458: Weaving on a Thoughtful Basis


00:00:00   [Music]

00:00:08   From Relay FM, this is Upgrade, episode 458. Today's show is brought to you by ExpressVPN

00:00:16   and Uni Pizza Ovens. My name is Mike Curley and I'm joined by Jason Snell. Hi Jason.

00:00:20   Hi Mike.

00:00:21   We're like less than a month away now from WWDC.

00:00:26   I feel like it's all slotting into place. I don't know, there's something,

00:00:30   it's been all kind of amorphous up to now, but now suddenly I feel like, you know, it's, it's

00:00:36   next week we do this and next week we do that, yeah, week after we do this, and like it's,

00:00:40   it's all kind of forming now. It's more real now, I think. It's coming. Yeah. But,

00:00:46   tradition remains and I have a Snell Talk question for you. It comes from Ramona who wants to know,

00:00:52   "Jason, which are your favorite pizza toppings and do you like to eat pizza crust?"

00:00:56   Did we, have we not covered this?

00:00:59   Oh, of course we have, but like, what, you think everyone that's listening now has been listening

00:01:04   for the last five years? That's not how this works. People dip back into the archive for

00:01:10   the pizza supercut that we should make now about all of our conversations about pizza.

00:01:14   You could have changed, your topping choices could have changed.

00:01:19   People do change, but my pizza preferences remain the same.

00:01:23   Pepperoni's always been my favorite pizza topping.

00:01:26   Easy.

00:01:27   Yep.

00:01:27   Always. Always been. Which is funny because like my kids, especially my son, is like,

00:01:33   "Cheese pizza." He doesn't want any toppings on it at all, which I don't understand at all.

00:01:36   But as a kid, you know, really I think you're offered two kinds of pizza. It's a little more

00:01:43   sophisticated today, but back when I was a kid, there were two kinds of pizza. Cheese pizza and

00:01:48   pepperoni pizza. And you could order special of stuff, but like if you're getting something for

00:01:54   kids or you're just getting a slice, your choices are cheese or pepperoni. Those are the choices.

00:01:58   And I always liked the pepperoni. I thought that was great. So in college, you experiment as you

00:02:06   do, right? In college, it's a time in your young life when you're like, "Let's try new things. Let's

00:02:11   try different things. Put different things inside our bodies and see how it makes us feel."

00:02:17   Oh my God.

00:02:18   And for whatever reason, while working at the, just let it go, Mike, working at the college

00:02:23   newspaper, we would end up ordering pizza late because we were hungry and working all evening

00:02:29   on the newspaper until like the early hours of the morning. And it was out of there that,

00:02:34   and I don't know who ordered it or if I ordered it and thought it was a funny thing. I think somebody

00:02:39   must have ordered it and I just had it. Somebody had a pepperoni with pineapple on it. And again,

00:02:46   formative moments in my young life. I had the pepperoni with the pineapple. You got the salty,

00:02:53   slightly spicy pepperoni, and you got that sweet pineapple flavor.

00:02:59   The good texture of cooked pineapple too, I feel like.

00:03:02   Yes. I was a changed man, Mike. That was the end of it. So since then, pepperoni and pineapple,

00:03:07   which is funny because I did not, it wasn't like I had a Hawaiian pizza and said, "You know, this

00:03:12   Canadian bacon on here, this ham would be better if it was pineapple or if it was pepperoni."

00:03:19   That's not how I came to it. Maybe the person who ordered it came to it that way,

00:03:22   or maybe the Domino's pizza we ordered from did not have Canadian bacon. Regardless,

00:03:29   it became my favorite. So now that's what I get. I like other kinds of pizza though, I will say.

