166: The Machine That Makes Money


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00:00:08   >> From Relay FM, this is Upgrade, episode 166.

00:00:12   Today's show is brought to you very kindly by folk over at Eero, Casper, and

00:00:17   Encapsula.

00:00:18   My name is Myke Hurley, and I am joined by Mr. Jason Snell.

00:00:21   Hello, Jason Snell.

00:00:22   >> Hello, Mr. Myke Hurley.

00:00:23   How are you doing?

00:00:25   >> I'm doing very well, Mr. Jason Snell.

00:00:26   I understand that you are much better rested this week than you were last week.

00:00:29   Yeah, I got a little more sleep because I was having a little sleep deficit and it's

00:00:35   turned really to the fall here in Northern California.

00:00:38   Hey, but Jason Snell, Jason Snell, nobody cares about that.

00:00:41   The leaves are turning.

00:00:42   Jason, no one cares about it.

00:00:44   It's time for #SnellTalk and this week's Snell Talk question comes from Pete and Pete

00:00:48   wants to know, "Regarding the Series 3 watch dot, did you ever believe, Jason, that you

00:00:54   would beat Myke to putting a sticker on a new Apple product?"

00:00:59   Uh, why you have to lash out, Pete?

00:01:01   Why you have to do, why, why, why are you going to put that hate on me, Pete?

00:01:05   So, uh, I, I have a couple of statements here.

00:01:09   One is, I do have a, first off, it's not a sticker.

00:01:13   It's a decal.

00:01:14   It's totally different.

00:01:15   It's decal.

00:01:16   That's not, no, that's the vinyl decal.

00:01:18   So, so, so many of mine, Jason.

00:01:21   All right.

00:01:21   Well, those, those are better than, than your paper stickers.

00:01:24   And second, I actually have decals

00:01:29   on most of the Apple products that I use.

00:01:32   My iMac has a rainbow Apple logo decal on it.

00:01:34   My MacBook Air has a rainbow Apple logo decal on it.

00:01:37   Always be branding, always on brand.

00:01:40   So it's not quite as surprising as you'd think.

00:01:42   And the funniest part is that I didn't get a watch dot

00:01:46   that was black to make my space gray phone

00:01:49   or space gray watch less recognizable.

00:01:52   Instead, I got one that was orange.

00:01:54   So it could be just a little bit off from the red

00:01:56   and go with my orange sport band

00:01:58   that I wear most of the time.

00:02:00   So I have thought about it.

00:02:02   Yeah, it looks, I mean, it's subtle, right?

00:02:03   In the sense that you could be like,

00:02:05   "Oh, that's that red dot."

00:02:06   Well, it's not quite a red dot, it's orange.

00:02:10   I have thought about buying black watch shots though

00:02:12   and just putting it on and being like, "Forget about this."

00:02:13   So maybe I'll get there.

00:02:15   But yeah, Pete, you know, I contain multitudes.

00:02:18   I sometimes put stickers on things.

00:02:20   I got stickers on the back of my iMac.

00:02:21   I got stickers on my iPod Hi-Fi.

00:02:22   That's covered with stickers

00:02:23   'cause who cares?

00:02:25   It's an iPod Hi-Fi.

00:02:27   So yeah, anyway.

00:02:28   Also somebody pointed out,

00:02:29   here's a little Snell Talk follow-up.

00:02:31   Somebody pointed out that iOS 11, I think,

00:02:35   officially does away with the last vestiges

00:02:37   of iPod Hi-Fi support.

00:02:39   That it used to be certain devices

00:02:42   could still attach to the iPod Hi-Fi via adapters

00:02:46   and see it and have the setting for like the EQ and stuff.

00:02:49   And that's not in iOS 11.

00:02:51   They took that out.

00:02:52   It's about time.

00:02:53   I can't believe it lasted.

00:02:54   I'm mind boggling that it's lasted.

00:02:57   - Honestly, if you're going to use the iPod Hi-Fi

00:02:59   with an Apple product attached via the dock connector,

00:03:02   it needs to be a vintage Apple product.

00:03:04   - Yeah, you've got like a little iPod Nano

00:03:06   just like constantly fixed to the thing

00:03:08   and then that's just how it powers the music.

00:03:10   Like that's the only way that should work really.

00:03:13   - Or you do what I do, which is the aux input.

00:03:15   And I actually wish, here's a thing

00:03:17   that somebody with a 3D printer could make for me

00:03:19   if you're feeling really, there's a huge market for this,

00:03:22   which is, you know, the iPod Hi-Fi has that dock insert.

00:03:25   So it came with a like oval thing around the dock connector

00:03:30   that was a fairly deep depression.

00:03:33   And then it came with a set of plastic connectors.

00:03:35   And for a while, when you bought like an iPod,

00:03:37   it would come with a dock connector

00:03:39   and they were creating like a universal system

00:03:41   where they could custom shape the bottom of your iPod

00:03:44   to the dock connector.

00:03:45   So what I'm saying is somebody could make one of those

00:03:49   that is designed to go around the dock connector,

00:03:51   but totally cover it and make the top

00:03:53   of the iPod Hi-Fi smooth.

00:03:56   - You could at least sell one of them to you

00:03:57   and one of them to Steven and that's the whole market.

00:04:00   - Yeah, yeah, it's basically put mothball,

00:04:03   the dock connector of your iPod Hi-Fi

00:04:05   'cause that's where I have my little relay FM wood block

00:04:07   that you guys gave the hosts last year or two years ago.

00:04:11   That's where it is,

00:04:12   it's covering the unsightly dock connector.

00:04:15   So they're product idea, they'll sell a couple of them.

00:04:18   two, maybe even only one, who knows. If you would like to send in a question to open the

00:04:23   show just tweet with the hashtag SnellTalk and I'll be able to pull them into a document

00:04:27   and bring one out for a future episode. Thank you to Pete for sending in his question. So

00:04:32   let's go talk about some follow up. I saw a couple of people tweeting about this and

00:04:36   noticed it myself but we didn't talk about it last week because there were so many more

00:04:39   other things going on. The lovely leather sleeve that appeared for the iPad Pro last

00:04:46   year or earlier this year I should say now exists for the MacBook too. There is now a

00:04:51   12 inch MacBook leather sleeve available. I saw them in the Apple store when I was there

00:04:56   on Friday. So if you want to carry around your MacBook in a lovely little leather pouch

00:05:03   in either Saddle Brown or Midnight Blue, go wild. It's only $149.

00:05:09   So I have the, because it was part of the Apple review unit kit, I have that leather

00:05:17   sleeve for the iPad Pro.

00:05:20   And I always think about using it, like oh this is really nice, maybe I'll use this when

00:05:24   I travel, and then I think, nah.

00:05:30   So I think it really is somebody, if you've got like really nice like a business, like

00:05:34   a briefcase, and then you've got this inside it and you want it to be all very nice and

00:05:38   leather and high quality and stylish and all that then great but in most of my cases I've

00:05:42   like I've got bags with places you put a laptop or a tablet and that's enough.

00:05:49   I really love to look at that thing though. Like I really do.

00:05:52   It looks great. My issues aren't with the look or the quality of it. It is an amazing

00:05:56   piece of leather work. I think I mentioned on the show before that I was talking to Matthew

00:06:00   Panzareno from TechCrunch about it because he's a shoe guy. He loves shoes and he was

00:06:06   talking about how he's noticed and that other people who know about like leather

00:06:10   and stuff have noticed how Apple's leather game is so much better than it

00:06:14   was when they did the first watch bands and that they've like they've really the

00:06:18   leather products that they make for these accessories are so good and here I

00:06:24   mean it's a beautiful all these sleeves are beautiful and there's a reason they

00:06:28   cost what they cost they are a very high quality very attractive I don't the

00:06:34   utility does not follow for me. Like it's just not the kind of thing I would use.

00:06:39   But if you're somebody it appeals to, they are beautiful and well made.

00:06:45   Last week on the show we were discussing the notch on the iPhone X and wondering

00:06:51   if any app developers could actually make use of the space, right? You know, we

00:06:55   were talking about the fact that most of the apps that you'd seen, Jason, it was

00:06:58   mostly just people were extending the color bar or whatever right to the top.

00:07:02   like for a fantastic L is a good example. They just fill the notch like the the ears

00:07:06   on the side of the phone. They just read right like the status bar just extends. There is

00:07:11   a an application called I'm going to say it's Halide. I don't know how you pronounce this.

00:07:15   Halide. Halide. Thank you so much. H A L I D E. It's

00:07:19   a camera application. I'm assuming that Halide is some kind of camera thing.

00:07:23   It's a film reference. Yeah. There you go. Thank you. I don't understand professional

00:07:27   camera apps. So I downloaded this app and I didn't know what I was doing, but it looks

00:07:32   very powerful. But what this application is doing, it's putting some, I think it's like

00:07:38   focus information and graphs and stuff up into the notches so you get more screen space

00:07:46   for the image itself. They're not covering up the image with any information. Instead,

00:07:51   they're putting it right up the top and making use of the full screen. I was really excited

00:07:56   to see this because it shows that people can use this in interesting ways and it enthused

00:08:05   me to think of how are developers going to embrace the notch as a design element and

00:08:12   I think that this is not just a flashy looking thing, there's actually some real utility

00:08:17   in the way that they've made this app and used the full screen to their disposal.

00:08:23   - Not every app is going to need to do that.

00:08:26   And I think I've enjoyed some of the apps

00:08:28   that are more just sort of extending their user interface

00:08:31   or perhaps they're, I think it's carrot weather,

00:08:34   like they're little clouds and other things

00:08:36   that kind of extend up there.

00:08:37   It's not just the background.

00:08:38   You can draw things up there

00:08:40   and sort of you extend your background texture or pattern.

00:08:43   And it looks nice, but there are some examples where,

00:08:46   yeah, you can just take that area over

00:08:48   and you put indicators in it.

00:08:50   And that's great, looks great.

00:08:52   And also some follow up from a few weeks ago. We were talking a bunch about Apple's potential

00:08:59   streaming service and what their content might look like. Well, there was a report from Recode

00:09:04   and Bloomberg a couple of weeks ago from Peter Kafka and Lukas Schur, respectively, that

00:09:10   Apple are apparently, when they're talking to Hollywood executives or they're talking

00:09:16   like about people wanting to pitch content to them, that they want family friendly content

00:09:22   for their streaming service. They do not want to feature sex or violence in their programming.

00:09:27   And me and you were talking about this and I think we both came to the belief that we

00:09:32   both kind of agreed to the point that we believe that they would have this right like they

00:09:36   would go in the HBO direction. But it looks like they have said they want to be family

00:09:42   friendly. Apple want comedies and emotional dramas with a more broad appeal. That and

00:09:47   there's a good I think this is hilarious quote they don't want kids to see a

00:09:51   stray nipple is a is a quote that came from from somebody in Hollywood so this

00:09:56   may be true although I I still have a hard time believing that this is

00:09:59   absolutely the long-term story if you read the recode story I think it is

00:10:04   closely what you'll see is a description of how they anticipate apples roll out

00:10:10   of this service to be yeah which is they anticipate that the first shows that

00:10:16   that are stoking interest in Apple's originals are going to be either given away to everyone

00:10:22   who owns an Apple device, or they're going to be, you know, maybe they'll be part of

00:10:27   Apple Music, but the suggestion in the Recode story is that everybody who gets an Apple

00:10:30   device is going to be given these shows. And there's a question of, will that mean they

00:10:34   launch the service and if you've got an Apple device you get the first six months free or

00:10:38   something like that, the first three months free, where they would drop these first shows.

00:10:41   The point in the Recode story is that they anticipate that the initial shows are going

00:10:47   to be available to everyone, and with no filter and no sort of self, you know, trying to--I

00:10:57   guess the way I would put it is it's a little more like turning on broadcast TV, in the

00:11:01   sense that everybody gets it. You don't choose to sign up for it, or choose to tune in for

00:11:06   And what they want is to make those shows have broad appeal and not lead to stories about "I was offended by this thing that Apple did"

00:11:14   even though we are full of adult content shows these days.

