steven Schapansky
0:03:48and it is great.
0:03:50So when you came to me and said,
0:03:51"I'm thinking of not editing the show anymore,"
0:03:53I thought, "Well, it worked really well for me.
0:03:57It's gonna work well for you."
0:03:58It is one of those things.
0:04:00I know I've told this on the show before,
0:04:02but in January, I did my little offsite
0:04:04in where I went to Sonoma for a couple of days
0:04:06and I just thought about my business
0:04:07and like big picture stuff instead of the nitty gritty.
0:04:10And one of the things that I realized
0:04:11is that after seven plus years of doing a small business,
0:04:16there are things you do when you start a small business
0:04:17because who else is there to do it?
0:04:19So you do them all.
0:04:20And then seven years pass and you think,
0:04:22why am I still doing this?
0:04:23I can do this, but should I be doing this?
0:04:27And that led me to divest myself of a bunch of tasks
0:04:30that I didn't need to be doing anymore,
0:04:32including editing the incomparable every week.
0:04:35and it is the best thing.
0:04:38And so I think this is gonna be really good for you.
0:04:40I think reclaiming that time,
0:04:41it's hard because you're giving away your control
0:04:43of the final product,
0:04:44which was hard for me for the incomparable.
0:04:47We talked about your note-taking apparatus that you have
0:04:50to give yourself notes about what we say
0:04:52and when we cross talk and all of those things
0:04:55that you're gonna have to sort of adapt your process there.
0:04:57But it also means that when we're done,
0:05:01you're done with upgrade.
0:05:03And I'll tell you, I see these incomparable episodes go out
0:05:06on a Friday morning now, and I like think to myself,
0:05:10oh yeah, right.
0:05:11Because it's just, it's that one layer of remove
0:05:14where I haven't spent five hours sweating over it.
0:05:17Instead, it's just, it just happens and it's out there
0:05:20and it's a great feeling.
0:05:21So good for you for promoting
0:05:23your work-life balance a little bit.
0:05:27- Yeah, it's a weird thing.
0:05:28I don't want to let it go, but I think I need to.
0:05:31But it's just very strange.
0:05:33"Yeah, well, that's how I felt about 'Incomparable'
0:05:36is the same thing."
0:05:36Which is, I really don't, I still don't like the fact
0:05:40that I don't have very specific control
0:05:43over exactly what the episode is.
0:05:45And Steven and Erica, his wife, went on a road trip
0:05:49and I had to edit the "Incomparable" the other week.
0:05:51And it was one of those things where on the one hand,
0:05:54it was really kind of delightful.
0:05:55It was like, "Oh yes, I can take complete control
0:05:57of this episode again."
0:05:58And also every minute I did it, I thought,
0:06:00"Wow, I don't need to do this anymore."
0:06:04So it'll be good.
0:06:06Also, as an aside, we did a verticals episode last week,
0:06:09which was because we couldn't record on the Monday.
0:06:12We prerecorded the verticals episode
0:06:15where we interviewed people and that was a lot of fun.
0:06:18And we got a lot of really positive feedback about it
0:06:20from people who were very happy
0:06:21that we talked to our three guests
0:06:22and got a lot of feedback of like,
0:06:25"Oh, that was great.
0:06:26You guys should do more guests."
0:06:27And more guests,
0:06:29Guest is a lot of work, scheduling guest's work,
0:06:32interviewing guest's work, it's a lot of extra work.
0:06:34However, you know what, I feel like we might,
0:06:38I'm not committing to anything now,
0:06:39but I feel like we're more capable of doing something
0:06:41like having more guests on from time to time,
0:06:44now that you're not editing the show every week.
0:06:47- One of the reasons we would so seldom have guests
0:06:50on the show is 'cause I don't like to edit guest audio.
0:06:53- Yeah, no simple answer, right, there it is.
0:06:56- It's much more complicated, you know,
0:06:58considering the time, because it was,
0:07:01the issue for me has always been
0:07:03that the edit starts really late.
0:07:05The edit starts for me kind of maybe
0:07:07around 8 p.m. on a Monday.
0:07:09And if you added a guest in,
0:07:13you've probably doubled the edit time.
0:07:16Especially if you're waiting on audio
0:07:19to come through with some people.
0:07:21It can, yeah, so it's just like a whole thing.
0:07:23And so to not have to have potential issues,
0:07:27I would kind of discourage having guests
0:07:31because I just couldn't add it in very often
0:07:34unless it was all planned out well in advance.
0:07:37But now that's not so much of a concern anymore
0:07:40which is why we actually have another guest segment
0:07:43later on in this episode
0:07:44and then we have some more later on in a month.
0:07:47And so, yeah.
0:07:49So that's some of our fun though, but we will do more.
0:07:51I think we'll be able to do more outside of that.
0:07:53- Yeah, I think it has been something
0:07:55that we've tried to really limit ourselves
0:07:57to sort of those special Apple guest opportunities
0:07:59and some Summer of Fun stuff.
0:08:00And maybe we'll do some more of it.
0:08:04We're definitely gonna do more of it this summer.
0:08:06And then we'll just see how it goes and how it progresses.
0:08:09But I know it's a big step
0:08:10and I know that it probably is uncomfortable for you,
0:08:13but I think it's gonna be good.
0:08:15And if the show sounds different
0:08:18and there are weird things about it,
0:08:19we're working on it.
0:08:20It's the beginning of a new era on the production side.
0:08:23Hopefully it just doesn't matter and you don't notice
0:08:25and it's all fine.
0:08:27And thank you to Jim.
0:08:28- Thanks, Jim.
0:08:29- Yeah.
0:08:30- And also to finish follow up this week,
0:08:33everyone here at the Outgrade Program
0:08:34would like to congratulate the Morin family
0:08:36on the birth of their son.
0:08:38- Yes.
0:08:39Dan and Kat had a baby
0:08:41and Dan also published his book the same week.
0:08:44So, what a week. - Because why not?
0:08:47If you're gonna do both things,
0:08:48why not do them at the same time?
0:08:50- Yeah.
0:08:51It means I'm all alone over at Six Colors.
0:08:54I'm like, this is the summer of solitude for me over there now.
0:08:57Yeah.
0:08:58You're the one really struggling right now.
0:09:00Yeah, oh yeah, it's really about me.
0:09:02Not about like a baby, whatever, you know, whatever.
0:09:06But I am blogging alone.
0:09:09The big problem is that Six Colors podcast that members get
0:09:13because that's me and Dan.
0:09:14And I've gotten guests the last two weeks.
0:09:18I'm not planning that out as much as I should.
0:09:20It's like, geez, what am I going to do this week?
0:09:22Friends, I don't know what I'm gonna do this week. No idea, but we'll figure it out. I'll
0:09:27figure it out.
0:09:28I'm waiting for the call up. I know it's gonna come at some point.
0:09:31Yeah. Oh, it undoubtedly will. Like, I mean, how many people do I even know? They're all
0:09:37gonna get the call at some point.
0:09:38Actually, you're gonna have to run out.
0:09:41Yeah.
0:09:42Rumor round up, Jason Snell.
0:09:44Okay.
0:09:45Got a couple of little things this week, all coming from the Sheriff himself across various
0:09:50avenues. The first is an interview, some tidbits from an interview that Mark Gurman did with
0:09:57YouTuber Max Tech, I think has become a bit more prominent recently in our circle, I think
0:10:04is doing a lot of the thermal tests of various computers. But very successful YouTuber, but
0:10:10sometimes these people just come into our like remit somehow and this is it. Anyway,
0:10:16one of the some of the things Mark said Apple had an M1 Pro Mac Pro ready so
0:10:24like that was something that they had set they were ready to go on it but
0:10:28decided to hold off until M2 I don't know why they made that decision but I
0:10:32think that was actually the right decision. Mark is now expecting the Mac
0:10:36Pro with an M2 chip in it or M2 based chip in it not M2 can you imagine the
0:10:43Mac Pro of an M2. It's like, how's your phone was now? But no, with an M2 based something.
0:10:50M2 Extreme, M2 Max maybe. This is now expected to be announced later this year, shipping
0:10:57sometime in 2023. Fine. Okay, sure. Mark Gurman doesn't expect there to be a redesign of the
0:11:05Mac Mini. Just for there to be spec bumps in the future. I think that makes a lot of
0:11:10sense considering the way the Mac Studio looks.
0:11:12Yeah, the redesigned Mac Mini rumors were about the Mac Studio, so, and to Mark Gurman's
0:11:17credit, I think he got that right, that when he said it was like a new thing that looks
0:11:20like a tall mini Mac Pro.
0:11:22Right, but there were people that were saying it was going to have like plexiglass on the
0:11:26top and all that kind of stuff.
0:11:28Yeah, those were the weird rumors, but I think Gurman did a pretty good job of zeroing in
0:11:32on the Mac Studio, even though he, I think he described it as being a tall Mac Mini or
0:11:37a mini Mac Pro and I think he was probably more right than wrong there. So yeah, sure,
0:11:43Mac Mini is fine. It doesn't need to be reinvented.
0:11:49And once again saying that an iMac Pro is currently in active development and he expects
0:11:54it to be available next year sometime.
0:11:58Sure sounds like the bigger iMac is going to be an iMac Pro, at least in his mind. I
0:12:03think that there's marketing questions there, but I think it's interesting that that's
0:12:07That's how he refers to it.
0:12:08I mean, I wouldn't, I mean, we've had this conversation a million times and we'll have
0:12:12a million times more.
0:12:13I don't know why you would do a bigger Amek and not call it the Amek Pro.
0:12:17Yeah, no, it makes sense.
0:12:18Given what, how they name their products, it's going to be more expensive.
0:12:21It's probably going to have more capability in terms of the chips that are available on
0:12:25it.
0:12:26And so sure, why wouldn't you?
0:12:29Speaking of products that might get bigger and potentially called Pro, the rugged Apple
0:12:33Apple Watch Extreme as we've called it around here but could be called Apple Watch Pro apparently
0:12:39is one of the names being suggested.
0:12:41In Mark's Power On newsletter he gave a few more details about this.
0:12:45So we spoke some time ago whether it was last week or the week before I don't remember because
0:12:51we prerecorded that the rugged Apple Watch would be made of metal which wasn't what we
0:12:57were expecting.
0:12:58We were thinking we had Casio G-Shock in our minds right?
0:13:01Cover that thing in silicon.
0:13:03but no, they will be made of metal,
0:13:05and Mark is now expecting it to be some adjusted formulation
0:13:09of titanium to make it even more durable.
0:13:12-Yeah, see?
0:13:14It's the pro-materials, pro-watch.
0:13:18-I'm listening to "After Steve," the book about --
0:13:23I thought it was about Johnny Ive,
0:13:25but it's also about Tim Cook.
0:13:26I don't know why my brain -- -It's 'cause of the marketing.
0:13:29-I think you're right, right?
0:13:30Like all of the excerpts seem to be about Johnny Ive.
0:13:33And so it's about the both of them.
0:13:35But one of the things they were,
0:13:37I just heard a couple of days ago when listening to it,
0:13:39they were talking about how they reformulated,
0:13:42like formulated their own gold for the Apple Watch.
0:13:46And I also remember, and I've heard over time,
0:13:50that Apple, because of the Apple Watch,
0:13:52kind of hired and then created their own like
0:13:55metallurgy team.
0:13:56And so like, this is a thing for them.
0:13:59Like they create new formulations of metals
0:14:02to do what they need them to do.