00:03:35   Barbecue chicken pizza is really good. I know that there's some people out there, John Siracusa, who

00:03:40   scoff at barbecue chicken pizza. I kind of love it. We were visiting Salt Lake City on our way to

00:03:47   the eclipse a few years ago. We did a road trip to Idaho to see the eclipse. And we ate at a,

00:03:54   it was like a underground pizza bar place that I think it was the summer, so there was not very

00:04:02   many people there, but I think University of Utah people go to there. So it's like a college pizza

00:04:07   place. And they had a barbecue chicken pizza with Gouda, with smoked Gouda on it, was maybe the best

00:04:16   pizza I've ever had. Like it was amazing. So runner up barbecue chicken pizza, and if you're in Salt

00:04:24   Lake City, find that college pizza dive, because oh my god, it was great. Do you eat the crust?

00:04:32   Crust strategy. Yeah, I like the crust. Depends on how much I'm eating.

00:04:37   If I'm ordering- It also depends on the quality of the pizza.

00:04:41   And yeah, sure, right. I mean, lousy crust is lousy. There are times when I will, like, we will

00:04:48   order a pizza and it's nice and hot now and we're probably not going to take it home, or it's like,

00:04:52   it's personal sized enough that whatever is left you're not going to take home, and I will then,

00:04:57   I will often prioritize the non-crust parts because it'll be like, well, I'm going to fill

00:05:03   up on crust and I'd rather have more of the cheese and sauce, please. So it varies. At home, Lauren

00:05:11   frequently doesn't eat the crust, and occasionally if it's a particularly good dough that I have made,

00:05:16   I will eat her crust because that's real good crust and I'm not going for another piece.

00:05:21   That's husband's prerogative, man. That's what you get.

00:05:23   Yeah, exactly. It's, I made that crust and now I take it back and I'm going to eat it.

00:05:27   So yeah, yeah, sure. Sometimes, sometimes not. If you're not, if I'm not hungry enough and I like

00:05:33   the cheese, the pizza itself is filling enough, then the crust is the first to go. I'll put it

00:05:39   that way. It's optional, but I do like it. Long time listeners will know that I have always been

00:05:45   a fan of pepperoni too, and you turn me on to the ways of pineapple pepperoni, which I think is the

00:05:49   perfect combo for a pizza. I will say the thing that has changed in my life is if, you know,

00:05:55   something like pineapple is not available to you, you want to try something different. Spicy honey

00:06:00   serves a lot of the like, the flavor balancing for pepperoni. So like pepperoni with like a spicy

00:06:06   honey, it's very good because it adds a bit of sweet and also adds a bit of spice. So I'll add

00:06:10   that in there too. Hot honey. A little hot honey. Yeah. The hot honey trend. It's very trendy,

00:06:14   the hot honey, but I get it. I get it. I love honey also. So that might be an interesting way

00:06:21   to do it. I'll, I'll keep that in mind. I don't know if I've seen a pizza place here that offers

00:06:25   hot honey as a, as an, I should say, I, I, I eat other kinds of pizzas. Like, I mean, I don't mind

00:06:30   mushrooms and I don't mind onions and I don't mind peppers and like, I don't mind other toppings,

00:06:38   but I'm never going to prioritize them. I'll have them, right? If like, well, we, we just got this

00:06:43   pizza that's mushroom and onion. I'll be like, okay, like fine. But I, I, I would not choose

00:06:49   that. If you are, you know, you're the pizza holder, you're gonna, you're gonna make the

00:06:53   decision. Plan a pepperoni. Right. Well, I mean, it depends. Yeah. Right. Do you get,

00:06:57   one of the beautiful things about pizza is in most settings, you choose what your pizza is,

00:07:01   right? It's only if you're like ordering a slice from a limited supply, or if you're like at an

00:07:06   event or something where they have pizza and it's already been pre-selected for you, for you, like

00:07:11   to choose the kinds and it's similar to having a slice where it's like, sorry, buddy, these are the

00:07:16   kinds of pizza we've got. Then, you know, you compromise. I would like to thank Roman for

00:07:22   sending in this question. It's a good question. I think it's Ramon according to the, uh,