00:11:18   So I think I'm gonna choose to read it, and maybe this is WishCasting, but I'm gonna choose to read that as

00:11:24   Apple's launch plan is for broad, because they know those first shows are gonna get sampled broadly,

00:11:30   and then when they're building their subscription service they will start to add shows that have more limited appeal

00:11:36   like, adult appeal because they want, you know, they want to have a spread of it. But

00:11:41   Tim Goodman and I talked about this on TV Talk Machine last week, and, you know, his—he's

00:11:47   about as incredulous as I am that, like, if Apple—I mean, he went so far as to say,

00:11:51   like, if Apple's goal here is to just make network TV on streaming, it will fail. Like,

00:11:56   I get the Apple's—so this is the mystery, is does Tim Cook come in and say, "Nope,

00:12:03   family programming, we don't want any of those things, which is like, Jeff Bezos was like,

00:12:07   I want the next Game of Thrones. Okay, well, you know what's in Game of Thrones, right?

00:12:12   Sex and violence and language. That's what's in, in nudity in Game of Thrones. All those

00:12:16   things are in there.

00:12:17   - Amazon don't want, already have content like that though anyway.

00:12:19   - Yeah, oh yeah, oh yeah. They don't care. But this is, this is what I'm saying is, is

00:12:24   you can't, somebody could argue this point, but I would disagree with them. I don't think

00:12:29   you can go to creators who are going to create the very best content that's going to win

00:12:34   you Emmy awards and have everybody talking about your content and say, "You can do whatever

00:12:39   you want as long as it's something that would air on NBC." I don't think that's going to

00:12:44   work for them, because I think the creators want the freedom to do things that they feel

00:12:49   are more realistic, and yes, titillating, but also realistic portrayals of people saying

00:12:53   bad words and having sex and being naked because people do those things, just not on network

00:12:58   So I'm choosing for now to parse the recode statement that this is all about launch and promoting this service and trying to cast as wide a net as possible.

00:13:10   But it will be interesting if Apple comes out with these shows and the take on them is that they're all kind of vanilla and boring.

00:13:18   boring and I think it will limit Apple's ability to sign top tier creators if they say, "again,

00:13:28   we will give you lots of money but your constraint is going to be that you have to be at a network

00:13:32   TV level of standards and practices."

00:13:35   I basically agree with everything you said. I think that this is their starting point,

00:13:40   this is their free, this is the first taste type stuff so they want to get everybody but

00:13:44   They know they're not stupid right and they've brought in people that also know right that know better than anybody right like they've hired

00:13:50   Great people and you'd expect that you know, we did those guys that they got from Sony

00:13:56   If they thought that they were just gonna be making like full a house

00:14:01   They probably wouldn't have come on board right like I would expect they know the long-term plan

00:14:06   And that that it you know

00:14:10   that it will then inform for them later to make some more edgy niche content.

00:14:15   This report also did say that apparently Tim Cook got involved with an edit of

00:14:19   Carpool Karaoke. There was an episode that he delayed because there was some

00:14:23   language and content that he was unhappy with and didn't think it was appropriate.

00:14:27   Yeah, well I'll tell you if the message that the TV executives go out to to the

00:14:33   creatives in Hollywood is that Tim Cook is gonna watch your show and

00:14:41   personally demand edits because of adult content. They're not gonna

00:14:47   sign anybody to deals who's any good. It's not gonna happen. So

00:14:50   this is actually a harmful story for Apple. These

00:14:58   stories hurt Apple's attempts to get into this, I would imagine that privately these

00:15:04   executives are spinning this and saying, "No, no, no, it's just for the launch and no, no,

00:15:08   no, that was Carpool Karaoke is totally different and that's part of Apple Music and it's a

00:15:11   different service and blah, blah, blah."

00:15:12   Yeah, like, "We weren't here then, right? Like, we weren't--that's not how it's gonna

00:15:16   be."

00:15:17   It's gonna chill their conversations with creators. And again, I can hear somebody out

00:15:22   there saying, "Come on, you can make a good show without nudity and violence and sex talk."

00:15:26   like, "Well, you can, you can, but a lot of the greatest stuff pushes boundaries."

00:15:37   And the people who are the most bona fide star creators of content in Hollywood want

00:15:44   to push boundaries and make the most creative stuff that will win them accolades and awards.

00:15:50   And sand it off family-friendly content while it has a place and there's nothing wrong with

00:15:56   it, and I, you know, I watch, well, not a lot of it, but I watch some of that stuff.

00:16:02   I mean, I watch network TV stuff, and it's fine, but that's not the stuff that the top

00:16:09   notch of the industry are creating, and I don't think Apple wants to go out with a product

00:16:13   that is basically like, "Pay us $10 a month for more network shows." Like, I'm not sure

00:16:20   how that sells. So that's their challenge is how do they--this comes back to the thing

00:16:26   that you and I have talked about before, is how is this going to roll out? What are they

00:16:30   going to do? And maybe now we have a little hint about that, which is they're going to

00:16:34   have a first wave of shows that they want to have kind of broad appeal that'll get people

00:16:38   to start to appreciate Apple's video efforts, and they'll do that as part of the launch,

00:16:45   try to launch as broadly as possible, maybe following the Apple Music model, maybe they

00:16:49   to give everybody six months of access to it.

00:16:51   And then as that door is closing,

00:16:54   they also ramp up with new original material

00:16:57   that is maybe racier on one end

00:17:01   and also maybe like more targeted on other ends.

00:17:03   I mean, maybe more children's content, right?

00:17:05   I mean, HBO, like we said last week,

00:17:07   HBO has sex and violence and nudity.

00:17:10   HBO also does Sesame Street.

00:17:12   Like there is a broad range on HBO

00:17:16   and Apple could do that too.

00:17:17   [laughter]

00:17:18   It says "from big birds to big dragons." That's HBO. That's what they're all about.

00:17:24   Yeah, I really was sad about that scene where--well, it's a spoiler, I'm not gonna say about what

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00:20:33   So, Jason, you've had the iPhone X for a week now. I want to know how and if your feelings

00:20:43   have changed or evolved. Is there anything that's sticking out to you more than it did

00:20:47   a week ago? Is there any opinions changed or reinforced with your time with the phone?

00:20:56   So Face ID, the only failures that I've really had have involved me having something in front

00:21:00   of my face like the microphone right here.

00:21:04   Like that's something that I have to change if I want to flip open my phone while I'm

00:21:07   on a podcast I actually need to move away from the microphone just enough for it to

00:21:11   see my face.

00:21:12   You gotta get the Tae's On Day move down, you know, you gotta move away from the microphone

00:21:16   when you unlock.

00:21:17   That's right, it's just a thing you've gotta do.

00:21:20   I really love it, I love the screen, I love that it is edge to edge, you know, less the

00:21:27   notch.

00:21:28   The notch doesn't bother me at all, I don't really notice it.

00:21:30   just part of the personality of the phone. I like the data up in the corners. I always

00:21:34   felt like the status bar was too crammed full of junk too often. I like the fact that it

00:21:40   doesn't color the whole status bar now when you're in a particular mode like recording.

00:21:45   It just kind of puts a background under the time.

00:21:50   So like tethering and calling and screen recording. It used to do the whole big dropdown, but

00:21:55   now it just puts a little colored circle behind the time, right? So like it's a blue one for

00:22:00   tethering and green for a call and red for screen recording.

00:22:03   Yeah, exactly. So it's that sort of thing.

00:22:09   It's all... I'm just really liking it.

00:22:14   I have found myself in instances where before I would have gone and

00:22:19   gotten my iPad where I'm like, "Yeah, I want to play with the iPhone a little bit

00:22:22   more." And it's been fun to use it.

00:22:26   And yeah, I don't think it's evolved very much

00:22:31   in that my initial response was really positive

00:22:33   and that I adapted to it very quickly.

00:22:35   And that continues to be the case.

00:22:36   It's nice to see new app updates come out.

00:22:39   There are still a few apps that have been,

00:22:42   you know, revved over the last week to fix issues

00:22:46   with iPhone 10 compatibility,

00:22:48   especially like midweek last week,

00:22:50   all of the, we need to get this out by Friday,

00:22:54   updates started to hit.

00:22:55   So like I was using the previous version of the Slack app

00:22:58   and it was just, you know, it was bars top and bottom.

00:23:02   And so letterboxed.

00:23:04   And then they pushed an update on Wednesday or something.

00:23:07   It was like, oh, now it fits.

00:23:09   And it's just, it's nice when that happens

00:23:10   to get the full screen use of the 10.

00:23:15   But no, I'm basically, I'm loving it.

00:23:18   I did get my one that I bought

00:23:20   'cause I have the Apple review unit, which is a silver,

00:23:23   but I got the space gray one that I bought.

00:23:24   So I was able to kind of like compare the look of the two models, which is interesting.

00:23:31   I think the, the space gray looks good, but not as good as I hoped.

00:23:36   And the silver looks way better than I thought it would.

00:23:38   I think I would probably choose the space gray anyway, if I had to choose.

00:23:43   Um, one of them today to buy, but, um, it's much closer than I thought because

00:23:50   that that especially that shiny polished stainless steel on the silver one is beautiful and the

00:23:56   fact that it's got the black front the black bezels because I never liked the white bezels

00:24:01   and I'm glad that they're dead. So I got a phone on Friday I was able to get it. Oh the

00:24:07   drama the drama you managed. I was running all over town but I was able to get I have

00:24:12   a I have a silver one which was what I wanted I wanted the silver. It is called silver I

00:24:18   I keep calling it white, people keep correcting me, it is silver. And I will say that the

00:24:22   back of it is more silvery than the white has been on the front in the past. It's not

00:24:30   like bright white, it is more silvery.

00:24:32   I mean, I had a PR person refer to it as iridescent, I sort of called it kind of sparkly, but it

00:24:40   definitely is a different than even the eight white background, silver background. And they

00:24:46   They said that although most of the layers of coating on the glass are the same as on

00:24:50   the iPhone 8, there is an extra layer on the 10 on the back, and that's that iridescence

00:24:55   layer that makes it just a little sparkly.

00:24:59   I love this phone, Jason.

00:25:01   I knew you would.

00:25:03   Plus Club, though, you're leaving the plus behind, so I'm interested in getting to that,

00:25:08   too, as a change.

00:25:10   But go ahead.

00:25:11   Go ahead.

00:25:12   So I have lots of points.

00:25:13   I have a whole list of points here comparing it to the Plus,

00:25:17   but I need to set up a couple of things first.

00:25:20   So the overall design of this phone,

00:25:23   I think it's my favorite iPhone design of all time.

00:25:26   It has this like luxury, futuristic feeling to it

00:25:31   that maybe hasn't been this way since the first one.

00:25:37   Like whenever I use this phone and I look at it

00:25:41   and I pick it up and like I feel it

00:25:42   and I see the silver and the screen and it lights up

00:25:45   and the beautiful screen is right there in front of me,

00:25:49   it honestly does feel like the future.

00:25:52   And I know that it's the marketing line

00:25:54   that Apple have used, but it is such a huge jump

00:25:57   from the previous iPhone.

00:25:59   There are so many little things about it

00:26:01   that feel like huge, just huge advances.

00:26:04   It feels like the future for iPhone users.

00:26:07   And I know that some of this stuff,

00:26:09   and I bet this is the same

00:26:10   when you upgraded your Galaxy to the ones with the edge-to-edge screens, right?

00:26:15   Like there is just something about this. I think it's more than a fad.

00:26:18   These designs with the larger screens really advanced these phones in

00:26:22   interesting ways and I just, you know, I've had it for like four days now and

00:26:28   every time I look at this thing I am surprised again at how much I love the

00:26:33   way it looks. I don't want to put this phone in a case. I've bought AppleCare+.