0:14:05- Yeah, they were already, I mean,
0:14:06I read something at some point that said that
0:14:08Apple might have the best collection of people
0:14:11who understand how to use aluminum in the world.
0:14:14- Yeah.
0:14:14- That they had already, and it makes sense, right?
0:14:16Like they've been basing their computers on aluminum
0:14:19for 12, 13, I mean, it's been a long time now
0:14:24and I've heard that that is one of the things
0:14:26that they have gotten very good at
0:14:28is exactly what kind of aluminum they want.
0:14:31And then remember, they started boasting
0:14:33about this specific kind of stainless steel they used
0:14:37in the Apple Watch or in the ring around the iPhone Pro.
0:14:40Like they have metallurgy opinions.
0:14:44And so was it surprising that they might do
0:14:46a reformulated titanium that they feel
0:14:48they can boast about on stage
0:14:50as being extra rugged and resilient?
0:14:52I'm not surprised at all.
0:14:53- Mark also said that this Apple Watch will be a quote,
0:14:57good bit bigger so it might only appeal to a subset of customers. I wonder what the story
0:15:04is going to be for the size change because like just as I think about it, I don't understand
0:15:08why a watch for extreme sports needs to be bigger. So I'm intrigued what they're going
0:15:14to say as to why that is.
0:15:17I think it's not going to be that complicated. I really don't. I was having this chat with
0:15:20somebody else the other day. I think that if we think of this as Apple Watch Pro and
0:15:26we think of it as a bigger Apple Watch, everything else falls into place, which is why is it
0:15:31bigger? Well, because we're giving you three different versions now. There's the two smaller
0:15:36versions and then there's the Apple Watch Pro, which is bigger. It has more battery.
0:15:39It has a bigger screen. You can see more stuff. Yay. Like, I really think that that's all
0:15:44the explanation that there's going to be is now we have three sizes of watch. And the
0:15:48most expensive one is this big fancy one with the great materials. And let me tell you the
0:15:53story about, you know, why it's great, but I don't know if there'll be more of a size
0:15:59change than that, then that it's a bigger screen and more battery and those are things
0:16:04that people like.
0:16:05I 100% think that you are right there, but I'm just intrigued if they're gonna have some
0:16:10other like reason that they, you know, maybe there's something that they're gonna do in
0:16:16software where you can see more of the workout or whatever, I don't know.
0:16:21I don't know. I think the thing to keep your eye on,
0:16:24I think as we're all watching this event,
0:16:26when it unfolds in September, presumably like the sixth,
0:16:31maybe the 13th, something like that.
0:16:34I haven't heard a rumor about that yet,
0:16:37but it's always about the same time.
0:16:39The thing to watch is how they talk about
0:16:43the sport component of it versus the just,
0:16:47it's an Apple Watch component of it.
0:16:48because if it's Apple Watch Pro,
0:16:51I think it's still gonna have
0:16:53a little bit of a sport narrative to it,
0:16:56but not the only narrative to it.
0:16:58That they're gonna boast about,
0:17:00well, what can we do with this battery life?
0:17:02Well, the answer is, and we made it more resilient,
0:17:05which is great for people who use it in sports,
0:17:07which they already use the Apple Watch in sports.
0:17:09You could argue that all Apple Watches
0:17:10are kind of sports watches, kind of,
0:17:13and so this is also that.
0:17:14But if they do something like is rumored,
0:17:16where they do a wilderness mode or whatever,
0:17:20where it goes into extreme battery saving,
0:17:22but it's still doing logging and you can crank it up
0:17:26and crank it down as needed.
0:17:28And the extra battery life allows it to do that.
0:17:31And maybe this is the one that does the wacky
0:17:34kind of emergency signal to the satellite
0:17:37and all of that stuff.
0:17:38There's a story they can tell about that,
0:17:40but I think they have to balance it
0:17:41with not wanting to come across as this is a sports watch
0:17:45because I don't think they want to do that because I think they probably envision that
0:17:50a lot of people are going to buy it because they like the most expensive thing and bigger
0:17:55is better and more battery life and they don't want to turn them away like, "Are you an extreme
0:18:01sports enthusiast?" "No." "Well, then you can't buy our expensive watch."
0:18:04- Yeah, I think you're right actually because also as I'm thinking, you know, for those
0:18:08of us that have been around for long enough, the aluminium one used to be called sport.
0:18:14did. Right and so like the reasoning there was like it's the cheapest,
0:18:19the lightest, you can ding it the most, it's you know like it's for sports so
0:18:23it'd be strange now to be like hey this one's for sports and it's the most
0:18:27expensive one you know so I think I'm coming around now even though I
0:18:32will always miss it if they don't call it extremes because I think that's funny
0:18:36but calling it pro is like hey if you're an athlete you can use this if you are
0:18:43work in 26 hour days you can use this and it's gonna protect you about you
0:18:48know you and I have the battery life that you want like maybe just pro as in
0:18:52biggest bestest is probably what they'll go with because that's what they do. I
0:18:56think it's the most logical way to approach this especially if it's
0:19:00titanium and is gonna look like a big Apple watch and not look kind of weird
0:19:04and different then it's just an addition to the product line I think that's all
0:19:09it is. Zach in the Discord says Apple Watch Max which could also fill the
0:19:13fulfill the same thing especially if it's gonna be physically bigger because
0:19:17then that matches what the iPhone will be because it's probably hmm I wonder
0:19:25what they'll do you think they'll call the bigger regular one iPhone 14 Max? Yes.
0:19:32So then that Apple Watch Max could work just as nicely. Could be, could be. I also
0:19:37wonder how it's going to be positioned in relationship to the other Apple
0:19:41watches, because you could also say we have three sizes of Apple Watch now and
0:19:45just say that. Probably not. They'll probably differentiate in some way. So
0:19:50yeah, Apple Watch Max could be. Could be. But I think Sport is, you know, Sport is
0:19:55probably not on the agenda for this one. An evolution of the current rectangular
0:19:59shape, no flat size. Yeah. This is, this is just gonna be a big Apple Watch with a
0:20:04a big screen and a big battery,
0:20:07and then maybe some features that are enabled.
0:20:10Like I said, I keep coming back to David Smith
0:20:13trying to take an Apple Watch out in the woods for a week
0:20:16and thinking there's a story,
0:20:18there's some software that you add
0:20:20and you use the big battery,
0:20:22and now you've got a story to tell about it
0:20:24as a thing you can take hiking or whatever,
0:20:27but it's just one part of the story of like,
0:20:30it's also just an Apple Watch, that's nice.
0:20:32and on a redesign, adding in a new watch this year
0:20:36gives them another year until they need to do a redesign.
0:20:38Right, like they can just be like,
0:20:40hey, we added a new one
0:20:42and they can just keep pushing that redesign off
0:20:44into the distance, which makes me sad.
0:20:46- Yep.
0:20:47- This episode of Upgrade is brought to you
0:20:50by our friends over at Sourcegraph.
0:20:52So you've hired a brilliant developer,
0:20:55someone new to your team.
0:20:56It's awesome, but now you have to get them onboarded.
0:20:59If your company's growing, onboarding new developers
0:21:01be a common occurrence, but it's a big undertaking every time.
0:21:05One of the biggest challenges for new hires is to get up to speed with their new projects
0:21:10that they're going to be working on with their team.
0:21:12This can be tricky if the codebases that your developers are working in are already large.
0:21:16Well thankfully Sourcegraph makes it easy to move fast, even in those big codebases.
0:21:22Developers know that knowledge is most useful when it's findable.
0:21:25Centralisation can be helpful, but given the fact that most companies store knowledge in
0:21:30in at least two different locations, how are you going to access what you need when you
0:21:34need it?
0:21:35As a code intelligence platform, Sourcegraph gives developers what they need to drive their
0:21:39own learning over time and in different situations.
0:21:42Teams without Sourcegraph need to rely on asking colleagues or reviewing out of date
0:21:46documentation.
0:21:47This is cumbersome, it's time consuming.
0:21:49But with Sourcegraph, every developer can search across millions of repositories to
0:21:52find specific code, saving time for themselves and everyone else.
0:21:56So when questions do come up, you know it's the big stuff that's worthy of the extra
0:22:00time.
0:22:01Sourcegraph was created to make developers lives easier, and today they work with leading
0:22:05companies across every industry including 3 out of the 5 top tech companies, plus PayPal,
0:22:10Uber, Plaid, GE, Reddit and Atlassian.
0:22:14Visit about.sourcegraph.com to learn more.
0:22:17That's about.sourcegraph.com to find out why some of the biggest tech companies in
0:22:21the world use Sourcegraph and to see what it can do for yours.
0:22:25just click the link in the show notes to let them know that you heard about them from this
0:22:29show. Thanks to Sourcegraph for their support of this show and Relay FM.
0:22:33Apple earnings time Jason Snell charts day big charts day around here what what
0:22:42they was this Thursday of last week I think yes yeah that's it so let me give
0:22:49some top-line reporting and we can break into some of this 83 billion dollars in
0:22:56revenue that is up 2% year-over-year 19.4 billion dollars in profit that's
0:23:02It's down from $21.7 billion this time last year,
0:23:07this quarter last year.
0:23:09iPhone was up 3%, the Mac was down 10%,
0:23:12the iPad was down 2%, services up 12%,
0:23:17but for the first time, it is down $200 million in revenue
0:23:23from the previous quarter.
0:23:26I wanna dig into that in a little bit in a minute.
0:23:29Wearables were also down 8% year over year.
0:23:32It's not the first time, by the way.
0:23:33Two years ago, they had a sequential drop
0:23:35between Q2 and Q3.
0:23:37So it hasn't gone down, but it is not the first time
0:23:42that it's had a little bit of a sequential drop.
0:23:44It hasn't done a year over year drop
0:23:46since we've been watching it.
0:23:48But it did do a sequential drop two years ago
0:23:50at the same time.
0:23:51So it seems to be a thing that happens
0:23:53is that Q3 is just weaker than Q2 for services.
0:23:56- Interesting.
0:23:57It's just interesting to see now
0:23:58because it's been multiple years
0:24:00of this just like massive, just continual growth.
0:24:05That was where it stuck out to me
0:24:08and I didn't notice that one.
0:24:08So thank you for the correction there, Jason Snow.
0:24:11- It was a very similar one two years ago.
0:24:12They were 13% year over year up,
0:24:15but down sequentially just a little bit.
0:24:17- I'll be keen to see if this continues
0:24:20the way we would normally expect it to,
0:24:22which is just to keep going up.
0:24:23And it's just for some reason,
0:24:24we just ignore this one that goes down.
0:24:26But it stuck out to me as it's been multiple years then,
0:24:29not never, but it's been multiple years
0:24:30since we've had this.
0:24:32And it's one of those things where I kind of can't
0:24:35put my finger on why.
0:24:37- So I think they said that part of services,
0:24:42believe it or not, is ad revenue from search ads.
0:24:48- Oh, I do believe it, yeah.
0:24:50- So I think that they say that that is where
0:24:53some of this came from,
0:24:56is that there was weakness in the ad market.
0:24:58- This makes me annoyed 'cause I hadn't considered this.
0:25:01'Cause did you see last week that they're adding ads?
0:25:06- More ads.
0:25:06- In the App Store in more places now?
0:25:09- Yes.
0:25:10- And now I'm expecting that this is in response to that.
0:25:13- Could be.
0:25:14- And that makes me just, just stop Apple, come on.
0:25:18- I hate ads in the App Store, I hate it.