00:07:25   our show document. I think you've said Ramona and Roman. No, I said, I said Ramon the first time and

00:07:31   it sounded like I, or Ramon, and it sounded like I added an A, but that was an unintentional sound

00:07:36   that my mouth made. Just to be clear, thank you Ramon. And also real time follow up from Dan

00:07:41   Morin reporting that the pepper, that he has a pizza place near him that has pepperoni and hot

00:07:46   honey. So it has penetrated into the United States. If it, you know, if it's not here already,

00:07:51   it will reach me soon. The first place I ever tried this combo was in Portland. Oh,

00:07:58   of course it was. Well, all right, then I'll just, I'll look for it. I'll keep an eye on it,

00:08:02   but if there's pineapple, I'm going to choose that instead. So thank you to Ramon for sending in.

00:08:07   I'm just covering all bases at this point, Jason. Okay. Uh, so sending in that question,

00:08:13   you can send it in a question of your own by going to upgradefeedback.com and send us a

00:08:17   Snell Talk question to open a future episode of the show. I have quite a bit of follow up today.

00:08:23   I have a lot of interesting things that people have written to us via the same feedback form.

00:08:27   Upgradefeedback.com. We love, we love it. We love it. I actually have some Snell Talk feedback.

00:08:32   David writes in and says 160 degrees? Four question marks. Four question marks. Does Jason

00:08:40   have heat shielding in his mouth? My Ember mug has a maximum temperature of 145 degrees.

00:08:46   Has Jason jailbroken his mug to allow hotter temperatures? What is happening here? So last

00:08:51   week's Snell Talk question, I asked Jason what his preferred temperature was for his tea,

00:08:56   and Jason said 160 degrees. Yes. I don't know about heat shielding. Is that what the,

00:09:02   is that what the inside of your mouth is not meant to be? Is heat shielding? 160 degrees for me is

00:09:06   fine. Um, it's a little bit on the hot side, but the thing is, uh, it doesn't stay there very long.

00:09:12   And I think David is right here. I didn't check, but I now have a memory of finding my ideal

00:09:19   temperature because the Ember mug prompted me to find it. And I found it. And then I found out that

00:09:24   the Ember mug doesn't go that high. So I set it to as high as the Ember mug goes. Right. So when I

00:09:30   serve myself at 160, what I'm basically getting is I can drink it then and it's really nice and

00:09:36   piping hot, but then the Ember mug won't let it go too far away from that. Whatever that high,

00:09:41   high point is, if it's 145 and it's not as good at 145 than it is at 160, but the Ember mug,

00:09:48   I mean, like I've got half a cup right now. And if I were not using the Ember mug,

00:09:52   it would probably be unpleasantly cool. And instead it's pretty warm. Yeah.

00:09:55   Joe wrote in and said, Jason asked if watchOS 10 widgets will update without the paired iPhone

00:10:03   in range. So the idea of if the widgets get added to the watch, uh, would we have to keep them

00:10:08   together to get that information? Right. Because that's an issue with some current watch stuff.

00:10:12   Joe said probably this will be the case because since watchOS 9 widget kit complications can make

00:10:22   network calls and update without an iPhone. So that was one of the things that changed when they

00:10:27   went from watch kit to widget kit. He says, and regarding stale complication data. So the

00:10:31   information being out of date widget kit complications vastly improve this because

00:10:36   they can make updates themselves. Clock kit complications relied on the app,

00:10:40   waking in the background to refresh, which would lead to stale data when it failed.

00:10:45   Widget kit has been a big improvement to watchOS and I look forward to see what's next.

00:10:49   Uh, I'm I just, uh, swipe to my watch and I, uh, am looking at the weather, which is coming from

00:10:58   carrot weather and what it is telling me, uh, there it did. Okay. It did update. I swiped over

00:11:04   from a different face and it did update. It was telling me the weather the last time that face

00:11:09   was on. And then after about 20 seconds it updated. So that's good. That's, that's not bad. That's,

00:11:16   that's what I want, right? Is I just wanted to make an effort to stay updated. So this is great news.