00:26:38   I have ordered the in case frame and it's on the way which is one of the

00:26:43   bumpers I was talking about last week I want to see what that's like I have an

00:26:46   Apple silicone case which I've put in when I've left the house a couple of

00:26:50   times because even though I have Apple Care+ I feel like right now is the worst

00:26:54   possible time to try and get an iPhone replaced so you know I'm trying to be

00:26:59   careful with it for the time being but this phone screams to be caseless

00:27:04   because it feels so great in the hand, the glass feels amazing and the stainless steel frame is just so beautiful

00:27:11   I don't want to cover it. Doesn't it look good? Yeah, it really looks good.

00:27:15   But the only thing is without cases the camera bump is bonkers on this one. It's huge

00:27:20   Like if you touch that foam that's on the table almost does a 180 flip like it's it's mad

00:27:26   It is, you know

00:27:27   I mean, I know the camera's big and they I think they made the bump a bit more of a design thing

00:27:31   which when I look at it, I actually like the design of it, but using a phone on the table

00:27:36   is tricky. But to be honest, I'm using it less on the table anyway because it's not

00:27:42   as easy to unlock so I kind of pick it up anyway. So I'm actually doing it less because

00:27:48   you can unlock it when it's on a table but you have to kind of like look right over to

00:27:52   it so I just find myself not doing that so much.

00:27:55   Now usually the main event of our episodes where we get new iPhones is talking about

00:28:01   the horrors of setup.

00:28:02   Yeah.

00:28:04   This one went great.

00:28:06   And I even made it tougher than

00:28:08   before. I was being tough on this

00:28:10   phone, Jason.

00:28:11   I decided to do a full iCloud

00:28:13   restore, which is not how I usually

00:28:14   restore.

00:28:15   I usually restore via an iTunes

00:28:17   backup, right?

00:28:18   Because you're not pulling so much

00:28:20   down from the cloud.

00:28:21   But I thought to myself, this is how

00:28:24   people actually do

00:28:26   set up their new phones.

00:28:27   They set them up with iCloud

00:28:28   restores, right?

00:28:29   So I thought to myself, I don't

00:28:31   don't want to go easy on them. I want to make it as hard as it can possibly be because this

00:28:36   is how everybody does it. I'm setting up a new iPhone on iPhone release day via iCloud

00:28:43   and it was a little slow in some places but overall worked great. There were no huge hang

00:28:47   ups, no apps that I couldn't download, I wasn't waiting all afternoon for apps. I know that

00:28:53   in the US there were some problems with AT&T activation but I had no problems here in the

00:28:58   UK. I was really surprised at how well it worked.

00:29:01   iOS 11 has made this so much better. I applaud Apple for listening to their customers about

00:29:10   how tough it has been to do this process because two huge things for iOS 11. One, where you

00:29:17   hold one phone next to the other phone and it shares a bunch of settings. Right? That

00:29:23   was fantastic. So I didn't have to sign into a bunch of stuff. I didn't have to set up

00:29:27   new Wi-Fi like that was all just shared and they have condensed the amount of screens

00:29:32   in iOS 11 for setting up the phone. So, you know, there was like, "Hey, what about the

00:29:37   suggested settings?" And it just did it all for me, right? And it's not nice and it changed

00:29:41   it. This was brilliant.

00:29:42   We very specifically complained about that. And it was so good to see that that was a

00:29:48   thing where they address their attention of like, "Do we need to ask them permission for

00:29:51   all of these things?" And so it's like, "Look, we could just go with the permissions you

00:29:55   already granted instead of asking you again. It's like, yes, please do that and it saves

00:29:58   a lot of time and friction.

00:30:01   The only thing that was weird for me was that I had to install iOS 11.1 during the setup

00:30:07   process. I've never done that before to my memory. Like that the phones didn't ship with

00:30:12   the most recent version. I don't know what happened there. Maybe 11.1 was a little bit

00:30:16   later than they expected or something.

00:30:17   Yeah, I think some phones must have been manufactured before 11.1 was ready and so they shipped

00:30:23   with an earlier version and then just do an auto update or something like that.

00:30:26   That must have been a production line thing in order to keep the phones flowing.

00:30:32   You will not be surprised to know that the review units provided by Apple were already

00:30:36   updated to 11.1.

00:30:39   I also, for me, my watch swapped over automatically.

00:30:43   So during the setup process, they were like, "Hey, do you want to pair this watch to this

00:30:47   phone?"

00:30:48   And I was like, "Sure."

00:30:49   that I had to do the thing with the you know, you point the camera at the little thing and then it took like five or

00:30:55   Ten minutes and my watch was ready to go. So that was perfect for me. Everything was fine

00:30:59   I've seen a lot of people complaining that watches kind of went a bit awry, but I had no problems

00:31:04   It seemed that whatever the process

00:31:06   How it's supposed to be for me this time it worked that way

00:31:10   You know, maybe I can maybe there's some conspiracy theory, right?

00:31:14   Because we always complain about this stuff that maybe you know

00:31:16   Somebody adjusted my iCloud settings to make sure this wouldn't happen to me

00:31:19   But I say Jason this time I have no complaints about setup of this device

00:31:25   So hats off to Apple because they've made some big they've obviously made some big changes to that and it worked perfectly

00:31:32   Yeah, the last two years since we had our real

00:31:34   unfortunate iPhone 6s setup experiences Apple has made some great strides on the software side to make

00:31:44   It's not without its issues and people definitely ran into some things, but you can see

00:31:49   The the trend here is that somebody somewhere at Apple said you know what setups too hard

00:31:56   Setups not this is I mean they probably said a similar thing to what we said two years ago

00:32:01   Which is this is supposed to be one of the happiest days of your year. It's iPhone upgrade day

00:32:05   Maybe you know for most people it's every two or three years where it's like you get a new iPhone

00:32:10   you're really excited, and then you end up super frustrated and angry because of

00:32:14   all of the weird things that happen when you update. It should be delightful and

00:32:19   over the last two years, you know, it's not perfect but they have really made a

00:32:23   concerted effort to make it a more delightful and less painful upgrade

00:32:29   process because it should, right, your first day with your new iPhone should be

00:32:32   happy, not frustrating. You should spend over a thousand dollars, right, like you should be able to

00:32:36   sit down and play with the thing to their heart's content.

00:32:39   Right? I know like a lot of people including me like I clear my afternoon. I

00:32:42   was like I want to spend my afternoon playing with my new toy and I got to. Now

00:32:47   okay so face ID I think is one is like a lot of people talking about this is like

00:32:52   the big the big thing here but for me the screen. The screen is the biggest

00:32:56   feature that this is the thing I was most excited about and it's the thing

00:33:00   that I'm most impressed at. So with the notch I barely ever pay attention to the

00:33:05   I forget that it's there. Every now and then I'll open an application that is all white

00:33:11   and then I see it as if it wasn't there before. It's very, very strange. Right? So like I'm

00:33:16   on my home screen and just doing whatever and I open like airmail which is all white

00:33:20   and I'm like, oh, I don't know what it is but in some places I just don't pay attention

00:33:25   to it at all. And I love the way that the apps look when they're updated. I love the

00:33:32   the way that it all just flows around, it looks beautiful to me. I was very surprised,

00:33:37   like I picked up my phone at one point and, like my old phone, my 6 plus, my 7 plus, 7

00:33:45   plus, I had a 7, yeah 7 plus. And the squared corners looked out of date, which was really

00:33:53   weird. Like I picked it up and I was like huh, I'd only been using it for a few hours

00:33:58   but there was just something about it, like the square corners looked old now. You know

00:34:02   There's always that thing right that like as soon as there's a new Apple product the old one looks decrepit

00:34:07   And for me that was it. It was the square corners

00:34:10   It was like it immediately stuck out to me as a thing that looked old very strange. I

00:34:14   Love true tone love true tone all my devices and I think true tone makes screens look so wonderful

00:34:22   and I am so happy to have it on my iPhone now because like paired up with the the

00:34:28   wide color stuff and the OLED screen like this screen just looks incredible

00:34:32   But part of the screen stuff part of the overall size of the phone for me

00:34:37   Obviously comparing it to the plus is a big point. I have been a long proponent of the plus

00:34:41   From the six and the seven and I would have been about the eight, you know

00:34:45   If that was a fun that I would have got that's what I would have got I have you know plus Club

00:34:49   It's a big thing for me. I

00:34:51   Am totally fine with the ten, huh?

00:34:56   All right, so what did you get from the Plus and what do you did you feel like you give up something or is it giving

00:35:02   You enough of what you got from the Plus that it doesn't matter

00:35:05   So one of the big reasons for me why I got the Plus and stuck with the Plus is information density

00:35:10   I was looking to get as much information on the screen as possible

00:35:15   Because a lot of what I'm doing on my devices is related to work, right? So like emails and messages and you know when I'm

00:35:22   Relaxing I'm reading tweets, you know, like it's stuff like that

00:35:26   and honestly like I've done some tests like just side by side looking at it you

00:35:31   can see just as much or more on screen in these applications on the 10 than you

00:35:36   can on the plus so in an email I can see more emails I see one more email in

00:35:41   email in my message threads I see one more message on the 10 in you know in

00:35:46   Twitter and tweetbot I see more in notes I see a little bit more the only time

00:35:52   that I've had a situation where I saw less was using the keyboard in notes, I

00:35:58   would see one less line. So in everything that I tried, I got basically the same

00:36:04   result. Like I could see just the same amount of information on and I can't on

00:36:10   the X then I could on the plus. Like I know that landscape mode is more

00:36:14   condensed but I never use landscape mode. Like I never used it except for video

00:36:20   And honestly like watching video on the 10 is perfectly fine, right? Like I have no problems with that at all

00:36:25   It's a big enough screen for that stuff

00:36:28   So the landscape mode doesn't bother me

00:36:30   Like I can feel that this phone is smaller and I noticed it on the keyboard

00:36:34   But I've gotten I have adapted to the smaller keyboard

00:36:37   Significantly faster than I would have expected. I think for me personally

00:36:41   It's actually nicer because I use G board and I mostly swipe with one hand

00:36:47   I used like a swipe typing. It's easier to do swipe typing on a narrower phone

00:36:51   But even when I'm typing normally like I have adapted to that part quicker than I would have expected

00:36:56   You know like a couple of days and it didn't feel small to me anymore

00:37:00   but I

00:37:02   Think for me like this phone gives me what I wanted from the plus

00:37:06   I have a better camp, you know at the great camera and I have the space, you know

00:37:10   The space to see all the stuff that I want to see

00:37:13   The jury's still out on battery for me. Like I don't feel like I've really gotten a good sense of the battery life

00:37:18   But all phone battery life is bad right like this I'm never happy

00:37:24   So as long as it can give me what you know so far

00:37:28   I feel like I'm getting just as much but I really I need to do more like concerted tests

00:37:33   But in regards to the screen size like it's fine. It feels perfect for me. Like I'm I have no problems of it at all

00:37:40   Well, that's, I mean, this is the, I'm trying to understand what's inside the mind of the

00:37:47   iPhone Plus user, right? Like, what you got out of it versus what you get out of this.

00:37:54   It's interesting, yeah, I mean, and from my perspective, like I said last week, I get

00:37:57   stuff like the dual camera, which, you know, if you had gone down, it's not just, it's

00:38:01   not just what are you giving up in going down in size, it's also what you are not giving

00:38:08   up that you previously would have to go down in size, like the dual camera. So it's a

00:38:13   little bit of both.

00:38:14   And as David asked in the chat room, isn't there less space overall? Isn't this a different

00:38:19   size class? Look, I struggle to really understand a lot of the way that these screens match

00:38:25   up. Some people say it's bigger, some people say it's smaller. It seems to be a bit of

00:38:29   a crapshoot depending on what statistic you're looking at. So I decided to make my test a

00:38:33   real world test. I looked at lists. And in lists, which is what I'm looking at most of

00:38:38   the time, lists of things, lists of information, I'm seeing the same amount of stuff. So that's

00:38:45   what I want. Like I don't need the screen to be huge. I just need to get a lot of stuff

00:38:50   on the screen. And I'm using the same settings for dynamic type and all of that stuff. And

00:38:55   I'm getting what I'm looking for, right? Like, I'm not, I don't feel like I'm losing space,

00:39:01   The only place where I feel that way is when I'm using an application that isn't optimised

00:39:05   for the X.