0:25:21- I shouldn't do this.
0:25:22- They spin it, somebody asked them on the call,
0:25:24it was in my little Mac world piece,
0:25:25I gave some awards out.
0:25:28I like to occasionally give awards out to analysts
0:25:31for the various attempts they do
0:25:32to make Apple answer their questions,
0:25:36which they don't answer.
0:25:37But I wanted to give Richard Kramer of REACH Research
0:25:42a little gold star.
0:25:46He asked a very pointed question about app,
0:25:48he may be not asked back after this,
0:25:52about app tracking transparency
0:25:54and how it was related directly
0:25:56to Apple's own App Store search advertising, right?
0:26:00'Cause it's not a third party ad
0:26:02if we serve it to you ourselves, right?
0:26:06So, you know, that's the argument
0:26:07about Apple's policy toward Facebook is that,
0:26:10although they talk about privacy being a human right,
0:26:12the other thing they're doing
0:26:13is basically making the only place you can market apps
0:26:16be in the App Store and Apple sells all the ads there.
0:26:19And so this was a pointed question,
0:26:22I think a good question.
0:26:24And Tim Cook's response was, he read the boilerplate
0:26:26about privacy being a fundamental human right.
0:26:28And then he said, "Search ads are great for the developers
0:26:31because they can reach people who are looking for apps."
0:26:35That was it, that was all he said.
0:26:36And I think search ads are awful
0:26:39and they're only good for Apple.
0:26:41And because the reason I think they're awful
0:26:44is because it means that if you're a developer,
0:26:46you can't just develop your app.
0:26:47You actually have to take some of the money
0:26:49that you make from your app
0:26:50in order to advertise on the name of your app
0:26:55in order to have your app come up
0:26:58when people search for your app.
0:27:01And I think it's offensive and stupid.
0:27:03And it is, yeah, it's one of my least favorite things
0:27:07that Apple does is App Store ad revenue.
0:27:09And yes, they are doubling down.
0:27:10They have now added, if you scroll down
0:27:12in an app's description page, not on search,
0:27:15and it's down toward the bottom,
0:27:17but you literally, there are ads down there.
0:27:19There's like other apps from this developer,
0:27:21and then right below it is basically,
0:27:23these are ads, probably for their competitors.
0:27:26- But then I think the worst that they're adding
0:27:28is they're going to be adding the ability
0:27:30for somebody to have an ad in the Today page.
0:27:35And you can kind of, and it kind of looks like
0:27:39Apple's official content that they make.
0:27:42Like it's got one of those big squares.
0:27:44- Yeah, but it's an ad.
0:27:46It annoys me because all advertising is advertising
0:27:50and I really don't like these two things happening at once.
0:27:54I don't like the way it looks, right?
0:27:56Like I don't like Apple kind of kneecapping other companies
0:28:01and then also increasing their own ad opportunities.
0:28:07- No, it's quite a racket.
0:28:08I mean, I'm sure I'm aware of the arguments
0:28:11for doing App Store advertising,
0:28:14but fundamentally, I think it is Apple applying
0:28:17an additional tax to its own developers.
0:28:21And as much as it boasts about,
0:28:23Apple will boast about advertising revenue,
0:28:26and it will boast about the money it gives to developers
0:28:29as part of the, you know, and I phrase it that way,
0:28:31I guess, on purpose,
0:28:32'cause Apple does sometimes view it as being
0:28:34that they're giving it to developers.
0:28:35The developers earned it, and then Apple took a percentage,
0:28:37and then the rest of it goes to developers.
0:28:39But my point here is, those two things are related,
0:28:42'cause all that money that they're getting in ad revenue
0:28:45for app advertising, it's coming out of that pot.
0:28:48It's deducted essentially
0:28:51from what the app makers are making.
0:28:54So it's a way for Apple to eat even more
0:28:57into the business of app developers.
0:29:00And it's because they've got
0:29:01an increasingly captive audience, right?
0:29:05Because marketing your app on Facebook
0:29:07doesn't really work anymore
0:29:08in the era of app tracking transparency.
0:29:10You really have to go to the source, which is Apple.
0:29:12And while that is more private,
0:29:14it also is awfully good for Apple.
0:29:16- But anyway, getting back to the topic at hand,
0:29:20this is the Q3, for the Q3 2022 results.
0:29:2549% of the revenue was iPhone, 24% services,
0:29:3010% wearables, and a Mac and iPad, but 9% each.
0:29:34So this was again, another record set in quarter for Apple,
0:29:38but it doesn't really feel like one to celebrate.
0:29:42- Right, it's a, I mean, the Wall Street response
0:29:46seemed to be relief because there's been so much difficulty
0:29:49in Wall Street, in the stock market,
0:29:53in the tech sector of the stock market especially,
0:29:56that Apple coming out with results that are fine
0:29:59was a relief 'cause they were afraid
0:30:01they were gonna be not fine.
0:30:02And the fact that the iPhone posted a 2% year over year gain
0:30:06that you could hear the size from Wall Street, right?
0:30:09(laughing)
0:30:10'Cause it's the most important product
0:30:11for the most valuable company, and it didn't take a dive,
0:30:15and they were really relieved.
0:30:17And if you listen on the call, what Tim Cook said was,
0:30:22if you look at the iPhone and try to imagine
0:30:25what are the macroeconomic conditions,
0:30:27what are the headwinds, as they like to say,
0:30:28what are all the problems,
0:30:30do we see any evidence in the iPhone
0:30:33that there are lots of troubles globally, economically?
0:30:37And he said, there are none.
0:30:39If you just look at the, he says,
0:30:41I'm not saying there aren't.
0:30:42I'm saying that if you were to look at the numbers,
0:30:45you can't see it.
0:30:46It was just a good iPhone quarter.
0:30:50Other categories you could see it, but not,
0:30:52wearables, he said specifically,
0:30:54like if they feel like the macroeconomic conditions
0:30:56really are what whacked wearables.
0:30:58And wearables had its worst quarter in ages.
0:31:01It's been up every quarter year over year for years now,
0:31:05and it was down.
0:31:06But the iPhone did okay.
0:31:08And honestly, so much of how Wall Street views Apple
0:31:12and Apple's business, rightfully so,
0:31:13'cause it's half or more of Apple's business, it's iPhone.
0:31:17And so if iPhone did okay, they're like,
0:31:19"Okay, all right, it's gonna be okay.
0:31:21iPhone's okay, everybody, it's okay."
0:31:23- So Apple had previously forecast
0:31:25that they would lose somewhere
0:31:27between four to $8 billion in sales this quarter
0:31:30for just stuff they couldn't fulfill.
0:31:32But it ended up being just shy of that 4 billion.
0:31:35So it was even better.
0:31:37as is typical for them, like they make a regent
0:31:41and then they always perform slightly better.
0:31:43- I mean, they do some sandbagging.
0:31:45I think that this was legit though.
0:31:46I think that they were surprised when they made their,
0:31:50it's not really a forecast,
0:31:51but when they made their statements three months ago,
0:31:53they were in the midst of,
0:31:55or just coming out of shutdowns in Shanghai.
0:31:58There were COVID shutdowns in Shanghai
0:31:59at the factories there.
0:32:00And they were really concerned about supply.
0:32:04Because again, this is a number,
0:32:05four to eight billion is what they said.
0:32:06It was literally, there's $4 to $8 billion
0:32:09we're gonna leave on the table
0:32:10where people wanna buy our products
0:32:11and we can't sell them products
0:32:13'cause we don't have them in our hands to give them.
0:32:15And what ends up happening,
0:32:19I thought one of the other telling moments
0:32:21in the analyst call afterward is,
0:32:25so the Mac gets assembled there.
0:32:27The bulk of Macs are assembled in Shanghai.
0:32:29So unlike other Apple products that are put together
0:32:33in other places in China, we think of China as a monolith,
0:32:36but it's not, there are factories
0:32:37in all sorts of different places.
0:32:38Most Mac assemblies in Shanghai,
0:32:41and the Shanghai shutdowns happen is really bad for Apple,
0:32:44really kind of stopped Mac production.
0:32:46We all know, you order a Mac the last few months,
0:32:49it's been like, good luck,
0:32:50you'll get it in two months or three months.
0:32:53It sounds like what happened is that those things
0:32:56have started to resolve and they resolve faster
0:32:58maybe than Apple had anticipated
0:33:00when they made the $4 to $8 billion prediction.
0:33:02And this all comes out of a statement that Tim Cook made
0:33:04when somebody said, "Geez, the Mac had a really good run
0:33:08there, but now it's down 10% this quarter.
0:33:11What's going on?"
0:33:13And Tim Cook's response was something like,
0:33:15"Ha ha, oh, you should have seen it before.
0:33:18We were really happy to get it to 10%."
0:33:20So apparently the Mac was really down.
0:33:23And then at the very end, they kind of pulled it out.
0:33:25And I think that's probably where the,
0:33:27we ended up under 4 billion in terms of stuff
0:33:30we left on the table.
0:33:31I think that maybe is where it came from,
0:33:33is that the Mac bounced back a little bit faster
0:33:36than they had feared.
0:33:37And so what a way to spin a 10% down year over year number
0:33:40for the Mac is to basically say,
0:33:42"Look, this is not about Mac demand.
0:33:44This is entirely about Mac supply."
0:33:46And somebody said, "Well, what's the demand like?"
0:33:48And they're like, "Huh, can't measure demand
0:33:51if you don't have any supply.
0:33:52Like we literally couldn't even tell you.
0:33:55We're just guessing."
0:33:56So I wouldn't say it was a bad quarter from the Mac
0:33:59in that way, because I think that people wanted to buy Macs
0:34:03and they just couldn't.
0:34:04And then the only question is, did they lose those people?
0:34:06Did those people not buy a Mac
0:34:08and buy something else instead?
0:34:09Or are they just in the queue waiting for their Mac to ship?
0:34:13- CFO Luca Maestri created a great band name,
0:34:16Cocktail of Headwinds.
0:34:18That was how Luca-- - Yep, the Cocktail
0:34:20of Headwinds.
0:34:21- Described the various issues.
0:34:25- It's quite a mixed metaphor, Cocktail of Headwinds.
0:34:28How do you put wind in a cocktail?
0:34:29And the ingredients of the cocktail,
0:34:31It's year over year sales in Russia,
0:34:34because there's no sales in Russia anymore.
0:34:36They kept referring to it as like the situation in Russia
0:34:38or whatever, but it's like they shut down in Russia.
0:34:41So that's one.
0:34:43It is supply chain, but that's broken in two.
0:34:45It's the factory assembly supply chain stuff
0:34:48that they dealt with that we just talked about.
0:34:50And also the ongoing Silicon shortage as they call it,
0:34:54or as we like to call it here, the legacy nodes.
0:34:57- Legacy nodes.
0:34:58- Those legacy nodes,
0:34:59They're just out there being legacy nodes
0:35:01and it's sometimes hard to get that Bluetooth chip
0:35:04that you want or that wifi chip that you want
0:35:08or whatever it is that's just a not interesting piece
0:35:11of silicon, but they're hard to come by right now.
0:35:14So those are part of the headwinds.
0:35:16Foreign exchange is a headwind.
0:35:18The dollar is very strong right now.
0:35:20You may have noticed this, Myke.
0:35:22Dollar's very strong right now.
0:35:24- Yeah, I got a pay bump.
0:35:26- Yeah, it's nice, nice for you.
0:35:28- It's good for me.