00:11:20   Um, that widget kit's already kind of doing this. And the idea, I mean, Apple has been trying very

00:11:25   hard to get the watch to stand alone and do things itself because that's what you want, right? You

00:11:29   want to be able to set up your watch using your iPhone if need be. And then if you've got the

00:11:33   cellular model walk away and still have everything work, that's the goal here. So I hope that, uh,

00:11:42   I hope it continues because I love having that stuff on there. And my biggest frustration with

00:11:47   my Apple watch is when stuff doesn't update, especially when those complications don't update.

00:11:51   It's very frustrating. Yeah. So I guess the hope would be that widget kit made a bunch of things

00:11:57   better, uh, just kind of a fundamental layer. And you would hope that if they're continuing to push

00:12:02   in that direction where it's like it's actual widgets now, maybe it would have gotten even

00:12:06   better, right? Like this is just like the pathway is towards more and more independent data gathering

00:12:13   from the watch and a more reliable update. Yeah. In fact, I think what we could probably say is

00:12:20   watchOS has been on a path in this direction, but it's, it's got, there's a bunch of sort of, uh,

00:12:27   technical debt or, or, or legacy tech technical stuff where there's stuff that's just kind of like

00:12:33   from back in the day, if not the original Apple watch from early in the Apple watch,

00:12:36   we're so dependent on the iPhone and new stuff is pushing the platform in this direction,

00:12:44   which I think is great. Like, again, this is, this is what I'm sure Apple wants to,

00:12:48   but the problem is you've got older apps and things kicking around in the system that, uh,

00:12:54   maybe preclude some of this. So when we look at reports that say watchOS 10 is going to be much

00:12:59   more widget forward, the encouraging way to look at that is by sweeping away the old stuff, but

00:13:07   really by bringing the new stuff front and center, you're also motivating every app developer to

00:13:13   update. And if all of those widgets are self updating and can reach out over the network and

00:13:19   pull their data and don't have to rely on their app, then the net result is going to be that

00:13:25   watchOS doesn't have to rely on the apps on the phone either. And the more of that, the better.

00:13:30   So, you know, I'm just, I'm just a little hesitant only because I've been using an Apple watch since

00:13:34   the beginning and it has been a painful process some of the time in terms of data, not getting,

00:13:40   you know, data getting stale on the watch, but I'm hopeful that this is going to, is going to do

00:13:43   that. I'm really, I mean, it's funny, Mike, you know, we go years where we're like, yeah,

00:13:47   and watchOS, I guess I'll get an update, whatever. And we spent the last few weeks really kind of

00:13:51   like nerding out on watchOS, but I think for good reason that this is really encouraging news of

00:13:57   a rethink of parts of watchOS and I can't wait to see it.

00:14:01   - And like, and I hope that all my expectation might be stuff like this might get better

00:14:05   because they don't, they're supporting more modern watches now, right? If they've been able to start

00:14:10   letting go some like the series three, for example, maybe there was some constraints with watchOS just

00:14:15   because of battery life concerns that like, if you're constantly refreshing information,

00:14:20   it's going to kill the battery, so. - Also widgetKit is something that should be

00:14:23   familiar to a lot of developers because they're also using it on iOS. And so that's another one

00:14:28   of those examples of Apple, again, they have to do it, right? Because they can't invent a new API

00:14:34   for everything. They really can. They have to like reuse things in different places, but it's also a

00:14:39   huge advantage because they'll be like, oh, widgets on Apple watch and everybody who's built widgets

00:14:44   on iOS should go, oh yeah, okay, great. - You already know how to do it.

00:14:46   - Yeah. - I've got a couple of pieces of anonymous

00:14:50   feedback, some tips, some tips from tips. - I was listening to Connected last weekend,

00:14:55   was surprised to discover that the Mike Hurley secret, double secret tip line had been established.