00:39:06   Because then I'm just using an iPhone 8 sized application and I really feel it then.

00:39:13   But most of the apps, the vast majority of apps that I use on my phone with any frequency

00:39:19   have been updated and they look fine.

00:39:24   Your mileage is going to vary on this depending on what you like a Plus phone for but all

00:39:29   all of my uses of a plus phone are taken care of with this screen.

00:39:35   So I've noticed a bunch of changes to iOS.

00:39:39   One of them, one of my favorites actually, is the the tactic feeling on the flashlight

00:39:44   and camera buttons on the cover sheet.

00:39:46   It feels like the home button.

00:39:48   It's wild.

00:39:49   Like, I don't know if you've felt this, but like, it feels just like clicking the old

00:39:55   home button.

00:39:56   It has the exact same feeling to me.

00:39:58   Yeah, you're right which is genius because it's like

00:40:01   That's all it was right like it was just a tactic feedback and they've done it on there

00:40:06   I'm like, oh wow

00:40:07   Like you click it and it just feels like there's a button going down a very impressed with that and I like just clicking them

00:40:12   I just I do I click the flashlight on and off now because it's just a funny little feeling to me

00:40:16   But yeah, I was very surprised about that the new gestures the home gesture and the multitasking gesture

00:40:24   I've gotten used to those really quickly quicker than I would have thought. I have noticed

00:40:28   just a slight pain in my thumb but I'm not surprised by that because one I've been using

00:40:35   the phone way more than normal and two there's just a new gesture that I need to get used

00:40:38   to. This is not abnormal for me you know maybe I have bad hands but when I change a thing

00:40:44   like this it just takes a little while for my hands to get used to the change. I'll give

00:40:50   a top tip to people. There seems to be a lot of misunderstanding or like a lot of different

00:40:56   ways that people think that you activate the multitasking, right? Like I've seen like a

00:40:59   million different ways of how you do it. To me, the one that I found the best is just

00:41:03   swipe up and hold for a second anywhere on this, like from the bottom. You don't have

00:41:07   to go all the way up to the top. You don't have to go from the left hand corner to the

00:41:10   right hand corner. Just swipe up from the middle and hold for a second and then you

00:41:14   get the multitasking view pop up. Nice and simple. Like that's worked great for me. Um,

00:41:19   I don't know about you, Jason.

00:41:22   - I never had a problem with it.

00:41:25   Once I realized the gesture is essentially

00:41:27   just swipe your thumb up and hold it.

00:41:29   - Yeah.

00:41:29   - Like that's all that happened and it worked fine.

00:41:34   It's funny, you remind me,

00:41:36   one of the things that I have noticed

00:41:39   that you asked about earlier on is,

00:41:40   so I went to a college football game this weekend

00:41:43   and I took some pictures with the 10

00:41:46   and I telephoto lens and then I zoomed in.

00:41:49   So I use a digital zoom above the telephoto lens zoom

00:41:52   on that camera to get these pictures

00:41:55   from the stands of the football game.

00:41:58   And they are really good, like, shockingly good.

00:42:04   Even zoomed in where I would think,

00:42:06   "Oh, well, it's a digital zoom.

00:42:07   It's gonna be really awful."

00:42:08   They actually look really good.

00:42:10   And so I just -- it was one of those moments

00:42:12   where I took a bunch of pictures

00:42:13   and realized just how good this camera is,

00:42:17   especially since it, as somebody who's coming

00:42:19   from never having had the telephoto lens.

00:42:21   So, you know, as being able to zoom in that much further

00:42:24   and still have that much sort of like initial quality,

00:42:27   very, I was very impressed with that.

00:42:30   - It's great, right?

00:42:31   - Just throwing it on the pile.

00:42:34   And, you know, it's funny you mentioned

00:42:37   the thumb swipe up gesture

00:42:39   and we're talking about multitasking.

00:42:41   I'll tell you the part that actually has really compromised

00:42:44   me is on the iPad because the iPad is like a half step

00:42:49   in iOS 11 where it's kind of like the iOS gestures

00:42:54   on iPhone 10, but kind of not.

00:42:57   And what I found is I really just want the iPhone 10

00:43:00   gestures on my iPad now.

00:43:01   Like I wanna swipe up and get, you know,

00:43:05   swipe up to home, swipe up and hold to get to a,

00:43:08   you know, multitasking.

00:43:09   I like having control center there on the swipe up,

00:43:11   but I find myself in that weird position now

00:43:15   where like there is a swipe up gesture on the iPad.

00:43:18   So I do it and then the doc pops up and I'm like,

00:43:21   oh right, yeah.

00:43:22   And then I can do, you know,

00:43:24   I can usually just hop over to another app there,

00:43:26   but this is gonna be interesting in terms of how I build

00:43:29   kind of a model in my mind of like interacting

00:43:31   with the iPhone versus interacting with the iPad,

00:43:33   because the rules are different on both now

00:43:37   with iOS 11 and the iPhone 10.

00:43:38   - Wow, I mean, Face ID, right?

00:43:40   Like that's a big one. - Well, that's true too.

00:43:43   That's true too, having to put my finger on the,

00:43:46   but I assume that in the next, if not in 2018,

00:43:50   then in 2019, the iPad will be updated to do Face ID.

00:43:54   The iPad Pro will be updated to do Face ID

00:43:57   and will probably, and probably drop a,

00:44:00   would not surprise me if it drops the home button

00:44:03   and goes to these gestures as a part of a, you know,

00:44:05   a revamp of the iPad Pro.

00:44:08   And the advantage to that will be that

00:44:10   the behaviors will be the same

00:44:12   because it is a little bit weird to do that.

00:44:15   I just learned the swipe up gesture

00:44:17   in two forms for my iPad.

00:44:20   And now I've learned them for the iPhone

00:44:22   and they're different.

00:44:23   But related, that's the interesting thing

00:44:26   is that you can tell,

00:44:27   I mean, so much of the story of these things

00:44:29   is the groundwork that's been laid.

00:44:30   I saw somebody tweeted about this this week

00:44:33   and I nodded my head

00:44:36   'cause I think I wrote a Mac world article about this

00:44:38   that said the same thing, which is like,

00:44:39   raise to wake is the perfect example of like,

00:44:42   that, how is that not like,

00:44:46   that's a feature that exists

00:44:47   because they knew face ID was coming.

00:44:49   Like they have spent a couple of years

00:44:52   overhauling unlock status,

00:44:54   making you be able to unlock the phone

00:44:56   without pressing the button in,

00:44:57   in order to tap on notifications or swipe to widgets.

00:45:00   Like it's hard not to look at this

00:45:02   as part of a larger project that culminates in face ID,

00:45:07   because now all of that stuff has paid off

00:45:10   when you can raise the phone to wake it

00:45:13   and then look at it and unlock it

00:45:15   and then be at that screen

00:45:16   and choose whether to stay there or not.

00:45:18   They all go together.

00:45:19   Like I use raise to wake all the time now.

00:45:23   That's how it's basically raised to unlock your phone.

00:45:27   So, and they've been laying this groundwork

00:45:29   for a couple of years in iOS.

00:45:32   - I miss the battery percentage indicator.

00:45:37   Honestly, I would prefer to just be able to replace

00:45:39   the battery icon with a percentage number.

00:45:42   Just the little icon doesn't work for me.

00:45:45   Like I like the percentage.

00:45:47   And I don't like control center.

00:45:49   I don't like where it is.

00:45:50   I don't like the way that you pull it down now.

00:45:53   I don't like the animation.

00:45:55   Like the animation is really weird.

00:45:56   It seems to come up from the bottom.

00:45:57   It's like a very--there's a lot about Control Center that I'm not a big fan of right now,

00:46:03   and I'm waiting to see how that kind of shakes out, but overall, I don't like the changes

00:46:08   there, to be honest.

00:46:09   I agree.

00:46:10   I find myself getting frustrated where--maybe I'll get over it, but I have those moments

00:46:15   of like, "Oh, right, Control Center."

00:46:18   And I realize I have to, you know, not use--I'm in one mode where I'm just sort of like holding

00:46:23   it in my left hand and using my thumb, and then I'm like, "Oh, but I can't do that.

00:46:27   I have to go and swipe up from the top and bring it down

00:46:29   and it's just a different kind of mode.

00:46:32   And you're right, it's a weird effect

00:46:34   'cause it like fades in as you swipe down.

00:46:36   - So strange. - Like the old,

00:46:38   the old status bar comes down with it,

00:46:41   which is really weird.

00:46:45   And I, yeah, I miss having it more easily accessible.

00:46:50   - So I love Face ID.

00:46:52   I've found that, you know, in a lot of times,

00:46:56   you do wait a little bit longer, maybe,

00:46:58   than it would be for Touch ID, but it feels better.

00:47:01   Like it just feels better.

00:47:02   Like I pick up my phone and I look at it

00:47:04   and then it unlocks.

00:47:05   Or like I open one password and don't have to like

00:47:09   move my thumb down again to the,

00:47:11   it just feels right to just press the app

00:47:13   and just look at it and then it opens up.

00:47:15   Like I've found that to be a more natural,

00:47:18   nicer feeling way of doing authentication

00:47:21   rather than every time I need to authenticate something,

00:47:24   I have to push my thumb and like hold and wait.

00:47:27   Like it just feels right.

00:47:28   The animation pops up, it tells me it's done

00:47:30   and it goes through.

00:47:31   Like I really like all of that.

00:47:32   And I like some of the changes that it's brought as well.

00:47:36   Like the automatic hiding of notification content is awesome.

00:47:39   I like the, I've never done that before.

00:47:42   I've always had my notification show

00:47:43   because I didn't want to be unlocking all the time.

00:47:45   But now just whenever I look at my phone,

00:47:47   they just pop out and I really like it.

00:47:50   And also something that's amazing for me,

00:47:52   I've said already on the show,

00:47:54   use Gboard all the time right like I don't have Apple's keyboard installed I

00:47:57   just use Gboard and which is Google's keyboard and when I would have when I

00:48:03   would reply to things like messages from notification center prior to getting the

00:48:07   iPhone 10 I would get I wouldn't be able to use Gboard because the phone's locked

00:48:12   so I would get this like an Apple keyboard without autocorrect is how it

00:48:18   would work it was kind of frustrating a lot of the time but it was just one of

00:48:22   trade-offs but now because my phone unlocks whenever I look at it when I reply to messages

00:48:26   from notification center I get to use Gboard which is awesome.

00:48:30   This is a little thing for me that's made my experience way better because I'm able

00:48:34   to use the keyboard that I like and use and that knows all of my auto correct and all

00:48:38   that sort of stuff from the notifications because the phone's unlocked now whenever

00:48:43   I look at it.

00:48:45   And one other thing like if Face ID fails on me I don't get frustrated with it the way

00:48:50   I would get frustrated with Touch ID because in the back of my mind I know that every time

00:48:55   I put my passcode in I'm training the Face ID system. This all came out a few weeks ago,

00:49:03   Apple kind of explained how they're working with this, that if Face ID fails but there

00:49:07   is a percentage where it thinks it might be you, if you enter in your passcode it will

00:49:13   add to the data points that Face ID is collecting to make the system better overall. So every

00:49:18   time I do it I'm like, "Okay, I know I'm doing this now, but by putting this time in, I'm

00:49:22   training the system." That's been a weird kind of feeling for me, but I'm like, "Okay,

00:49:27   it's going to get better." I love Animoji, obviously.