0:35:29It's bad for Apple in the sense that it makes
0:35:31Apple's products either more expensive elsewhere
0:35:34or less profitable.
0:35:36- I wouldn't say it's bad.
0:35:37Like what I will say is yes,
0:35:39I'm sure that's a thing for them.
0:35:41I would argue that Apple way over adjusts sometimes.
0:35:44Like some of the product prices when you do the dollar
0:35:47to like the pound to dollar conversion,
0:35:49they are making good money.
0:35:51- I agree.
0:35:52But the point is that when the dollar gets stronger,
0:35:54that good money becomes less good.
0:35:57- Yeah, but they just adjust it.
0:35:59- They don't worry about that. - So this is what I'm saying.
0:36:01This is exactly what I'm saying.
0:36:03Either they adjust their prices in market,
0:36:04which makes the product less attractive,
0:36:08or they're eating profit, and those are their choices.
0:36:11So what they do is they do stuff like they hedge,
0:36:14they buy a bunch of foreign currency
0:36:15so that if the bad stuff goes up,
0:36:18their other stuff goes down,
0:36:19or reverse, if the bad stuff goes down,
0:36:21their stuff goes up, and they kind of level it out.
0:36:23They're making a bet on foreign currency
0:36:26basically to just counteract the effects.
0:36:28But foreign exchange is a headwind, it's in the cocktail,
0:36:30and they said it could be as much as like $5 billion
0:36:33difference to their bottom line next quarter,
0:36:36because the dollar is so strong right now.
0:36:38And if you're an American company trying to sell products
0:36:40overseas, a strong dollar is not the best for you.
0:36:43So yes, they're doing okay, but it is a headwind, right?
0:36:47Because it makes everything a little more difficult
0:36:49'cause your product is either more expensive
0:36:51or less profitable.
0:36:53And those aren't good, those aren't what companies want.
0:36:56- And of course, you know, talking about the demand side,
0:37:00they are not aware of the fact right now
0:37:03as if inflation or what do we call it, economic downturn,
0:37:08is potentially affecting the demand
0:37:10of some of these products, right?
0:37:11'Cause they can't supply them anyway,
0:37:13so they don't even know.
0:37:14- They don't know, right?
0:37:15If you saw flagging interest in a MacBook Air
0:37:17or something like that,
0:37:18you would have to have MacBook Airs to sell.
0:37:21Otherwise you can't measure that.
0:37:23and they're only coming back now to being able to do that.
0:37:27- Yeah, like I just, I looked at it,
0:37:28I priced out like a MacBook Air today,
0:37:30or kind of middling spec, end of August,
0:37:33what you, before you'd get it.
0:37:35- Yep.
0:37:36- Apple is expecting less supply constraints
0:37:38in the coming quarter,
0:37:40which would be Q4, and that won't include iPhones, will it?
0:37:47- It will probably only include a very small amount,
0:37:52it depends on when they ship, but a very small amount.
0:37:53It could include the first orders, right?
0:37:57It could.
0:37:58Like the pre-orders?
0:37:59Depends on when they ship, when that quarter closes,
0:38:02'cause that quarter will close in late September.
0:38:04So probably not a lot, a little bit, but not a lot.
0:38:07And then the rest of them go into the holiday quarter,
0:38:09which is their age quarter.
0:38:10Into the holidays, yeah.
0:38:12Okay, so it could, but what it will include
0:38:15is MacBook Airs, right?
0:38:17'Cause they're not in this.
0:38:18They missed the Q3 quarter we're talking about.
0:38:22- Okay, Tim Cook told Emily Chang of Bloomberg
0:38:26that Apple is going to be deliberate with spending
0:38:30with the threat of recession looming,
0:38:32but Apple believes in investing through downturns,
0:38:36which I guess you can do if you have all the money.
0:38:39(laughing)
0:38:40- Well, that is a classic Apple line.
0:38:42And it's also, I mean, this is the good investment advice,
0:38:44which is when the stocks go down,
0:38:47if you've got the ability, buy more stock
0:38:49because you're supposed to buy it when it's low, right?
0:38:52And how do you beat your competitors?
0:38:54As well, if they're all tightening their belts
0:38:56during the downturn,
0:38:57and you've got a lot of cash laying around,
0:39:00you can hire those people
0:39:02and get ahead on the next product cycle,
0:39:05and all your competitors have slowed down
0:39:06and you are not.
0:39:09I feel like this is all an act.
0:39:11I feel like this is Tim Cook wanting to seem
0:39:15like he's responsible for Wall Street.
0:39:18But what they're not saying is that
0:39:20they're laying people off.
0:39:21they're saying that they'll be deliberate with hiring and maybe they won't expand as
0:39:25fast. I saw a story that said like Apple...
0:39:28I didn't see layoffs but I've seen hiring freezes.
0:39:31Yeah, Apple has been increasing headcount by a lot and maybe they won't do that. I still
0:39:36don't entirely buy that because one, I think it's kind of dumb because Apple has lots of
0:39:41money and it's not like Apple... I mean Apple should be investing through the downturn.
0:39:47This is when you go for the jugular of your competitors. It's like, we got all the money,
0:39:51we can just sail right through this.
0:39:53So I think it's walking a line of like wanting
0:39:55to be responsible and seem responsible,
0:39:58but also not missing an opportunity.
0:40:00So I'm sure in key areas,
0:40:01they are gonna keep hiring as they need to,
0:40:04but maybe in less key areas, they'll slow it down
0:40:07and that's fine.
0:40:09- There are a lot of just in tech right now,
0:40:12there are a lot of company acquisitions happening.
0:40:14So there could be some of that kind of stuff.
0:40:16Apple makes lots of small acquisitions
0:40:18and this is a time to do that. - From time to time,
0:40:20as they say.
0:40:21- Actually, that was another little tea leaf reading thing
0:40:23that happened is they get asked the question
0:40:26about acquisitions all the time.
0:40:28And this time they got asked that question
0:40:30and his response was a little different.
0:40:32He was sort of like, well, you know,
0:40:35we look at stuff big and little, and we continue to do that.
0:40:39It was this weirdly like way more noncommittal
0:40:43than we usually get.
0:40:45And maybe, you know, Tim was just in a mood, maybe.
0:40:49- He was mad to be there.
0:40:50But I definitely saw, or maybe he was just feeling fine,
0:40:54feeling calm.
0:40:55And so he was like, yeah, whatever.
0:40:57But I definitely saw several people on Twitter who were like,
0:40:59wait a second, did other people hear what I heard?
0:41:02And it's like, I heard the tone difference.
0:41:04It might not mean anything,
0:41:05but if you're reading the tea leaves,
0:41:06you gotta at least consider the possibility
0:41:08that maybe what he was saying is,
0:41:11well, maybe what he's saying is,
0:41:12yeah, we are or have seriously considered larger
0:41:15and larger acquisitions.
0:41:17'Cause that's the other thing they could do, right?
0:41:18is if there's a competitor who Apple can swallow
0:41:23that normally would be too expensive
0:41:25but their stock took a hit, like, I mean, Netflix,
0:41:29they could do it.
0:41:31- Please, can we not go back?
0:41:33- I know, I don't wanna go back there,
0:41:35but that's the thing.
0:41:37And I think maybe this is the answer
0:41:38is maybe Apple doesn't wanna go back there either,
0:41:40but you're Apple, you got all the money,
0:41:43Netflix takes a huge stock hit.
0:41:45You gotta look, right?
0:41:47You gotta kick the tires and say,
0:41:48"Well, should we do this?"
0:41:49And maybe that's what Tim Cook's tone was.
0:41:51It's not like we don't consider it,
0:41:53but we generally don't do it.
0:41:55And they don't, Beets was their big acquisition, right?
0:41:58So I don't know, I'm just saying,
0:42:01I thought that was interesting that they talked about it.
0:42:03And when you talk about investing through a downturn,
0:42:05that is one thing you could potentially see Apple doing
0:42:08is if there is a competitor or a good fit
0:42:12that looked too expensive for Apple,
0:42:15and then they get hammered in their stock,
0:42:17Guess what?
0:42:18That's a good time for Apple to come in
0:42:20and swallow them whole,
0:42:22which they could do if they wanted to.
0:42:24- Outside of Netflix,
0:42:25is there anyone that you would consider for them?
0:42:29- I don't know.
0:42:30I mean, I feel like their entertainment stuff,
0:42:35it's possible that they could buy somebody
0:42:40who's got a big catalog of content
0:42:42and intellectual property.
0:42:44They would have to divest of a lot of legacy stuff
0:42:46like TV stations and stuff.
0:42:48So that's out there.
0:42:50Look at areas where they're interested,
0:42:51where they think that they could add something.
0:42:53I mean, Netflix is a place where they are playing,
0:42:55so it's possible.
0:42:57If you look at, somebody in the Discord mentioned Peloton,
0:43:01like maybe, right?
0:43:06If they're really kind of feeling crappy
0:43:09and Apple thinks that there's value to sort of suck them in
0:43:11and turn that into more Apple fitness,
0:43:14Peloton already announced that they're gonna
0:43:15outsource the making of the bikes too so you could literally turn it into a
0:43:18service business and and work with partners and walk away. I'm not sure that
0:43:23I'm not sure Peloton I don't think Apple Peloton makes a good fit I think Amazon
0:43:27Peloton is a better fit or Google. Yeah oh for sure I I mean let me just put it
0:43:32this way I don't think anything's a good fit for Apple I really don't I don't
0:43:37think anything's a good fit for Apple because Apple is so specific somebody in
0:43:43I mean, Joe Steele mentioned Paramount.
0:43:46It's like, yes, I think that Paramount or NBC Universal
0:43:49or something like that, where it's like,
0:43:51somebody just wants to unload or sell
0:43:53and Apple will write a big check.
0:43:54Although I think Apple's right now content
0:43:56to write big checks for sports rights
0:43:58and other stuff like that.
0:43:58- And just content in general.
0:44:00I don't think they need to buy catalogs.
0:44:01I think they're happy just bidding a lot of money
0:44:03for movies and TV shows.
0:44:05- Right, the only thing would come
0:44:07if they wanted a franchise,
0:44:08if they wanted to own some franchises and stuff like that.
0:44:10But like, they don't want to own CBS, right?
0:44:12They don't want that.
0:44:13They don't want a TV network.
0:44:15So I don't know about that.
0:44:17And yeah, Peloton or Netflix,
0:44:20like would they be good fits at Apple?
0:44:21I don't think they would be.
0:44:23I'll throw in another one that somebody mentioned
0:44:25in the Discord that I think is actually
0:44:27might be a better fit for Apple.
0:44:30I don't think it'll ever happen, but it's Tesla.
0:44:33Like if Apple really wants to be in cars, there's a--
0:44:35- I was gonna say a car company, right?
0:44:37Like-- - Yeah.
0:44:38- Yeah, or Rivian. - Yeah.
0:44:40- You know, especially if their stock is really down,
0:44:43Because the advantage is, well, Polestar is owned by a traditional car company, though.
0:44:47But Tesla and Rivian are kind of out there on their own.
0:44:50And again, if the purchase price was right, because that stock got hammered for some reason,
0:44:57and Apple wants to be in cars, well, guess what?
0:45:01Like, there are already two, at least, tech startup, maybe three if you throw in Lucid,
0:45:08Tech startup, Apple's former PR head,
0:45:12is the PR head at Lucid by the way.
0:45:14Natalie, wow, she changed her name back to her maiden name.
0:45:19Anyway, she's there, so she knows all about it.