00:15:01   - And I have two more pieces of anonymous feedback via the Mike Hurley tip line.

00:15:06   You could just get in contact with me, find a way, you know, that's what these two people did,

00:15:12   enterprising individuals. - upgradefeedback.com will also work.

00:15:14   - It will also work and there is also possible to give anonymous feedback, but these people.

00:15:19   - Do we need to create like a signal account for the show? Can you even do that? I don't know if

00:15:23   you can. I think it's all good. - Well, the thing about these two

00:15:25   pieces of feedback is I know who these two people are, but they are submitting.

00:15:29   - Oh, I see. - You're keeping,

00:15:31   they're your anonymous sources. - They're my.

00:15:32   - None to you, but anonymous to us. - They're my informants.

00:15:34   - Okay, good. - So informant number one wrote in to say,

00:15:39   in regards to the journal app being closer in kind to Find My rather than, remember we were saying

00:15:45   about like, oh, it's not a social network, the journaling app, or it's more like in the Find My

00:15:50   department or something that Mike was talking about and talking about what capabilities it may

00:15:55   have. Your devices already track which people you have close by to you, regardless of whether you're

00:16:02   sharing Find My with them. This happens through a system called Rapport, R-A-P-P-O-R-T, Rapport.

00:16:09   - Yeah, it's French like. - Rapport.

00:16:12   The underlying protocol used for many things such as continuity, handoff, and airplay.

00:16:17   Currently, it can detect when a contact's device is nearby, but it doesn't do anything with that

00:16:22   information unless you activate AirDrop. It's completely local and relies on Bluetooth low

00:16:28   energy and/or Wi-Fi. And I confirmed with this person that this is how, you know, if you're in

00:16:33   somebody's home and you wanna get on their Wi-Fi and you get the Wi-Fi network password sharing,

00:16:38   it works through this rapport system. So the idea, you know, like we were talking about, well,

00:16:43   would I have to have all of my friends on Find My to see them in the journal app? In theory,

00:16:49   they could do this. So like, you know, maybe I'm not friends with Bob and Mary and Alex, right?

00:16:58   Like we're not in Find My together, but if we're hanging out, our phones will know that we were

00:17:03   together because we share contact information. So maybe that is a way that I would then be able to

00:17:09   add like, oh, I was with Bob and Mary and Alex today at the park to my journal. - And I would

00:17:13   assume that would end up being like an opt-in thing of like share your proximity information

00:17:19   with other people in your contacts list or something like that. - Well, maybe, but it's

00:17:23   already doing it and we didn't opt into it. - Well, yeah, but it's the logging part of it.

00:17:27   - Yeah, it's the logging part. - It would really require that, right? Because then it's,

00:17:31   then you're, I think that that would be how they would build it is like, you would say, yes, sure.

00:17:35   You know, you can share with Mike that I was near Mike when, you know, when we were near each other

00:17:41   and have it be okay. You wouldn't want that if you're like spying on somebody from behind a bush

00:17:45   or something. That would be less good. - This is one of those things where like, when I read,

00:17:48   I was like, oh, of course, right? This system, of course it works, right? 'Cause like,

00:17:52   how would airdrop from contacts only work? Like realistically, how does it do that? - Yeah, yeah.

00:17:58   You have to exchange with nearby devices and find the ones that are in your contacts. - Which is

00:18:02   fascinating this system exists and that it's all local. - Right, I wonder how that works. It must

00:18:09   be like that there's a unique, like a hash or something attached to every phone number or Apple

00:18:16   ID that it saves in your, maybe in your contacts. And then when it sees that it knows that that's a

00:18:24   recognized device or something like that. I wonder, I mean, it's gotta work that way, right? Because

00:18:31   you've gotta be able to see the devices around you and know what they are, even if they're not

00:18:35   in your, right? They're not known to you. - Yeah, I expect you are broadcasting your Apple ID