00:49:30   Yeah, we need to talk about Animoji. We sure do. I mean, Animoji is exactly what

00:49:35   I wanted it to be. I'm having a great time with it. But Harry McCracken started an incredible

00:49:39   thing called Animoji Karaoke, and it has sweeped Twitter over the last few weeks where people

00:49:46   who are creating just these wonderful videos of Animoji characters singing along to music

00:49:52   and there are just a million fantastic examples of this and they're so much fun and I am loving

00:49:59   watching them. You've even made one or two.

00:50:02   I made a couple of them. The first thing I did was I sang along to the Robot or Not theme

00:50:05   as the robot and I posted that in Slack. I don't think I posted that on Twitter.

00:50:08   You sent that to me as well in our message.

00:50:11   And that's it, that's it, that's what I did.

00:50:14   And then I did a 10-second thing of "Get Lucky" by Daft Punk as sung by the robot because

00:50:22   it felt like an appropriate thing.

00:50:24   And then, of course, what happened is that this definitely gained momentum and the optimal

00:50:29   way to do it is you go to full screen mode in Animoji in Messages where you tap on the

00:50:34   little arrow up and it expands to full screen where the top half is all the Animoji and

00:50:39   the bottom half is the different choices for which character, and you do a screen recording.

00:50:44   And then you can just go forever instead of just 10 seconds. It doesn't record your audio,

00:50:48   but it'll record and then you overlay with the original music or whatever. And so not

00:50:55   to be limited to singing, I acted out a scene from Star Trek II, The Wrath of Khan, where

00:51:03   where Khan, who is a chicken, taunts Captain Kirk, who is a fox.

00:51:10   And I did some acting. I haven't done any of these yet, but I'm not

00:51:16   ruling it out. I probably will do something, like some fun stuff with it. I love it. I'm

00:51:22   sending them to everybody. I'm sending the video clips, I'm sending stickers. I'm

00:51:26   having just a great time with Animoji. There are some cool features to Animoji that are

00:51:30   not necessarily obvious and Jason you wrote a great article on Tom's Guide which I'm going

00:51:34   to put in the show notes about how to use Animoji in full. Like I didn't know the full

00:51:39   screen thing was there and a lot of people don't know that you can actually turn them

00:51:44   into stickers so it's worth looking over that guide. It's actually a really good guide that

00:51:48   you put together.

00:51:49   Yeah you do a funny face and then tap on the face and drag it up and it's a sticker or

00:51:55   tap on it, just tap on it and it will insert a still or you can record for 10 seconds.

00:52:00   So you don't have to do the 10 seconds with audio endlessly looping thing.

00:52:03   If you think that's annoying, you can also just do a funny face and drag it in and

00:52:08   you've got a sticker, which is cool.

00:52:09   Yeah.

00:52:10   And Apple stumbled across, uh, like a goldmine, like this, this Animoji

00:52:15   karaoke thing is going to sell iPhones.

00:52:18   Like I remember, do you remember I said, I believed Animoji would be an iPhone

00:52:22   seller, like in the same way that photo booth was, I think that this is the thing,

00:52:27   right?

00:52:27   Like people making these little videos,

00:52:29   like I expect to see maybe before iOS 12

00:52:34   or at least in iOS 12,

00:52:35   some more ways to use Animoji on the iPhone

00:52:39   as well as of course there will be more characters

00:52:41   like there will be.

00:52:42   I would be very surprised if we didn't see like Buzz Lightyear

00:52:45   or something.

00:52:46   - Oh, that's interesting.

00:52:47   Well, they've got, right,

00:52:48   just that you could do a face map

00:52:49   of an existing animated character too.

00:52:51   That's, and they've got the Pixar kind of deals

00:52:53   or Mickey Mouse maybe.

00:52:55   You know what, why they won't do that.

00:52:56   You know why those won't happen is because people

00:52:58   would make them say terrible things.

00:53:00   - That's a possibility.

00:53:03   - Right? - Yeah, I thought of that.

00:53:04   - And that's the Mickey Mouse,

00:53:05   there's a famous Harlan Ellison story

00:53:07   about how his first day on the lot at Disney,

00:53:10   working a job at Disney, he was in the cafeteria

00:53:14   and loudly, 'cause he's a loud

00:53:17   and by all accounts annoying person,

00:53:18   was doing a Mickey Mouse, a dead on Mickey Mouse impression

00:53:21   and having Mickey Mouse's voice say horrible things

00:53:25   and he was fired immediately.

00:53:27   Like, right? - That's a good point.

00:53:28   - So there's the like brand, brand.

00:53:30   So Buzz Lightyear may not be available,

00:53:32   but emoji belong to no one.

00:53:34   And so perhaps we will see more variations on emoji.

00:53:39   I also keep thinking like the smiley face

00:53:42   and all of its variants, you could, you know,

00:53:45   you could do that.

00:53:47   Yeah, it'll be interesting to see if they,

00:53:49   if they ride this a little bit further

00:53:51   or if everybody is done with this,

00:53:53   Even if this blows over in a week or a month,

00:53:58   it's great publicity for the iPhone 10.

00:54:01   And that is, you know, you can't,

00:54:04   you can engineer some publicity,

00:54:06   we talked about that last week with Apple's sort of PR plan

00:54:09   for the iPhone 10.

00:54:10   Some of this stuff though, you just have to hope it happens.

00:54:12   And I would bet people at Apple were thinking,

00:54:15   people are gonna really like this.

00:54:16   The internet's gonna find fun ways to do this.

00:54:18   And I don't think we've gotten to the end of it, right?

00:54:20   I think this is gonna keep going.

00:54:22   I would be surprised if we don't see some late night talk shows like using this to do

00:54:27   things too, just as a, you know, again, trying to be kind of current and of the moment.

00:54:32   Mhmm.

00:54:33   Exactly.

00:54:34   So I think, yeah, we're gonna, it's good for Apple though, ultimately.

00:54:38   And I had fun being Chicken Khan.

00:54:41   Buried alive!

00:54:43   I love, I absolutely love it.

00:54:46   It's such a great feature.

00:54:48   It's fun.

00:54:49   It is something of the phone for me overall.

00:54:52   I love it.

00:54:52   I love this iPhone so much.

00:54:54   I'm so happy with it.

00:54:55   - It's really good.

00:54:55   - I feel like the last few years,

00:54:58   iPhone releases have been,

00:55:00   they've been cool,

00:55:01   but not like they haven't blown me away.

00:55:03   - Everything is iterative with the iPhone,

00:55:06   most of the time.

00:55:07   And you get that moment like the six was really different.

00:55:09   And then you get 6.1, which was the 6X,

00:55:12   6.2, which was the seven,

00:55:14   6.3, which is the eight essentially.

00:55:17   And the same way with like the five and the five S

00:55:19   or you could argue the 4, 4S, 5, and 5S were kind of all the same phone?

00:55:24   No, I would say that there have been bigger jumps, right?

00:55:26   So like, you know, the 3G, whatever, it was new.

00:55:29   But then we went to the 4, which is amazing.

00:55:31   Then there's one more iteration, and the 5 got bigger, right?

00:55:34   So it was like, "Oh, the screen's bigger."

00:55:36   And then the 6 got bigger still, and there was the plus.

00:55:38   Like I said, it's arguable.

00:55:39   The 5 is sort of a stretched 4, so you could argue it, but yeah, that was a bigger change

00:55:43   because the screen size actually physically changed for the first time.

00:55:48   And you throw Retina in there, that was a big, I would say, a huge improvement.

00:55:52   But so much of it is that the camera's better every year.

00:55:55   And there are other features that are better every year.

00:55:58   And if you buy a phone every year, it's just kind of this march.

00:56:00   If you buy it every two or three years, it's more dramatic, which is great.

00:56:04   And that's what happened with Lauren's phone.

00:56:05   Like, she's gone up three years' worth of iPhone hardware, and it's great.

00:56:10   And she loves it.

00:56:11   The iPhone 8, she loves it.

00:56:12   But the 10 is a big jump and it's a bigger jump

00:56:16   than we've had since the six, which was a while ago now.

00:56:20   - Feels like forever ago. (laughs)

00:56:22   - So, yeah, so that, I was prepared to think it was weird

00:56:27   and a first attempt.

00:56:30   I was really kind of stealing myself to being like,

00:56:33   it's expensive and it's weird and it's maybe not,

00:56:36   maybe a year too early.

00:56:37   All of those things I was kind of like preparing myself for

00:56:42   as I got into it and I felt none of that.

00:56:46   It feels incredibly polished

00:56:48   and a great piece of solid piece of hardware.

00:56:51   It looks great, it feels great, it's fun to use it.

00:56:55   They really nailed it.

00:56:56   When I saw Renee Ritchie's review,

00:56:57   which posted the same time I did,

00:56:59   and he basically said like,

00:57:00   "It's the best Apple product ever," or something like this.

00:57:02   It's wildly hype-ish headline, right?

00:57:07   But I was like, yeah, they killed it

00:57:12   this product. Like I'm not going to say best product ever because I feel like that's elapsed

00:57:16   into potential like self-parity when you do that but this is they got this one like this is a winner

00:57:22   they they did a good job with this product this is one of those that you go like oh yeah this is

00:57:26   sort of like how we felt about the AirPods last year where it's like oh yeah this is like this is

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00:58:53   Jason Snow, it was earnings time. This one came out of the blue for me. I didn't even

00:58:56   know there was so much going on. I'd forgotten that there was an earnings call coming up.

00:59:01   Also I was at Dan Morin's house last week in Boston and he was like, "Hey, are earnings

00:59:06   happening soon?"

00:59:07   And I was like, "Oh geez, I hope they're not happening like tomorrow."

00:59:10   And it was, "Oh no, they're happening next Thursday."

00:59:13   Of course they are.

00:59:14   The day before the iPhone X comes out, the week of the embargoed reviews and all of that,

00:59:19   just throw in Apple's quarterly earnings.

00:59:22   So you know, this is how I spend my afternoon once every three months, which is making charts

00:59:28   and transcribing analyst calls and writing stories.

00:59:31   And it's a--

00:59:32   - Great job you do, Jason.

00:59:33   A great job you do.

00:59:35   - I killed it on the transcription this time.

00:59:38   I used an online transcription tool

00:59:41   and broke it up into little parts.

00:59:42   And I think I beat everybody out with my transcript.

00:59:46   So that mattered for a good 30 minutes,

00:59:49   but yeah, I did that.

00:59:51   And it's fun.

00:59:52   It's good to refer to that.

00:59:53   And then all the pretty charts too.

00:59:54   So a good quarter for Apple.

00:59:57   like this is their fiscal fourth quarter

00:59:59   and it's kind of a sleepy quarter.

01:00:00   I think it's their smallest of all their quarters,

01:00:02   but it was a record fourth quarter.

01:00:06   They made $52.6 billion in revenue.

01:00:09   And from a financial perspective,

01:00:14   'cause this is the one time I turn on like CNBC

01:00:17   every three months is to see sort of like

01:00:19   what are the analysts saying

01:00:20   and the Wall Street people are saying.

01:00:23   And they say lots of stupid things is the answer.

01:00:25   They say a lot of things,

01:00:26   oh, I don't know about this new iPhone.

01:00:27   And they say that every year and they're wrong every time.

01:00:30   And, but this time the way the stock market works, right,

01:00:34   it's all about the future, it's futures trading.

01:00:35   You're basically like betting on where the company's

01:00:38   gonna go in the future.

01:00:39   And if the company says, we're gonna have a great quarter,

01:00:42   then the stock goes up

01:00:43   because that becomes new information that's in there.

01:00:45   And, but then they predict what they're gonna say

01:00:47   and the stock sort of like builds based on the prediction.

01:00:51   So it's, you know, it's a whole thing.

01:00:53   but the Apple guidance, which is Apple saying,

01:00:57   here's how much money we're gonna make next quarter,

01:00:59   the holiday quarter,

01:01:00   which is the biggest quarter for Apple every year.

01:01:03   And they did their predictions, the analysts did,

01:01:07   and then Apple, which is notoriously kind of conservative

01:01:11   in their estimation of what their next,

01:01:13   they very rarely say it's a big number

01:01:16   and then they don't meet it.