0:45:22You could do something like that, right?
0:45:24Where Project Titan's like, "Oh, I don't know."
0:45:25It's like, well, there are other companies
0:45:26that are actually selling cars today
0:45:28that are kind of Apple-y, kind of,
0:45:30but doing their own thing that you could bring in
0:45:32if you really wanted to do that.
0:45:34But I think this is the fallacy of Apple acquisition talk,
0:45:36which is most of them are bad ideas.
0:45:38I'm sure they all get thrown around in Tim Cook's office
0:45:41and then they go, nah, and then they move on.
0:45:44And then what Apple really prefers to do
0:45:45is those strategic buyouts.
0:45:48But never say never, right?
0:45:49Like if there is, everything's got a price, right?
0:45:52I am sure, I'm sure there's a stock price
0:45:57at which Apple would say,
0:45:59maybe we should buy Netflix or Tesla or whoever, right?
0:46:03I'm sure there is,
0:46:04but it's probably lower than you think it is.
0:46:07Probably Apple is not willing to go as high as you think
0:46:09because the cost of integration is really high.
0:46:12Apple has a very specific culture.
0:46:14Apple has very rarely played that kind of game
0:46:18where they like to buy people in technology
0:46:22that are smart and integrate them into the Apple machine,
0:46:24not just take something off of a retail shelf
0:46:27and say, "Oh, it's Apple now."
0:46:28- I don't want to be that guy 'cause I'm reading a book,
0:46:30but I just wanted to bring this up
0:46:32because it came up in the book, the After Steve book,
0:46:34where they are talking about the Beats acquisition, right?
0:46:37And that one made a lot of sense
0:46:41because what they wanted was Beats Music
0:46:43because Apple was starting to fall behind
0:46:45and they apparently were trying to build
0:46:47their own streaming music service
0:46:49and it wasn't really getting far enough
0:46:53and Tim Cook liked Beats Music and they just wanted that
0:46:56but Jimmy Iovine wanted Apple to take all of it
0:47:00they could get a lot of money out of that. And so they just packaged the whole thing
0:47:04up and bought it. And then they got Beats and it's just like they've been able to, I
0:47:08think they've actually been able to benefit from that quite a lot. And then they also
0:47:12got Beats Music, which they turned into Apple Music. And so for me, I could only ever really
0:47:18imagine them making a very large, splashy acquisition with that idea in mind. That's
0:47:23why I don't think Netflix, because I don't think Apple owning Netflix would really help
0:47:30them in the ways that they want Apple TV to be.
0:47:33Right. And then they would have to be, you know, then they would be running the Netflix
0:47:37business.
0:47:38Which I don't think they want to do.
0:47:39They, I don't think is necessary. I agree. In fact, what you just described sounds much
0:47:43more like an electric car company, right?
0:47:45Yes. And that's why I was bringing it up.
0:47:46Which I think they've been trying and trying and trying to do when they haven't succeeded.
0:47:49By the way, it's a follow-up.
0:47:50And they need to follow up. And they need technology. And they don't have it right now.
0:47:53And you could just pick it up and suddenly you've got factories and cars.
0:47:57Yep.
0:47:58and a technology stack that you can keep or throw away
0:48:00as you see fit.
0:48:02So Polestar, by the way, was owned entirely by Volvo
0:48:06and they took it public.
0:48:08So I'm sure Volvo still has very close ties
0:48:10and owns a lot of it, but okay,
0:48:11we'll throw that on the list, that's fine.
0:48:13But like that, something like that is, I don't know.
0:48:15I mean, we're gonna, our next segment is all about CarPlay
0:48:20and Apple's ambitions in the auto,
0:48:25But I will throw that out there just as an aside
0:48:29that if there's any place I could see Apple making
0:48:31a big high profile acquisition, it is cars,
0:48:36just because I think there are some car companies out there
0:48:39that are kind of independent
0:48:41and sort of what Apple's trying to do
0:48:45and that Apple might use as a shortcut
0:48:47to get where it wants to go.
0:48:48I'm not saying it's likely,
0:48:49I'm just saying that maybe that's a better fit
0:48:51than something like Netflix,
0:48:52which again, I feel like if Netflix is down in the dumps,
0:48:55Apple looks at it just to say, "Well, should we?" but I don't see why they would.
0:49:00This episode of Upgrade is brought to you by Bombas.
0:49:04Bombas' mission is simple, to make the most comfortable clothes ever and match every item
0:49:09sold of an equal item donated.
0:49:11So when you buy Bombas, you are giving to someone in need.
0:49:15Bombas designed their socks, shirts, and underwear to be the clothes you can't wait to put
0:49:19on every day.
0:49:21Everything here makes a soft, seamless tagless and has a cozy feel.
0:49:24There is a pair of Bombas socks for everything you do. They come in tons of options, like
0:49:28comfy performance styles made with sweat wicking yarns, which mean that your feet stay cool
0:49:33while the rest of you works up a sweat, and their no-show socks are designed for comfort
0:49:37while being specifically engineered to never fall down, so let your ankles be free to soak
0:49:42up the sunlight. Bombas' t-shirts are made with thoughtful design features like invisible
0:49:47seams, soft fabrics and the perfect weights that they hang just right. Bombas' underwear
0:49:51is breathable, it fits well and has a barely there feel. You might even forget they're
0:49:55there, but in a good way.
0:49:57And did you know that socks, underwear and t-shirts are three of the most requested clothing
0:50:01items at homeless shelters? That is why Bombas donates one for every item you buy. So far
0:50:06Bombas customers like you have helped donate over 50 million items of essential clothing.
0:50:12I adore my Bombas socks. I wear their no-show socks so much especially in the summer. They
0:50:18They are the most comfortable socks I've ever worn.
0:50:21They're really well made and I love that they have this kind of padding at the back on the
0:50:25ankle.
0:50:26It works really well as somewhere to pull your socks up when you're putting them on.
0:50:30But then it also keeps things really comfortable throughout the day.
0:50:33My shoes don't rub on my ankles.
0:50:35I love it.
0:50:36It's fantastic.
0:50:37Go to bombas.com/upgrade and you will get 20% off your first purchase.
0:50:42That's B-O-M-B-A-S.com/upgrade for 20% off.
0:50:46B-O-M-B-A-S dot com slash upgrade. Our thanks to Bombas for the support of this show and
0:50:52all of Relay FM.
0:50:53All right, it is time for an upgrade, some fun vertical about CarPlay. And joining me
0:51:00now is Sam Abouel-Samid, who is the host of the Wheel Bearings podcast and somebody who
0:51:06knows a lot about the auto industry. Sam, welcome.
0:51:12Thank you, Jason. It's a pleasure to be here with you today.
0:51:14good you've been listening to my various podcasts and sending me emails and
0:51:18we've talked about this stuff and I wanted to just get you on upgrade to
0:51:20talk about all the carplay things that Apple dropped at WWDC which are almost
0:51:25like science fiction right it's like eventually at the end of next year you
0:51:30might start to see cars with whatever this thing is that they didn't really
0:51:34even give a name other than to say it's next-generation carplay it's kind of
0:51:38interesting I guess the timeframes when you're talking about the auto industry
0:51:41are a little bit like that right there they're more out there than maybe
0:51:44the tech industry is used to? Yeah, you know, a big, you know, one of the big issues with anything
0:51:50automotive is safety concerns. You know, compared to, you know, a consumer electronics device like
0:51:56a smartphone or a tablet, you have to factor in safety validation for a lot of things because
0:52:04when things go wrong, the consequences of mistakes can be life or death. You know, rarely if you're,
0:52:10if Instagram crashes on you, will it result in you dying?
0:52:14Or at least hopefully.
0:52:16But if things go wrong with software in a car,
0:52:19the consequences can be very severe.
0:52:21And so they do tend to spend more time on safety validation.
0:52:26And especially when you're looking at something
0:52:28like this new version of CarPlay,
0:52:30there's also regulatory concerns,
0:52:33particularly around the instrument cluster.
0:52:36- That's one of the things that struck me about it
0:52:37is that they are saying the new generation of CarPlay
0:52:41is going to show,
0:52:42it's gonna be able to basically control the car
0:52:44and also show status live from the car,
0:52:48which obviously modern CarPlay doesn't really do that.
0:52:52Modern CarPlay is just sort of a phone interface,
0:52:56not a car interface, if that makes sense.
0:52:59And this is something very different.
0:53:02We'll start with what was your first reaction
0:53:07when you saw Apple doing this, were you thinking,
0:53:09this is interesting?
0:53:10Were you skeptical of it?
0:53:12I mean, it's so far out there that we have lots of time
0:53:14to form opinions about what they dropped in June.
0:53:18- Yeah, both really interesting and some skepticism,
0:53:22particularly as I read what little information
0:53:25they actually provided and rewatch the video
0:53:28because they haven't actually told us a whole lot,
0:53:30but there are a couple of important details
0:53:32in what they did say.
0:53:34One is the focus that this is still running on your device.
0:53:39And this is where the skepticism comes from.
0:53:41The idea of redesigning the interface to enable it
0:53:46to work across different display form factors in the car
0:53:51is an important thing because what we're seeing now
0:53:53as we get into new vehicles is a lot more variation
0:53:58in the form factor.
0:53:59It used to be that you would have an instrument cluster
0:54:02directly in front of the driver
0:54:03And then somewhere in the middle of the car,
0:54:05you would have a display screen,
0:54:07modern vehicles, it's usually a touchscreen, but not always.
0:54:11And one rectangular, usually landscape display in the middle
0:54:16that was used for your infotainment system.
0:54:19And that's where CarPlay, and much of what I'm about to say
0:54:23also applies to Android Auto.
0:54:25They project information on there,
0:54:27as well as whatever is built into the car
0:54:29is also displayed on there.
0:54:32And the thing to remember about both CarPlay and Android Auto, as opposed to Android Automotive,
0:54:37which is something different, is that the way you can think about these two systems
0:54:44is they act sort of like device driver layers.
0:54:50Because different vehicles, you know, a lot of vehicles today have touch screens, but
0:54:54not all of them.
0:54:55Some of them have some sort of central control knob.
0:54:57Some of them have gesture controls.
0:54:58You know, you've got a variety of different interface systems.
0:55:04And what CarPlay and Android Auto do is they translate whatever the control signals are
0:55:11from the driver, whatever bit of hardware they have, whether it's a touch interface
0:55:16or a touchpad or a mouse-like device, into a common set of signals that the phone understands.
0:55:24And that interfaces with the apps on the phone.
0:55:26And then the phone projects back what is going to be displayed on the screen.
0:55:31So it acts as that intermediary.
0:55:35And my understanding of what little they've said so far, and I don't know if you've
0:55:41from any of the conversations you've had with Apple, they haven't responded to my
0:55:44inquiries, but if they've told you anything different, is that this next generation is
0:55:50still a smartphone projection system.
0:55:52the same type of approach, but tailored to be able to reformat itself to different display
0:56:01interfaces, so to project onto the instrument cluster, which is more and more often now
0:56:07a digital, an LCD display, and to portrait displays and landscape displays, and even
0:56:15one of the renders they showed that showed a pillar-to-pillar display across the entire
0:56:21dashboard, which is funny, listening to a lot of different podcasts, I heard a lot of
0:56:25people express skepticism about that one. You know, "Oh, that's, you know, something
0:56:29like that's never going to happen." Well, actually, that's actually already in production
0:56:32now in China on the new Lincoln Zephyr sedan, and it's coming to other vehicles as well.
0:56:38So that type of display does exist today and will be coming to more vehicles.
0:56:43Yeah. So one of the things about the—I had some theories, and I'm curious what your
0:56:49your theories are, but I think we should at least touch
0:56:51on Android Automotive for people who don't know about it
0:56:54and the differences there.
0:56:56And the way I got to thinking about Android Automotive
0:56:59and whether Apple would ever consider doing something
0:57:02like that is when I started to think about the fact
0:57:05that you can't ship a car without a brain
0:57:09and say, bring your own brain,
0:57:11bring your own smartphone, right?
0:57:13You can't do it. - Correct.
0:57:14- And not just the low level stuff,
0:57:16but like you can't say this car has no interface
0:57:19unless you bring a smartphone, whether it's a rental car,
0:57:21what like you need to be able to turn it on and use it.
0:57:24And something needs to run that.
0:57:26And if you've got a big touch screen on,
0:57:29or even just a display that's not a touch interface,
0:57:32all that stuff has to be driven from somewhere.
0:57:34And what Google did is build Android Automotive,
0:57:38which is this lower level operating system
0:57:42that is integrated into the car.
0:57:44It doesn't come with your phone, right?
0:57:46it's in the car and that that is a different approach.
0:57:50That's the bottom up, I guess, a little bit more
0:57:52than top-down approach that Apple has done
0:57:54and that Google has done with Android Auto.
0:57:57Have I summarized it right?
0:57:58Like what Android Automotive is?
0:58:00- Yeah, so today, most cars on the road built
0:58:04in the last decade use either BlackBerry's QNX
0:58:08or some flavor of Linux to power their infotainment systems
0:58:13and also instrument clusters.
0:58:15And these are generally set up
0:58:18as real-time operating systems,
0:58:19especially for the cluster.
0:58:20For the cluster, it has to be a real-time operating system.
0:58:23So that means that everything is tied to time slices.
0:58:28You don't need that necessarily for the infotainment.
0:58:31If something happens a few milliseconds
0:58:34or 100 milliseconds or a second later,
0:58:36it doesn't matter so much for what's on that center screen.
0:58:39But the stuff that's in front of you,
0:58:42that stuff has to be real time.
0:58:44And this is where the regulatory part comes in
0:58:46because there are certain requirements
0:58:48for things that have to be displayed.
0:58:52Like for example, alert warning,
0:58:55diagnostic warning lamps.
0:58:57When you start up your car today,
0:59:00you'll see a bunch of lamps that will flash on
0:59:02for a couple of seconds.
0:59:03That's part of the power on self test.
0:59:05And then assuming everything's okay,
0:59:07then most of those go out.
0:59:09And then when a problem is detected
0:59:12in some system in the vehicle,
0:59:13then it'll turn on one or more of those lamps
0:59:16and say, "Hey, here's what's going on."
0:59:19That same sort of stuff, that stuff is mandated by law.
0:59:24And so that has to be there.
0:59:25So there has to be, as you said,
0:59:27at least a minimal interface to begin with.
0:59:30You cannot assume that there is going to be
0:59:33any particular device that a driver's gonna bring along
0:59:35and plug into the car.
0:59:37- Right, and if I wanna turn on my windshield wipers,
0:59:40I can't be like, "Sorry, that's a feature
0:59:41"only available with a smartphone."
0:59:42You can't do it. - Exactly, yes.
0:59:44- So there has to be something there.
0:59:46And so what Google did is say, "All right,
0:59:48"can we get in there?"
0:59:51I wanna mention, by the way, you mentioned QNX
0:59:53and BlackBerry, and people may laugh a little bit
0:59:56at BlackBerry, it's the old times.
0:59:57QNX, yeah, it's absolutely used in this.
0:59:59And I'll just point out, Apple set up a whole,
1:00:03this is a story people may forget,
1:00:04Apple set up a whole building next door to QNX,
1:00:08and they didn't ever talk about why,
1:00:10and everybody assumes it's Project Titan, the car project.
1:00:12But Apple definitely at some point
1:00:16was very much interested in people
1:00:19who had experience building real-time operating systems.
1:00:22Whether they still have those people,
1:00:24who knows that Project Titan stuff
1:00:26has gone through 80 different iterations,
1:00:29but I'm just saying it's not impossible
1:00:32that Apple has had a program to build its own version
1:00:36of a real-time operating system for cars at some point,
1:00:40whether they have it, whether they did it,
1:00:41whether they gave up, I have no idea,
1:00:43but they set up an office in Canada right next to QNX,
1:00:47where they had the QNX people working.
1:00:49So it's definitely been on their radar at least,
1:00:52even if it's, I mean, who knows about today,
1:00:55but it's definitely been out there.
1:00:56- Yeah, absolutely.
1:00:58And QNX, long before it was owned by BlackBerry,
1:01:00or I think it was still called Research in Motion
1:01:03when they purchased it, when they acquired it.
1:01:05And QNX goes way back and it was designed
1:01:08from the ground up as a super reliable
1:01:11and secure operating, real-time operating system.
1:01:14So it's used in all kinds of applications
1:01:17that go well beyond consumer electronics devices or cars.
1:01:21It's used in things like clear reactors
1:01:24and all kinds of other stuff where reliability is paramount.
1:01:28- Where you can't have a bad acting app
1:01:29sort of prevent your speedometer from updating
1:01:32or your nuclear reactor from working properly.
1:01:33Yeah, it's important.
1:01:35It's kind of important.
1:01:36So what do you think?
1:01:38Knowing what we know about Apple,
1:01:40and we don't know everything, right?
1:01:42'Cause we don't know about Project Titan,
1:01:43and we don't know what their ultimate goal is,
1:01:45and we don't know what all they've tried
1:01:47and what they've ruled out.
1:01:49But I have to say, when I looked at this, I thought,
1:01:52are they gonna do their own version of Android Auto?
1:01:55And Android Auto is open source,
1:01:56and you can just take it and walk away with it
1:01:58and do stuff with it.
1:01:59and it's a very Google-y kind of thing,
1:02:01and I can't envision Apple ever doing that.
1:02:03I don't know, can you envision Apple going to automakers
1:02:08and saying, "Well, you know, we're not gonna let you
1:02:12"take the code, you know, take all,"
1:02:14or maybe some of the source code, but it's not open source,
1:02:16but like, but we're gonna go and say,
1:02:18"Why don't you use our thing instead,
1:02:20"'cause our thing is nicer, and it still does
1:02:22"all the things that Android Automotive does."
1:02:24Is that even plausible?
1:02:27I think it's plausible, but I think it's unlikely.
1:02:30And I'll tell you why.
1:02:31One of the things that they talked about
1:02:36during the presentation was they brought up this statistic
1:02:40that 79% of new car buyers insist on having
1:02:43Apple CarPlay in their vehicles.
1:02:45And that is true up to a point.
1:02:48What it's implying is that new car,
1:02:52yes, the reality is most of the people that buy new cars
1:02:57probably do want carplay.
1:02:58But you also have to consider the fact
1:03:01that the vast majority of people
1:03:03don't actually buy new cars.
1:03:04Most people never buy a new car in their lifespan.
1:03:06Most people only buy used cars.
1:03:08And used car sales outnumber new car sales every year
1:03:11by about three to four to one.
1:03:15And when you look at the, you know,
1:03:18downstream at the market, you know,
1:03:20once you get past the new car buyers,
1:03:22used car buyers are probably, you know,
1:03:26more likely to use an Android device, you know, because they're, you know, they're more concerned
1:03:30about how much they're spending. And, you know, let's be honest, you know, I'm an Android user,
1:03:34but I know that, you know, cost is a factor and is one of the main factors in why a lot of people
1:03:40use Android. It's, you know, it's not necessarily my main factor, but for a lot of people it is.
1:03:46But, and they still want to be able to have this kind of capability. And for automakers,
1:03:52Yes, they want to be able to sell those new cars to people that want to use iPhones, but
1:03:59they also are concerned about the used car buyers because that impacts what we call the
1:04:05residual value of the car, the resale value of the car.
1:04:09Once the car gets sold, once the original owner trades it in or sells it, it's going
1:04:16to be bought by somebody else.
1:04:18person may very well want to use Android Auto. And so if they did a full-blown operating
1:04:28system like Android Automotive, if Apple did this, it would really need to support Android
1:04:35Auto as well. Because if it doesn't, then that's going to have an impact on residual
1:04:44values, which impacts the automakers in terms of how they can do their lease pricing, for
1:04:50example, because that's how they figure out your payments for a lease.
1:04:54Because they're knowing the residual value they get back when they put that in a fleet,
1:04:59sell it to CarMax or whatever they need to do after the lease is over.
1:05:02Right. And I have a hard time believing that Apple would want to support Android Auto on
1:05:08their fancy new operating system.
1:05:11To be fair, Android Automotive does support CarPlay.
1:05:18So I feel like that almost there's this universal player thing, which is attaching it to a brain,
1:05:24and that maybe even – that's a great open question.
1:05:28If Apple's going to do this and get carmakers to sign on, they've got to support Android
1:05:33Auto.
1:05:34I think they would.
1:05:35If that was the only issue, I think they'd be like, "It's fine.
1:05:37It's going to be…"
1:05:38One of those typical Apple things where it's going to be like, "Well, it's better with
1:05:41an iPhone, but sure, sure, you can use your Android phone, but it's better with an iPhone,
1:05:45of course, and you should have that. All right, so possible, but not necessarily super plausible.
1:05:51I had a thought, which is like another way where Apple could do this, which is theming,
1:05:58which is like, okay, Apple's showing us a bunch of stuff, and they said, "Oh, you've
1:06:04got all these different controls you can use." And I kept thinking, like, is it all carplay,
1:06:10Or is there a scenario here where Apple basically is going to have its onboard iPhone brain,
1:06:17and then also it works with car makers to have sort of compatible themes that will make
1:06:26it seem like a seamless whole even though it's actually kind of not?
1:06:31I was trying to think like, "How else could you do this?"
1:06:33And that was one of the thoughts I had.
1:06:34It's like, "Oh, I know that that looks--oh look, I change it here and it changes it there."
1:06:39"Yeah, but is that still CarPlay or is it using the different CarPlay theme that the
1:06:45car maker has installed on their real-time operating system?"
1:06:48Yeah, no, the theming is absolutely a possibility and actually that's more plausible, I think,
1:06:55than some of the other things. Because even today, a lot of automakers already provide
1:07:01the ability to select different themes for your instrument cluster. And when you go through
1:07:07the drive modes, for example, and you go through your eco mode or your normal or comfort mode
1:07:11or your sport mode, you'll see the instrument cluster completely change the way it looks,
1:07:16you know, with different color schemes and everything.
1:07:19So I can definitely see a world where, you know, this next generation of CarPlay projects
1:07:27different themes, you know, that would integrate with whatever OS the automaker is running.
1:07:33So all the stuff that's in the cluster is still coming directly from the car.
1:07:38It doesn't have to go back through the phone and then back into the car again, but it's
1:07:45using the phone to figure out what is, for lack of a better term, what is the style sheet
1:07:51we want to apply to this data?
1:07:53And so that, I think, is a real plausible scenario.
1:07:58Because obviously this is not the kind of thing where Apple is going to roll in and
1:08:04say, "Oh, we've hacked into your system and replaced it."
1:08:08These are all like, "We're working with the car makers.
1:08:11We're going to have partners here."
1:08:13So I'm glad that you think that this is a possibility because that was when I was getting
1:08:17into my conspiracy theories about this.