01:01:17   They meet their guesses.

01:01:19   Apple's estimate for what they're gonna make next quarter,

01:01:23   during the holidays, was way above the analysts,

01:01:28   so they liked that.

01:01:30   And it would be a record Apple holiday quarter

01:01:35   by quite a bit, actually.

01:01:38   And Apple seems quite confident,

01:01:42   maybe a little less confident in the past,

01:01:44   'cause they definitely have some new things

01:01:47   with this iPhone X and iPhone 8 being out there,

01:01:49   but they seem quite confident that next quarter will be their biggest quarter of all time.

01:01:54   So let's break down some of what happened in financial Q4 and then we can talk a little

01:01:59   bit more about that because that is really interesting.

01:02:01   The future.

01:02:02   The future. So the iPhone, 55% of the revenue for the company. iPhone 8 sales exceeded expectations.

01:02:10   Luca, what was Luca's first name?

01:02:14   Luca is his first name.

01:02:15   Oh, okay.

01:02:16   Yeah, he's Luca Maestri.

01:02:17   Luca Maestri, that's it.

01:02:18   - Mr. Maestri, that's it. - He's the CFO.

01:02:19   - Okay.

01:02:20   - Luca Maestri does not sleep with the fishes.

01:02:23   That's Luca Brasi from "The Godfather."

01:02:25   - You know what?

01:02:26   That's why I had to ask you

01:02:27   because I just hear Brasi in my head.

01:02:29   I'm so sorry, Luca. - Luca Brasi.

01:02:30   - Mr. Maestri and Cook noted that since the 8

01:02:34   and the 8+ went on sale,

01:02:36   that they became the two most popular iPhone models

01:02:39   and have been every week since then, like of all time,

01:02:42   which is wild.

01:02:43   - That is a direct,

01:02:44   That is a direct attack on some analyst report

01:02:49   that said that the iPhone 7 was selling better

01:02:52   than the iPhone 8.

01:02:53   That's what that's about.

01:02:55   - Right, okay.

01:02:56   So they instantly became the most popular

01:02:58   is what they're saying.

01:02:58   - Yeah, yeah, the 7 did not stay above them.

01:03:01   They immediately became the most popular

01:03:02   and have continued to be.

01:03:03   So they were really batting down, without mentioning it,

01:03:05   they were batting down a very specific report

01:03:07   that the iPhone 8 sales were weak

01:03:09   and that the 7 sales were actually better than the 8,

01:03:11   which was based on a bunch of numbers that were really dumb

01:03:14   and that everybody looked at and said,

01:03:15   "Really? That doesn't seem right."

01:03:17   And then Apple's like, "Yeah, it's totally not right."

01:03:20   - The iPhone 8 Plus is the best selling to date

01:03:23   of any of the Plus models, which surprised Apple.

01:03:26   - Yeah, this is once again,

01:03:28   I love when they admit that they were surprised

01:03:30   and they did that a couple of times in this call.

01:03:34   And this was one of them, which is the iPhone 8 Plus selling

01:03:38   presumably in its mix with the 8,

01:03:41   the best selling Plus model to date.

01:03:44   and that they weren't really anticipating it

01:03:46   to do that well.

01:03:47   And it shows strength in, right?

01:03:50   Because them being surprised means that despite

01:03:53   all of their analysis they've got,

01:03:55   which is way more than anybody on the outside has,

01:03:58   they still can be surprised by demand for certain products.

01:04:02   And the plus, the eight plus definitely did that.

01:04:05   - I mean, if I was gonna put on my analyst hat for a moment,

01:04:08   I would expect it's because the plus

01:04:11   is not the top of the line anymore, it's the middle.

01:04:13   and that people are just drawn to that.

01:04:16   Like, it now sits in the middle.

01:04:18   - I have a very important question.

01:04:19   What does your analyst hat look like?

01:04:20   Does it have like a propeller on top?

01:04:21   - That was exactly what I was thinking of actually,

01:04:24   that it was one of those hats with the propellers on the top.

01:04:26   - It says analyst on the front

01:04:28   and there's a propeller on top.

01:04:29   - And that propeller is to help me shoot up the charts.

01:04:33   Production is ramping up on the 10.

01:04:36   They're making more and more of them

01:04:37   at a rate that they're attempting to make

01:04:39   more and more of them all the time, right?

01:04:40   Like that's, you know, they're like,

01:04:42   "Yeah, okay, we're gonna keep making them."

01:04:44   - He said, "We don't know when they're gonna be

01:04:45   "in balance or not," but they always say that, honestly.

01:04:49   They're always kind of struggling with how they get

01:04:51   into supply-demand balance of a new product.

01:04:54   And what they didn't say is,

01:04:56   "We anticipate really limited demand,

01:04:58   "and therefore we're not gonna be able to sell

01:04:59   "very many in the holiday quarter."

01:05:01   And in fact, their estimates for margins and for profits

01:05:06   in the holiday quarter suggest that they think

01:05:08   the iPhone X's gonna sell pretty well,

01:05:10   as are the 8 and the 8 Plus in the holiday quarter.

01:05:13   So this is them showing some confidence in their ability

01:05:16   to fill the supply chain.

01:05:18   And we've seen that, like the phone is not back ordered

01:05:20   until January or February at this point.

01:05:23   Even now you can still get, I believe, the phone,

01:05:26   the iPhone 10 in December,

01:05:27   and they still show up in stores.

01:05:30   So they are doing a pretty good job

01:05:32   of fulfilling demand and ramping up.

01:05:35   And the fact that your iPhone required a software update

01:05:37   suggest that they've been building these things for a while

01:05:40   in order to get a big pile of them to sell at launch.

01:05:45   The other thing that they said that they aren't sure about,

01:05:47   which I think was again telling,

01:05:49   is this fact that they're selling the eight,

01:05:51   eight plus and the 10.

01:05:52   And somebody asked them like,

01:05:54   what does that mean in terms of the mix of your sales?

01:05:56   And are you gonna suppress sales of the eight for the 10?

01:06:00   Or is the 10 gonna make people defer to later

01:06:02   and all of that?

01:06:03   And Tim Cook said, you know, we've thought about it a lot.

01:06:05   We've got some ideas.

01:06:07   this is our best guess, but we've never done this before.

01:06:10   And he actually kind of laughed.

01:06:12   He was like, we've never done this before, so we'll see.

01:06:15   Like there was an admission there, at least a little bit,

01:06:17   that Apple, which likes to have everything wired,

01:06:21   everything locked down, like here's what's gonna happen,

01:06:23   we know what's gonna happen, we're experts, we got this.

01:06:26   They're like, yeah, the 10, the eight, eight plus, the 10,

01:06:29   we don't really know how that's gonna go, we're confident,

01:06:31   but we could be taken by surprise.

01:06:34   And that's, they are more likely to disclose that

01:06:37   in a financial context, right?

01:06:39   Because they are trying to provide financial analysts

01:06:43   with an understanding of the risks going forward

01:06:46   and the limits of their knowledge

01:06:48   and what they're able to project.

01:06:50   But as people who follow the products like we do,

01:06:53   it's still interesting information that they're,

01:06:56   you know, they're not quite sure how it's gonna do.

01:06:58   'Cause we talked about what a gamble this is on one level

01:07:00   to kind of take this machine that makes money,

01:07:04   which is the iPhone, and change how it runs

01:07:08   by having this extra product in the product line

01:07:11   at the high end.

01:07:12   And you know, this is them saying,

01:07:14   "We think it's gonna do well, but we don't exactly know."

01:07:18   - The iPad.

01:07:21   Second quarter with a sales increase.

01:07:24   Yes.

01:07:25   - iPad not dead for the second straight quarter.

01:07:28   Isn't that nice?

01:07:30   So excited, so excited.

01:07:33   10.3 million units beating 9.3 from the quarter before.

01:07:36   And the really, the best part of this,

01:07:40   the very best part of this is that the average selling price

01:07:43   took a bump up, which is a very, very good thing

01:07:47   because last quarter, the average selling price went down.

01:07:51   And what it indicated was that the increase in unit sales

01:07:55   for the iPad year on year was because there was pent up

01:07:57   demand for a cheap regular $329 iPad that they were going into education and the fear

01:08:03   was that's what people wanted and the pros didn't care about. The average selling price

01:08:08   going up means that the 10.5 did its job and I'm so frickin happy because the iPad is on

01:08:16   the rise proving proving that if you put the effort into the product as they have with

01:08:23   hardware and software in the last 12 months, you will sell them. And this is really, really

01:08:28   good news for people like me and you who love and use our iPads. I'm so excited about it.

01:08:34   Yeah, it is. Just put this in context. What was it? 13 straight quarters, 12, 13 straight

01:08:42   quarters of year-over-year unit decline, followed by two straight quarters of more than 10%

01:08:48   of double digit unit growth year over year.

01:08:51   It's gonna be interesting to see how the holidays shake out

01:08:56   and will they be able to go year over year?

01:08:58   'Cause that will mean that they'll need a bigger bump

01:09:00   because the holiday sells a lot of iPads.

01:09:01   So how will that do?

01:09:04   I would, I'm more inclined to believe

01:09:06   that they will grow year over year in the holiday quarter too

01:09:08   because it feels like they've righted the ship here

01:09:10   a little bit, that they hit bottom

01:09:12   and now they're in a growth path

01:09:14   and it may not be an exponential growth path,

01:09:16   But even if that iPad grows 10 to 15% a year,

01:09:21   that is a, they're moving in the right direction.

01:09:23   - Or even stabilizes.

01:09:25   That's all we really wanted was just stability.

01:09:28   The Mac continues stability, right?

01:09:30   And we'll talk about that in a moment

01:09:31   'cause there's some interesting stuff there too.

01:09:33   But the Mac is relatively stable.

01:09:35   The iPad was just falling, falling, falling.

01:09:38   So stability and increase, I mean, it's amazing.

01:09:42   I could have, I dreamt for sales increases, honestly.

01:09:45   All I was really hoping is that it would just stop falling.

01:09:49   And this is just fantastic news.

01:09:51   - I'll also point out the revenue last quarter,

01:09:53   the year over year revenue increase for the iPad.

01:09:55   You mentioned the ASP, which is absolutely true.

01:09:57   Like they're selling more iPad Pros.

01:09:59   The 10.5 iPad Pro is driving a lot of the sales increase

01:10:04   where it was last quarter, it was that cheap iPad.

01:10:07   And so last quarter, year over year unit sales went up 15%,

01:10:12   but revenue only went up 2%.

01:10:14   This quarter, they were up 11% in units

01:10:18   and 14% in revenue.

01:10:20   So you can see it in a couple of different places

01:10:23   that this is a good story.

01:10:25   So second straight quarter of good story for the iPad,

01:10:29   but that story was about the cheap iPad

01:10:32   and this quarter story is about the iPad Pro doing well.

01:10:35   So yeah, iPad fans, thumbs up.

01:10:38   It was good.

01:10:40   It was a good result.

01:10:42   2017 was the best year of sales ever for the Mac.

01:10:46   Who would have thought that?

01:10:47   (laughing)

01:10:49   Who would have guessed that one?

01:10:52   The fourth quarter was the best quarter increase

01:10:54   of all of them.

01:10:55   5.4 million units compared to 4.9 million the year before.

01:11:00   Apple said that they sold more Macs in China

01:11:03   than they ever have before in mainland China.

01:11:05   ASP is up and this, and Apple suggested,

01:11:08   this is all due to the MacBook Pro.

01:11:11   - Yeah, this is basically, 'cause this is not,

01:11:14   as far as I can tell, the best year for the Mac

01:11:19   in terms of units, but it is in terms of revenue.

01:11:24   And the reason for that is the MacBook Pro, right?

01:11:30   It's that that's a more expensive computer,

01:11:34   that they sold a lot of them and it's more expensive.

01:11:37   And so the average selling price went up

01:11:39   and the revenue went up.