1:08:19That was kind of where I ended up is, sure, it could be Project Titan and it could be
1:08:23a real-time operating system.
1:08:24I mean, it's possible, but you could do this by making partnerships with automakers and
1:08:31having something like theming or some, and maybe even a special kind of, depending on
1:08:37what operating system they're using, and that this is a year out, year plus out, some kind
1:08:43of a data channel or a back channel or something where there's special stuff that the iPhone
1:08:48can pass on to whatever operating system it's running.
1:08:51there's some sort of a, I don't know a lot about those RTOSs, but like a
1:08:54plugin architecture or a version that has the ability to communicate with the
1:08:59iPhone at a deeper level and give it more detail and have the iPhone
1:09:04send things to it, including themes and all of that, where it's more like where
1:09:09CarPlay 2.0 or whatever this is, CarPlay Advanced, is more tightly
1:09:16integrated with the car's existing real-time operating system if it's a
1:09:20partner that has worked with Apple on that. And the advantage of that for the
1:09:25car maker is they look good working with Apple without having to give up that
1:09:31part of their car to Apple because it opens up that can of worms of like well
1:09:36then what does it look like when the Apple product isn't there? Is it super
1:09:39generic? What about Android? Is that the most plausible scenario of what Apple is
1:09:45not describing when they show this and don't tell us what's happening? Is that
1:09:48the most plausible scenario? I think so and and you know to give you an example of how
1:09:53that might work, last fall GM announced something that they call Altify, which is their new
1:10:00application platform for vehicles and it's rolling out next year starting with the new
1:10:03Chevy Blazer EV. And essentially what this is, you know, if you know how Android is structured,
1:10:10it's running Linux underneath and there's this layer, this application, this API layer
1:10:17But, and I think iOS is fairly similar.
1:10:22You've got the kernel underneath, and then there's this layer of APIs that applications
1:10:27can get data from and then send commands to.
1:10:32And this is what GM is doing as they move to a more centralized computer architecture.
1:10:37Today, vehicles, most vehicles have anywhere from 50 to 100 or more individual computers
1:10:44scattered around the vehicles for all the different functions, because it's been kind
1:10:47of put together piecemeal over the last 30 or 40 years.
1:10:51And so they're transitioning to consolidating that into a few large compute clusters.
1:10:56And running on this for Altify, it's going to be running on Red Hat Linux underneath
1:11:02with this Altify layer that all the applications, all the stuff that used to run on all these
1:11:07discrete ECUs is now going to be running on one computer and instead of those applications
1:11:15directly accessing the sensor data or the actuators, it'll do it by an API call to
1:11:21Altify, which will give the data back and then it'll send a command back for what
1:11:24to do.
1:11:26And this is, I think this is kind of the way that you might see this next generation CarPlay
1:11:32implemented where it has direct access through APIs to vehicle data. It can send through
1:11:41style sheets or themes. And this could also be how you might do things like,
1:11:47one of the things they talked about was operating your climate control using Siri or doing other
1:11:56functions, other vehicle functions through Siri, you would use your wake word and then
1:12:03it would send that request into the Altify layer and execute it that way.
1:12:08Right. It's something like sending your thermostat on the touchscreen, another thing
1:12:13where it could be an overlay that is actually from the car or it could be that if it's
1:12:20something that doesn't really require the real-time component, that it's just a…
1:12:25In the end, it's talking to the car operating system and saying, "What's the current thermostat?"
1:12:30and now, like, "Here's a new setting for you."
1:12:33Which sounds, again, why you need partners, right?
1:12:35Because unless there's a big standard, which there could be, but it sounds to me more like
1:12:40the kind of thing where they shake hands and say, "Okay, we're going to follow your spec,"
1:12:44or "You're going to follow our spec," or "We're going to find a place to do that in common."
1:12:48That Ultify thing is really interesting because that's the idea of GM saying, "All right,
1:12:54We need to have a tech strategy that doesn't integrate a bunch of OEM parts. Like for the
1:12:5921st century, what is our car base? So many of the reasons you know better than everyone
1:13:05as somebody who is focused on the auto industry, the worst user experiences about cars, at
1:13:12least in my – tell me if I'm right or wrong – I find the worst user experience
1:13:16about cars is all because things aren't integrated properly. And you end up with the
1:13:20proverbial dashboard with three on/off buttons on it?
1:13:24Oh, it's only going to get better, Jason. Right now, there are cars you can get that
1:13:30you can simultaneously run three different digital voice assistants.
1:13:34Oh, yeah, yeah. Oh, right. That's right.
1:13:36You know, driving a Ford vehicle right now, you can go out and you can use the built-in
1:13:44voice recognition for a whole bunch of functions.
1:13:47They also now have built in Alexa voice services.
1:13:52So you can say, "Madame A, please raise the temperature,"
1:13:57or "Madame A, please play your favorite band
1:14:01from Amazon Music," or whatever.
1:14:04Or at the same time, I can also just say,
1:14:08"Hey G, do many of the same things."
1:14:12and on GM cars that have Android automotive now,
1:14:16I can jump back and forth
1:14:18and use any of the three wake words to do this.
1:14:21And then if you have an iPhone plugged in instead
1:14:26into an Android automotive vehicle,
1:14:27now you have a fourth with, hey, Schlomo.
1:14:31- Yeah, I mean, I guess the opposite extreme
1:14:34would be something like Tesla,
1:14:36where they've just decided, which on the one hand,
1:14:39Tesla, what I appreciate about that
1:14:41is the whole widget kind of approach that Tesla has taken
1:14:44where it's like, no, no, no, we're doing this.
1:14:46It's gonna be unified.
1:14:46We're thinking about this from the top down
1:14:50and it's gonna be what it is.
1:14:51The downside of that is,
1:14:53yeah, there aren't three voice assistants on the Tesla.
1:14:56I don't think there are any, but they also refuse-
1:14:59- There is some voice rack, but it doesn't work very well.
1:15:01- Right, well, and they refuse to use Android Auto
1:15:06or CarPlay, which I also find infuriating
1:15:09because again, I think it's a user experience problem
1:15:13on the other side, which is like, look, it's my phone.
1:15:15Like having driven a Tesla for a couple of weeks last year,
1:15:19I have my podcasts in Overcast
1:15:21and I would like to play them with that interface.
1:15:24And Tesla's like, no, use Bluetooth.
1:15:28Or I have Apple music.
1:15:29It's like, well, we got a Spotify app here.
1:15:31You could switch to Spotify for your car.
1:15:33No, I'm not gonna do that.
1:15:35So that's a frustration,
1:15:36But at least they have that kind of high level of,
1:15:39we're taking care of everything.
1:15:41Whereas a lot of the cars, it feels very much like,
1:15:43for obvious reasons, it's been built up over years
1:15:46and years and years.
1:15:47And the whole idea of like, I take this part from over here
1:15:50and I take this part from over there, and it's like,
1:15:51oh, now we've got a computer in this part.
1:15:53Well, we've got one in this part too,
1:15:55but they don't really talk to each other.
1:15:57And that gets back to the thing that I get in my mom's car.
1:16:00And I try to turn off the radio
1:16:02when I turn off the air conditioning,
1:16:03because there's two identically sized power buttons
1:16:07right next to each other.
1:16:09But they run completely different systems.
1:16:11- That integration is something that's starting to happen.
1:16:14And approaches like Ultify
1:16:17and some other manufacturers are doing
1:16:19will help with that by bringing it all together
1:16:23on a common computing platform.
1:16:25And I think that's gonna be a key going forward
1:16:28as we move into this era of electric vehicles.
1:16:32in the past, product differentiation used to come through the way a car looked, the
1:16:37way a car handled and rode, the way the engine performed and sounded.
1:16:42And at least from a ride and handling and powertrain perspective, a lot of that falls
1:16:46away with electrification because all electric motors basically feel the same.
1:16:52And so now they want to find different ways to create some differentiation.
1:16:57And part of that is allowing the user to personalize their experience in the vehicle and by giving
1:17:04them options.
1:17:05You know, the reality is that, yeah, you may have three or four assistants available to
1:17:09you in the vehicle going forward, but you're probably going to pick one and go with that
1:17:14one.
1:17:15And that's fine.
1:17:16And it works just fine.
1:17:18Pick the one that you like and that works best for you.
1:17:21And I think that's actually a good solution.
1:17:24that extends to doing things like themes,
1:17:26different graphics schemes and so on.
1:17:30- Well, in the end, I mean, this is a tech analysis of it
1:17:35but I think it works when you talk about user experience
1:17:38in general, which is nobody cares.
1:17:42I know there are people listening to this podcast
1:17:43who do care, but for the most part,
1:17:47nobody cares about how that happened.
1:17:50They just care that it happened.
1:17:51And so like if you step into a car in 2024,
1:17:56and it's got CarPlay on the dash,
1:17:58and it's got the Apple design theme that you chose,
1:18:01and it lights up all the dashboard items,
1:18:04and you're like, "Ah, yes, CarPlay is everywhere."
1:18:07It doesn't really matter
1:18:08what the underlying operating system is,
1:18:11and whether it's that the map that's in that screen
1:18:14that I grabbed from the keynote of like Apple Maps
1:18:17is running right behind the steering wheel,
1:18:19but there's the fact that it's in Drive,
1:18:21and the miles per hour are on it.
1:18:23And like, okay, well, those are actually coming
1:18:26from the real-time operating system
1:18:28and the map is being sent by Apple
1:18:31and being composited by the operating system.
1:18:33And like, nobody cares.
1:18:34If it feels like when I step into my car,
1:18:38oh, it's my car, it's the way I want it
1:18:40and everything is being run based on my settings
1:18:43on my iPhone, like that's, or your Android phone.
1:18:47But like, that's, I think that's in the end what matters.
1:18:50And I think it's better not to feel like
1:18:54I'm running three different things
1:18:56in three different screens, right?
1:18:57Like that's awful.
1:18:58So if Apple's initiative here ends up
1:19:01having this kind of integrated feel, that's great.
1:19:04It's just like, we need to be realistic
1:19:07that there's not gonna be,
1:19:09if you don't have a phone and you step into a car,
1:19:12the valet is gonna park your car
1:19:14and it's just like a gray screen.
1:19:15Like you can't, it can't be that.
1:19:18So it has to be something else.
1:19:20- Yeah, absolutely right.
1:19:21- What, give me some odds of how you think
1:19:26this is gonna go.
1:19:27What's the, is it gonna, is this gonna be a thing
1:19:29that Apple makes a big fanfare about
1:19:31and then it kind of quietly doesn't happen?
1:19:33Or do you think that something more than like a handful
1:19:36of car models is gonna happen with Apple and car makers?
1:19:40- I think something's definitely gonna happen.
1:19:42You know, I've been working in the auto industry
1:19:44for over 30 years as an engineer and a writer
1:19:48and podcaster and an analyst.
1:19:51And this is the most interesting time of my career.
1:19:54It's funny, I was recently doing a project for Motor Trend
1:19:59on software-defined vehicles and talking to some people.
1:20:02And this idea, we've moved from,
1:20:05we've had software in cars since the 1970s.
1:20:07I was working on software in the early '90s
1:20:10for ABS and traction control.
1:20:14We were writing code in Intel assembler for an ADC 196 microcontroller.
1:20:21Boy was that fun.
1:20:22And we've gone from software enabled to software defined.