01:11:40   So they averaged 6.5 billion in revenue per quarter

01:11:45   in fiscal 2017.

01:11:49   So that's healthy.

01:11:52   That's the most that they've, in my charts,

01:11:54   that's the most they've ever done

01:11:55   in a four quarter average is 6.5.

01:11:58   So that's good.

01:11:59   That is their best of the year.

01:12:01   In 2015, they did 6.4.

01:12:03   They were close.

01:12:04   Units, they're down at one point at the end of 2015 again,

01:12:09   They sold about 5.15 million Macs per quarter for that year,

01:12:14   and it's 4.82 this time.

01:12:18   So they're coming off of a high in 2015

01:12:21   like they are with so many other products, right?

01:12:23   Like the iPhone especially.

01:12:25   But still, it's a good Mac year, like they said,

01:12:30   it's the best in terms of Mac revenue.

01:12:32   It's a 25% year-over-year change in Mac revenue.

01:12:37   It's four straight quarters of Mac revenue growth.

01:12:40   So I, as a glass half full person, I say,

01:12:46   look, the Mac is a good and growing business

01:12:49   and new Macs drive Mac sales.

01:12:53   I can see how a glass half empty person would say,

01:12:56   one, if you don't like the MacBook Pro,

01:13:00   you look at this and you're like, what do you mean?

01:13:02   I hate that thing.

01:13:03   Why is that driving Mac sales?

01:13:05   I could argue because it's the MacBook Pro

01:13:08   and people are gonna buy it 'cause they need a MacBook Pro,

01:13:10   they need a Pro Mac laptop.

01:13:12   And maybe they care about the stuff you care about,

01:13:16   about the keyboard and USB-C and all that,

01:13:19   but they still need to buy it and maybe they don't care.

01:13:21   But it's been a business success.

01:13:24   I would also say the glass half empty person might say,

01:13:26   well, geez, if the product is successful,

01:13:30   maybe they should pay more attention to it.

01:13:32   But I feel like we had that moment

01:13:35   with the round table that was sort of like,

01:13:38   okay, we hear you.

01:13:39   And we've seen some behavior on Apple's part

01:13:41   in terms of updating Macs more frequently,

01:13:43   like the MacBook Pro got a speed bump at some point.

01:13:46   And we've also seen that the Mac after a down year,

01:13:51   like the iPhone has had a good growth year this year.

01:13:56   So I'm choosing to be hopeful that the more the Mac grows

01:14:00   and the fact that Apple is paying more attention to the Mac,

01:14:02   this is good for the future of the Mac,

01:14:04   especially when you talk,

01:14:06   as they mentioned in the analyst call,

01:14:08   that the PC market contracted.

01:14:11   And so Apple gained market share.

01:14:14   And that is always,

01:14:16   I think Marco made this point on ATP last week,

01:14:18   is you can say that the Mac is boring

01:14:21   and the PC market is boring

01:14:23   because it's a market that is contracting,

01:14:25   but you could also say that it's a huge opportunity

01:14:28   and that Apple could double Mac sales if it wanted to,

01:14:32   because the PC market is boring and contracting,

01:14:36   but Mac sales are growing.

01:14:38   So they could steal even more Mac, more PC sales away

01:14:42   and convert those people to Mac users.

01:14:43   And you can still get a growth business for quite a while

01:14:48   in a market that's contracting.

01:14:50   And so, yeah, I think this is really great news,

01:14:53   as good as the iPad news is,

01:14:55   because it's sort of like off death store,

01:14:58   the Mac news is also really good because after 2016,

01:15:00   you could have looked at it and said,

01:15:01   okay, the bottom fell out of the Mac,

01:15:03   it's just gonna be flat from now on.

01:15:05   And that's not the case,

01:15:06   in fact, it's accelerated this quarter.

01:15:08   - Apple Watch and wearables are growing,

01:15:11   we don't have data on this specifically.

01:15:14   We know that Apple Watch saw a 50% growth year on year,

01:15:17   and that the overall category is up 75% year on year,

01:15:21   probably also including AirPods,

01:15:23   but that's as much as we get statistics wise.

01:15:25   There's no revenue, there's no units,

01:15:27   nothing built into this right now.

01:15:29   - Right, they used these, you know, no details,

01:15:32   just growth numbers to say, Apple Watch,

01:15:35   they said third consecutive quarter of growth

01:15:37   that I assume is year over year, but that's good.

01:15:40   You can do some solving for X and sort of figure out

01:15:42   what the Apple Watch growth is really,

01:15:45   and some of the analysts have done that,

01:15:48   and I think they've done a good job.

01:15:49   As much as I joke about the Bezos chart of,

01:15:52   we don't really know, it's just Tim Cook says stuff,

01:15:55   you can get a sense, and they have said, yeah,

01:15:57   three consecutive quarters of 50% year over year growth is good. That's really good. Like,

01:16:02   that's better than any other product in Apple's product line. And it's a small number, which

01:16:06   is why it can grow so fast, but it's still growing. The Apple Watch is not... Every now

01:16:10   and then I see somebody like, "Oh, the Apple Watch, that's stupid." And it's like, "Well,

01:16:14   okay, but look, they're growing that business 50% year over year every quarter at this point.

01:16:19   That's a pretty good sign that it's doing well and that their wearables is up 75% year

01:16:24   over here says AirPods are doing really well too and I like how they classify those together

01:16:30   as wearables. Like this is their message to Wall Street especially is like we're in wearables.

01:16:35   This is an ongoing thing and it's not just one product. We're going to make little computers

01:16:39   that you put on your wrist or stick in your ears or who knows where else they might go

01:16:43   maybe in your analyst hat. We'll see.

01:16:47   propellers. Services are at an all-time high. $8.5 billion in revenue, up from $6.3 billion

01:16:54   the year before. That is a huge jump. And Luca Maestri, not Brasi, said that Apple Music

01:17:02   has turned the corner, whatever that means. But we can assume that what that means is

01:17:07   they got a lot more subscribers in this quarter. So services is up and everyone's happy.

01:17:13   getting money from all this is the yeah this is the product because it's weird because

01:17:18   it's services and not a physical product and so it changes how you have to think about

01:17:22   Apple's business but it is the the part of Apple's business that is growing like the

01:17:29   iPhone grew in the early days like the iPad grew in the early days where it just it's

01:17:33   like a machine it just keeps on growing and Apple has said they wanted to double their

01:17:38   services revenue from, you know, from 2015 or 2016, maybe by 2020, they expected to double

01:17:45   it and they are on their way to doing that. And the Wall Street people, the money people

01:17:49   love that. If you're focused on Apple as a hardware company, services is weird and different.

01:17:55   And you know, we talked about Apple video service earlier, but like this is all still

01:18:00   a huge part, a huge component of their business and is growing dramatically. And the Apple

01:18:06   music stuff they mentioned, they gave an update to that, which Luca has been doing for the

01:18:10   last few quarters, because once they launched Apple Music, they admitted that the iTunes

01:18:15   sales were dropping. They didn't talk about it before then, but then they're like, "Yeah,

01:18:18   you know, iTunes music sales have been dropping." But what they said this time was that it's

01:18:24   turned the corner, that their music segment is now growing again for the first time. And

01:18:30   that's because they still have iTunes music sales revenue, but their Apple Music is growing

01:18:35   enough to offset the loss of a la carte music sales.

01:18:42   And so they've got a growing music business again.

01:18:46   And then looking forward to Q1, so as Jason mentioned, this Apple forecasting, like just

01:18:55   a storm of a quarter, a guidance of 84 to 87 billion dollars for the quarter, which

01:19:02   be between $5.6 to $8.6 billion more than last year. If they do this, this will be the company's

01:19:10   largest year over year jump of all time, beating the $17 billion increase from 2013 to 2014 Q1.

01:19:17   So Wall Street is understandably freaking out over this because it's such a huge amount of money.

01:19:23   The record quarter for iPhone sales is $78.2 million. I wonder if they're going to beat that

01:19:31   to? I assume so, right? Like if you're gonna drive 5.6 to 8.6 billion dollars more revenue,

01:19:38   that's gotta come from iPhones, right?

01:19:43   Uh, primarily, right? But I think they would imagine that all their products will sell

01:19:49   better, but I think they're anticipating a huge number of iPhones sold. Eight. Because

01:19:53   the eight only was out for a short time in this quarter, in the past quarter. So most

01:19:58   of that is gonna be here and the iPhone 10

01:20:01   is gonna be in here.

01:20:02   So that's a huge part of it.

01:20:04   I should say, I'm not quite sure where that,

01:20:05   like the biggest jump thing comes from

01:20:09   because in holiday 14, they did 57 billion,

01:20:14   basically 58 billion.

01:20:15   - I got it from your uncle.

01:20:17   - They did 75.

01:20:18   Well, no, it's the biggest jump they've taken in a while,

01:20:21   not ever because the jump from 2014 to 2015 was enormous.

01:20:26   That was when the iPhone kind of went supersonic.

01:20:30   That like, they went from 58 billion to 75 billion.

01:20:35   - The same thing was the history then,

01:20:36   is a better way to say.

01:20:37   I misread.

01:20:39   - But the last three have been incremental.

01:20:41   Like the last three holiday quarters have been 74.6,

01:20:44   75.9, 78.4.

01:20:47   And so I think it would have been reasonable

01:20:49   for Wall Street to say,

01:20:50   okay, this is the new normal with Apple.

01:20:52   They'll hit 80.

01:20:53   And I think that's basically what they did.

01:20:54   Is they're like, yeah, it'll be 80.

01:20:56   And Apple's like, "Nope, it's gonna be between 84 and 87."

01:20:59   And the Wall Street's like, "Oh my God, what, what is, what?"

01:21:04   And presumably, you know, the stock went up

01:21:06   and all of those things too.

01:21:06   So it's quite a bold, a bold prediction on their part,

01:21:10   even though they admit they don't entirely know

01:21:12   what's gonna happen with the iPhone,

01:21:13   they're still confident enough.

01:21:15   And they generally hit in that range.

01:21:16   So I think where we will look at a 60, you know,

01:21:18   86, 87 billion revenue quarter, which is bananas, right?

01:21:23   And that's keeping in mind that four years ago,

01:21:26   their holiday quarter was 58 to be like 30 billion more.

01:21:31   - In a few years time, they may hit 100 per quarter.

01:21:37   - Oh yeah.

01:21:37   I mean, if you look at their holiday quarter revenue numbers

01:21:41   in what is it?

01:21:45   In the 2010 holiday quarter, it was 26.7.

01:21:52   - Oh God.

01:21:53   (laughing)

01:21:55   Wow.

01:21:56   Wow, that is wild.

01:21:57   - And so as we move to the end of the decade,

01:21:59   they're closing in on 90.

01:22:01   Yeah, this is one of those things where I post these charts

01:22:05   and people are like, yep, Apple's totally doomed.

01:22:07   Like again, Apple is not free from criticism

01:22:11   just 'cause it's making money.

01:22:14   And there are lots of people who criticize it

01:22:15   and rightly so in their products and strategies

01:22:18   all should be analyzed carefully.

01:22:20   No one can deny that Apple is just printing money at this point.

01:22:24   Just, it is a massively profitable and a huge revenue driver is just a huge company making

01:22:31   huge amounts of money.

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01:24:28   Let's wrap up today with some #AskUpgrade questions.

01:24:33   Meir asked, If Apple knew that the iPhone X supply could be limited, why did they include

01:24:39   more countries than usual on launch day. For example, India is usually not included, but

01:24:44   it was this time.

01:24:46   So I had some thoughts about this Jason. We were concerned and it does look like the supply

01:24:51   was maybe not as limited as we feared but still limited. So why if supply is limited

01:24:57   why include more countries? I expect it's because they want to show the same commitment

01:25:04   to their growing market in India as they did with China.

01:25:08   Apple want India to be their next big major market, so they should treat it as such.

01:25:12   And you show it respect, you show the market respect by giving them the device on day one,

01:25:17   right?

01:25:18   Yeah, I think so.

01:25:19   And I think this is one of the ways that Apple pushes itself, is Apple wants to roll out

01:25:23   internationally everywhere.

01:25:25   You see a lot of tech companies, they roll out in one country, or three countries, or

01:25:29   seven countries.

01:25:30   And Apple wants to keep expanding its day one rollout.

01:25:34   got a lot of work to do still but it is pushing it more and more every time. I

01:25:39   imagine they go into a new product launch and they say you know we're gonna

01:25:43   push you on how many of these you can make and we're gonna push you on

01:25:46   shipping them internationally and if they truly felt like there was no way

01:25:52   anyone was going to get them and it was gonna be a debacle they would have cut

01:25:55   back on the launch countries. I think you could have taken the number of launch

01:25:58   countries as a sign that Apple was pretty confident that they could ship

01:26:02   enough iPhone 10s to get close to demand and not have it be like a disaster where

01:26:08   they're turning people away who are going to not ever buy their phone. And

01:26:12   you're right, they're investing in those countries. Like China, it's super

01:26:14   important because there's definitely a perception that a lot of

01:26:18   iPhone sales in China are for, you know, appreciably different models. Like when

01:26:23   the iPhone changes a lot, when the 6 came out, there was a huge spike

01:26:27   in sales, and so there's anticipation that the 10 is going to be wildly

01:26:31   successful in China. And so you know they want to be there. But yeah, they said very

01:26:35   nice things on the analyst call about India and how encouraged they are and how that business

01:26:39   is growing. So they definitely want to give them some love too. So I think it's a combination

01:26:43   of them wanting to up their game in terms of pre-production of units and up their game

01:26:48   in terms of distribution in different countries. Because I think ideally Apple would ship phones

01:26:54   to every region on day one. I think that's what they really would like to do. And they

01:26:59   can't quite do that yet, but I think they want to get there.

01:27:02   And so they want to keep pushing on that front.

01:27:05   - So we have Vidit in the chat room, who's in India.

01:27:09   And Vidit is saying that supply is very low, right?

01:27:11   Like that they're not distributing it to all the

01:27:13   pre-sellers that they usually do, right?

01:27:15   Like that it is low.

01:27:16   I mean, it is low everywhere, of course, but like,

01:27:18   it is there, they're trying, right?

01:27:20   But yeah.

01:27:21   - Well, and I think Apple probably looks at the India market

01:27:23   and says, a phone that's $999 in the US,

01:27:27   like there is a very small, small section of the India market

01:27:32   that will pay that kind of money for an iPhone.

01:27:35   And so they can say that it's in India

01:27:37   and they can give some to their partners

01:27:39   who can sell them to their very best customers,

01:27:41   but they probably don't imagine that that's a huge drain

01:27:44   on the production line, right?

01:27:46   Because Apple's doing most of its India cultivation

01:27:49   at lower price points where it's more affordable

01:27:53   to middle-class people in India.

01:27:56   but why not put the iPhone X on the list

01:28:00   and let your partners there sell those

01:28:02   to their top-notch customers who will pay the most

01:28:06   for the latest and greatest.

01:28:08   So yeah, I think that's reasonable

01:28:10   that they're not anticipating it's gonna be a huge seller,

01:28:12   but they wanna have it available in that.

01:28:15   And then they can check it off and say,

01:28:16   yeah, we were in India day one.

01:28:17   - Tyler asked, "When the iPad eventually gets Face ID,

01:28:21   "do you think they keep the camera at the top

01:28:22   "or move it to the long side

01:28:24   where the thicker, longer bezel is. What do you think, Jason?

01:28:27   That's a good question. Apple has aggressively treated the iPad as this. I mean, like, the logo

01:28:35   on it suggests that they really think people use it in portrait orientation, but I use it mostly in

01:28:41   landscape. I realize that perhaps I'm an outlier there. No, no, no. Smart keyboard, right? Like,

01:28:47   they-- Apple look at it as both now, right? Like, they acknowledge the landscape.

01:28:53   I think that I think it's a I think it's a question of, you know, the the cameras in one place. I think

01:28:59   I don't think it matters. I think they will leave enough of a bezel that it won't necessarily have

01:29:03   a notch on the iPad, but they'll try to get it close to the edges much closer to the edges than

01:29:09   I mean, they've been doing that anyway. They could do a notch but they may not they may not

01:29:13   bother with that because they've got more room to play with. I think the real question is going to be

01:29:19   letting face ID camera and projector and dot projector and all of that do handle handle

01:29:26   both orientations.

01:29:27   Yeah, right. Because the iPhone doesn't right now you have to be portra--

01:29:31   And I don't think they're going to do two sets, right? They're not going to do two sets

01:29:33   of sensors. There'll be one set of sensors. So if I had to pick where it's going to be,

01:29:37   my guess is it'll be where it is now, which is at the top in portrait, but they're going

01:29:41   to need it to work in landscape.

01:29:43   They wouldn't need two, Jason, they'd need four. You'd need four cameras on it if it

01:29:47   only works in one orientation, right? Because you could be holding it upside down. And like,

01:29:53   depending on what landscape side, there's no specific landscape size, you'd need at

01:29:57   least three, maybe four cameras, it'd be wild. So I actually think now that Face ID on the

01:30:01   iPad is a little bit further away than I thought it would be. I thought maybe we'd get one

01:30:05   next year, but it might be further away than that. Like, the technology has to be better,

01:30:09   I guess, to be able to do it in multiple orientations, which they will, I expect, fix eventually.

01:30:16   that might not be immediately. We might still be waiting a little bit for that. Simon wants to know,

01:30:20   do you think that we will see any new iPhones coming out of Apple without face ID in them?

01:30:27   So next year will Apple sell a new iPhone that does not have face ID?

01:30:34   I think there will be a new iPhone SE that won't have face ID, right? And I think there will

01:30:38   probably be an iteration on the 8, like an 8S or something that will not have face ID.

01:30:43   I think we have one more year of non-10 phones, right, this design. I think we have one more year

01:30:50   of there being another iteration on the 687 line before we get to multiple of the new full-screen

01:30:59   phones. They like to keep the old models around, so those old models will have it, and they will

01:31:03   probably do some progression on the old models. I doubt that they'll just be like, "Here's the

01:31:06   iPhone 10.2, and the old iPhones are gone. You can just keep buying the 8." My gut feeling is that

01:31:13   that there will be an 8s and they'll keep kind of driving that forward. They may not.

01:31:17   They may just keep the 8 around and let it kick around for a while. The SE needs an update

01:31:22   though, so if I go by the fundamentals of this question I would say yes there will be

01:31:26   because I think there will be a new SE and it will still not be Face ID.

01:31:33   Myke asked, "Have you noticed any screen issues on the iPhone X like the Pixel 2 XL?"

01:31:39   I don't have the Pixel 2 XL, so I've only read reports about it.

01:31:44   I would say there is a slight color shift.

01:31:46   I didn't really see it at first, but if you look at the white screen and you tilt it a

01:31:50   little bit, it gets a little bit bluer, but it's super subtle.

01:31:54   My understanding is compared to most OLED screens, Apple's done a good job to kind of

01:31:57   like minimize it and have it be not like localized to part of the screen, but it's really kind

01:32:01   of the whole thing just makes it a little bit bluer, and that's just an OLED thing.

01:32:06   I haven't noticed anything beyond that.

01:32:09   have noticed that the auto brightness setting in the display settings has been moved to

01:32:16   accessibility it's really been hidden away and on the iPhone 10 it actually says if you

01:32:21   turn this off it may impact the life of your screen.

01:32:25   Oh wow.

01:32:27   Yeah and that's an example where Apple is trying very hard to get you to not change

01:32:34   that setting because it might have an impact. So yeah, you have to go to General, Accessibility,

01:32:41   Display, I think, and then Display Accommodations, Auto Brightness, and it says, "Turning off

01:32:52   auto brightness may affect battery life and long-term display performance." Right? So

01:32:59   Apple is doing a lot of stuff to deal with the fact that it's an OLED screen.

01:33:04   But right now it looks great. It looks beautiful. I love the contrast on it. I don't really watch a

01:33:10   lot of videos on my iPhone because I prefer my iPad and my iPad Pro can do HDR video too, so

01:33:16   that's pretty great. But it's something that bears watching, right? I mean, it is a first-generation

01:33:22   product, and even if it's great today, there could be issues that crop up over the next year or two

01:33:27   that we learn about that we just don't know because it's a new Apple product.

01:33:31   Yeah, I can't remember where I heard. Oh, this is in Neil A. Patel's full review. He said,

01:33:37   "All OLED screens have burn-in. It's just a case of how long."

01:33:41   Yeah, and what Apple does to try and subvert it and move things around, right? Because you can

01:33:48   try to avoid burn-in in a bunch of ways by changing what's on the screen. Like in the Notch, do they

01:33:56   try to vary what's in the notch so that it doesn't burn in, you know, the usual stuff that's in the

01:34:01   notch that it's all of these things. I'm sure that they're doing a lot of analysis and trying to do

01:34:06   what they can in software to mitigate this, but it isn't a lead screen. And yeah, there will probably

01:34:11   be a story in two or three years where somebody is like, Oh, I can't resell my iPhone 10 because it's

01:34:17   got some burn-in and that'll be new. But you know, by, by two years from now, it might also be like,

01:34:23   well, yep, that's what happens with these screens. So who knows? I mean, that's the truth of it is we

01:34:29   just don't know. Oh, I was going to say one thing I wanted to do a follow-up of somebody pointed out

01:34:35   in the chat room. I said the iPhone 8s, but it may be the iPhone 9 just to give us an iPhone 9

01:34:40   so it isn't just hanging out there. Like do an iPhone 9. It's like Mac OS 9. It's like, yep.

01:34:45   And this is the bridge and now we'll have a funeral for the iPhone 9.

01:34:51   And finally today Charlie wants to know can you send Animojis through other

01:34:55   apps other than iMessage maybe an app like WhatsApp. So Animoji is an iMessage

01:35:02   application right like it's not a standalone thing it is an app in iMessage

01:35:05   but when you send an Animoji it becomes it's a video file so you can tap it

01:35:10   you can save it you can share it in other places so a way you can do this

01:35:14   send them to yourself so just yep open up iMessage put in your email address

01:35:19   for your phone number, record the animoji, send it to yourself, once it's sent tap on

01:35:23   it, then you get the little share button so you can save it as a video to your camera

01:35:27   roll or you can share it to other applications. It's not ideal but it's a way to do it.

01:35:33   So there you go. And then you can send animoji, you can put them on Twitter, you can put them

01:35:37   on Slack, you can put them on WhatsApp, wherever you want, whatever you want to do, you can

01:35:39   put them anywhere. That's one of the great things about it is that you can do that because

01:35:44   Apple could have found a way to stop that and I'm pleased that they didn't because it's

01:35:47   allowed for an emoji karaoke right like that's because the fact that you can get them out

01:35:51   of iMessage as these video files. Alright so thanks so much for listening to this week's

01:35:56   episode if you want to find our show notes it's at relay.fm/upgrades/166 if you want

01:36:00   to get involved to the show you can ask us a question for the beginning with the hashtag

01:36:05   SnellTalk and that can open up the show with something fun something different to keep

01:36:09   us nice and varied at the beginning and if you have any questions you want us to answer

01:36:13   that are a bit more technological in nature, you can use the hashtag #AskUpgrade and we

01:36:18   close out the show with those. If you want to find Jason online he's @JSnell on twitter

01:36:23   and he's over at SixColors.com for all the great commentary that he does along with Dan

01:36:28   Moran and some other featured guests. I'm @imike, I M Y K E. Thanks again to Casper,

01:36:35   Encapsula and Eero for supporting this week's show and most of all thank you for listening

01:36:39   and we'll be back next time. Until then, say goodbye Jason Snell.

01:36:43   Goodbye everybody!

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