1:20:26This idea that I talked about with customizing the user experience and being able to do things,
1:20:33having a base set of hardware and adding software to create new experiences or new functionality,
1:20:40I think is really fascinating.
1:20:43it's gonna be an interesting time. And it's gonna be a challenging time for a lot of people
1:20:48too, especially as you've got companies that want to start charging you a monthly subscription
1:20:51for heated seats. We don't need to go down that path right now.
1:20:56Yeah, tech ruins everything, doesn't it? Well, thank you so much for being on Upgrade
1:21:02as a vertical guest in the automotive vertical, a true vertical, not just a sarcastic upgrade
1:21:08vertical but an actual vertical. I should say, so principal analyst for e-mobility research
1:21:13with Guidehouse Insights, the Wheel Bearings podcast, wheelbearings.media, if you want
1:21:18to check that out. Are those the best places for people to find you?
1:21:21Yeah, and you know, just Google my name, you know, I'm on Twitter. I don't do Facebook.
1:21:26I quit Facebook multiple years ago. But yeah, that's probably the best places to find me.
1:21:32All right. Thank you so much for being here.
1:21:34I'm happy to be here. Thanks, Jason.
1:21:37This episode is brought to you by Capital One. Have you ever hit a technical snafu while
1:21:42you're shopping online, if you're ever given a headache by having to fill out payment
1:21:46fields has your mobile banking app ever been down when you needed to use it the most?
1:21:51Capital One believes everyone deserves better banking. This means easier access to your
1:21:56money and more security at the same time. That's why Capital One is investing in machine
1:22:01learning.
1:22:02Machine learning allows Capital One to do things like fight fraud with random forests.
1:22:06They have models that quickly detect suspicious activity to make it faster to alert federal
1:22:11investigators and identify how mobile app outages happen with causal models. This keeps
1:22:17their mobile app up and running. They use this hard work to make it work for them. They
1:22:23use anomaly detection and incident response to help determine why app outages are happening
1:22:28so engineers can quickly remedy them.
1:22:31Capital One speed up online shopping with machine learning at the edge. This makes shopping
1:22:35with virtual card numbers smoother and more secure. This technology is based on logistic
1:22:40regression models and running inference in the browser, this will identify payment fields
1:22:44to help make it even easier to use virtual card numbers and faster at the same time.
1:22:49The potential of machine learning is so big, see how Capital One is using machine learning
1:22:54to create the future of banking. Search "machine learning at Capital One". Capital One, what's
1:22:59in your wallet? Our thanks to Capital One for their support of this show and Relay FM.
1:23:05It is time for #AskUpgrade.
1:23:07I have a bunch of questions from Upgradients.
1:23:14The first, John who asks, "With the added functionality for the lock screen in iOS 16,
1:23:21do you expect that you'll be changing your background photo more often?"
1:23:26I did change mine.
1:23:27I have used the same image for like two years and it didn't look as good as I wanted and
1:23:34And so I ended up changing to a really good photo I have of my wife, Adina, and I like
1:23:38it way more.
1:23:39It just fits way more with the overall aesthetics of what Apple's going for, I think.
1:23:44I think that that's really people and buildings, I think, ideally what you want to be doing
1:23:54and what I think Apple would like to promote you to do.
1:23:57I think I'm going to change the picture on my lock screen more often.
1:24:03I wish, and I know that this has changed in the betas,
1:24:06but I don't consider the wallpaper behind my home screen
1:24:10the same as my lock screen.
1:24:11I think they're very different
1:24:13and they have different purposes.
1:24:14And I want like things to appear on the lock screen,
1:24:16whereas I want the home screen to be pretty neutral.
1:24:19And one of the things that really bothers me
1:24:21about the beta implementation of this feature
1:24:23is that it constantly wants you to override your wallpaper
1:24:27when you change your lock screen.
1:24:29And I just wanna be able to say no thanks
1:24:31because I kinda like my wallpaper
1:24:34and I don't need it to be changed.
1:24:35- It's easier to do that now,
1:24:37but still it makes you do it and I wish that it did.
1:24:40- I hate it.
1:24:41- Yeah, I don't need to go through that
1:24:43every time I change anything.
1:24:45- I edit a widget and it says,
1:24:48"Great, would you like to change your wallpaper?"
1:24:50I was like, "No, I, no."
1:24:51- If I'm changing my wallpaper, fine, you can ask me,
1:24:54but if I'm editing a widget, leave me alone.
1:24:57I don't need to change my background anymore.
1:24:59- Make it stop.
1:25:01So that's where I draw it all in.
1:25:02But yes, I think on the having multiple lock screens
1:25:05with different images on them, I think is a lot of fun too.
1:25:08And so like Apple Watch Faces,
1:25:11you have the ability to switch between them
1:25:12and that fundamentally will mean
1:25:14that the background pictures change more.
1:25:16- And then Jay Young asks,
1:25:21what widgets or complications are you currently using
1:25:24on your iOS 16 lock screens?
1:25:27- Oh, I have a scriptable widget
1:25:32that shows my current temperature and conditions
1:25:34at my house.
1:25:35- I wanna talk, we're gonna talk about this
1:25:36in more detail at some point in the next few weeks.
1:25:38I wanna get into what you've been up to.
1:25:40- It's early, but yeah, I do have that, which is great.
1:25:43So that's the one right now.
1:25:44I imagine I'll do more.
1:25:46I haven't gotten back to that,
1:25:47but that was the first one where I had a little,
1:25:50there's a scriptable beta where I can actually do widgets
1:25:52that are on the lock screen and that is fun.
1:25:55'cause I've been using them for the home screen
1:25:58for a while now, but the lock screen is now supported
1:26:01in the beta of Scriptable,
1:26:03and I'm just getting started with that.
1:26:06But having the live like temperature,
1:26:08the same temperature that's in my menu bar of my Mac
1:26:10is now on the lock screen of my iPhone, and that's awesome.
1:26:14- So I'm using a bunch, obviously, you know me.
1:26:18The one that goes on top of the time,
1:26:21I think it's called Inline.
1:26:23just text. I'm using Apple's calendar right now. I like it because it tells me to date
1:26:27and my next appointment. Eventually I hope to change this to Fantastic Al. I hope that
1:26:34they will also have this same configuration. I like it. I then have weather. I will eventually
1:26:41change this to Carrot Weather. And that's in the one that's got a bunch of text. It's
1:26:44like the long rectangle one. It's giving me the current conditions. And I expect that
1:26:51But Cara Weather will let me choose everything that goes there, the same as they do with
1:26:55widgets.
1:26:56Then I'm using a Timery, current time tracker one.
1:27:01And then a pedometer app thing.
1:27:06I'm not saying where, because that's all in beta.
1:27:12The Timery one's in beta, but they've spoken about it publicly.
1:27:15But I also have my steps being counted as well, which I like.
1:27:18That's what I have right now.
1:27:20I don't know what it will look like when I actually get more of these from the apps that
1:27:24I use.
1:27:25I only have two apps right now that I'm on the beta for that have this included in them.
1:27:31One is Tymerean and the other is the one that showed me my steps.
1:27:36That's what I have right now.
1:27:37And I don't know how much more I'll change except for where I've said like I'll swap
1:27:42things out for the actual apps that I use.
1:27:45That's what I'm waiting for is I'm waiting for the other apps that I used so that I can
1:27:48and browse through those and see if there are ones there
1:27:50that I wanna integrate too.
1:27:51But I'm also okay, at this point, I'm also okay
1:27:54with the fact that I can build my own if I need to,
1:27:56which is kind of fun.
1:27:57- But that kind of, the kind of information
1:28:00I have there right now is the kind of information
1:28:03that I would want on my lock screen.
1:28:06That's the kind of stuff.
1:28:07- A calendar thing for sure.
1:28:08I'm just, I don't wanna use Apple's calendar stuff.
1:28:10So I'm waiting for fantastic help in the fall.
1:28:14And I will definitely add that somewhere.
1:28:17A question of where, right?
1:28:18'Cause that up by the date is really powerful
1:28:21and yet it's also really limited
1:28:23'cause it's just that little inline text snippet.
1:28:25- I think that for me, that's perfect.
1:28:27If, because I like that I can also get
1:28:30that added piece of information on the lock screen,
1:28:32which is the date.
1:28:34I like that.
1:28:35- Sure.
1:28:36- I like that being there.
1:28:37Eric asks, "I needed to get an M1 iMac for a family member
1:28:42and they are way back ordered or unavailable.
1:28:45Do you think this is supply chain related
1:28:47or do you think there's a pending update?
1:28:50- I think it's supply chain related.
1:28:51Mark Gurman is to be believed.
1:28:54They're not even worried about an M2 iMac right now.
1:28:57And maybe I hope there is an M2 iMac,
1:29:00but I feel like this is supply chain related
1:29:02and factory shutdowns.
1:29:03And they were probably prioritizing the laptops
1:29:05and that's why.
1:29:07- Yeah, I think like going back
1:29:08to what we were talking about earlier,
1:29:10clearly the Mac is most impacted right now.
1:29:12And as you said, they're probably,
1:29:15if it's legacy node related,
1:29:16they're probably cannibalizing some chips
1:29:18to go in other places, you know, like.
1:29:21- I think, yeah, I think selling a lot of MacBook Airs
1:29:24that are very, very popular
1:29:25is gonna take more money off the table
1:29:28than having a bunch of iMacs in inventory, right?
1:29:31So I think that's it.
1:29:32I mean, Apple loves all its computers equally,
1:29:35but you know, if you have to choose
1:29:38getting that new MacBook Air out there
1:29:40or prioritizing the iMac, I know which one I would choose.
1:29:44And Ramon asks, what do you think about replacing
1:29:48the potential of Apple replacing the 13 inch MacBook Pro
1:29:52with a 12 inch MacBook Pro that has a new design?
1:29:55Perhaps there's some options to put faster chips in
1:29:59or maybe a better screen, that kind of thing.
1:30:01- Don't think Apple is gonna do a 12 inch Pro.
1:30:0612 inch Air, yes.
1:30:1012 inch Pro, I don't think so.
1:30:12I think smaller, packing more heat into a smaller area,
1:30:15it's just not a thing that they're gonna wanna do.
1:30:17So I think, I just don't think that's likely.
1:30:21I think that the 14 is the new 13
1:30:24and the 13 is a weird outlier computer
1:30:26that will go away at some point.
1:30:28And then the MacBook Pro will be the 14 and the 16.
1:30:30- Yeah, I'm thinking we're more likely to see
1:30:34the removal of that product completely
1:30:38and replaced with more MacBook Air options
1:30:41and bringing the prices down over all over time
1:30:46and then that just reshuffles and that thing disappears.
1:30:49I think that's it.
1:30:51If you would like to send in a question of your own
1:30:54for us to answer on the show, just send out a tweet with the hashtag #AskUpgrade
1:30:58or use question mark #AskUpgrade in the Real FM members discord.
1:31:02I would like to thank Capital One, Bombas and Sourcegraph for the support of this episode
1:31:06and of course thank you for listening and a special thanks to our members
1:31:11who subscribe to Upgrade Plus. If you want to find Jason online in the
1:31:15meantime until next week's episode you can find him at sixcolors.com
1:31:19the incomparable.com and Jason hosts many more shows here at Relay FM just
1:31:24like I do you go to relay.fm/shows and find
1:31:27a new podcast put in your queue. I am @imike and we'll be back
1:31:33next week. Until then Jason Snow. Say goodbye.
1:31:38Goodbye everybody.
1:31:39[music]
1:31:45[ Silence ]