00:18:42   information and like maybe your phone number, right? Like outwardly. - It wouldn't be that

00:18:47   though. It would be like a hash of it or something. - Yeah, that's what I mean. I don't mean like so

00:18:51   clearly, but. - So when I add somebody to contacts, in the background, Apple is also downloading their

00:18:57   unique kind of like blurb thing that they send out. And then when it sees that it goes, oh,

00:19:02   I actually know that one. Interesting, I hadn't really thought about that, but yeah, they've

00:19:06   gotta be doing stuff like that. Anyway, that would be, sure. I mean, being able to log when you were

00:19:09   with friends and have it be kind of magical. Sorry, I guess that's a word Apple would probably use.

00:19:16   But the idea there that at the end of the day, where you spent the day with friends,

00:19:19   to have it say you were with Mike for four hours at this location, and then you can choose what

00:19:28   you wanna do with that. It's pretty cool. It's like your phone knows that already, but like,

00:19:32   do you want to write that down and have it be part of the record or not? That's fun. - 'Cause

00:19:39   for me, I feel like if they wanna make this a feature, they have to find a way to do it.

00:19:44   That doesn't mean that I have to become, find my friends with all of my friends. 'Cause I don't

00:19:48   think that's gonna take off, but this could be the building blocks of that. - And for people who

00:19:53   would accuse this of being an invasion of privacy, I would say when you're present around other

00:19:59   people, is it an invasion of privacy? You're all present around other people. - You've decided to

00:20:02   be together. - Exactly, so that the physical proximity is different. It's a log of your

00:20:08   physical proximity where you already were proximate. That's very different than, I'm

00:20:12   gonna make you a find my friend, and you're gonna see where I am forever, or until the end of the

00:20:20   day, or whatever, right? It's a very different kind of thing. You're opting in. I mean, I know

00:20:25   people can do bad behaviors here, but when you're in the same space as somebody, you know you're in

00:20:33   the same space as somebody. And so it's basically a public record, I would argue. So I don't think

00:20:38   it's that weird. In fact, yeah, the only way that this works is if you don't have to add everybody

00:20:43   to your find my roster or something like that. - Mike Hurley, Tip Line Informant number two says

00:20:49   about Keynote. So someone wrote in to ask if Apple uses Keynote for Keynotes. They wrote in to say,

00:20:57   yes, we do use Keynote for Keynotes, but it is just one stage in the pipeline. Marketing bring

00:21:02   their assets into the Keynote app. They arrange them the way that they want and export them as

00:21:07   a video. This is then pulled into Final Cut or whatever the video team is using. And occasionally,

00:21:14   the marketing team does still request new features that get added to Keynote so they can use them in

00:21:19   their presentations. So it is what we expected. - I like that we got this more or less right,

00:21:25   which is that they build it in Keynote and then they're doing an export because these final videos

00:21:29   are a whole production and the screen isn't there or what's on it isn't there. It has to be part of

00:21:37   the movie production workflow essentially for these videos that they do. But it starts life

00:21:43   in Keynote, which is cool that it still does that and that they still ask for new features in Keynote.

00:21:47   And that's one of the reasons Keynote is so good is because it really gets used by the people who

00:21:52   make the product. And that's good stuff. Love it. Thank you, secret informants to the Mike Hurley

00:22:01   tip line. Very exciting. - This one is not from my tip line. Ford CEO Jim Farley. Can you imagine?

00:22:08   He just hit me up. - Hi Mike. - Ford CEO Jim Farley has told Joanna Stern at the Wall Street Journal

00:22:16   that Ford is going to be sticking with car play. Farley says, "70% of our Ford customers in the

00:22:23   US are Apple customers. Why would I go to an Apple customer and say, 'Good luck.' In terms of content,

00:22:29   we kind of lost that battle 10 years ago. So like get real with it because you're not going to make

00:22:33   a ton of money on content inside of the vehicle. It's going to be safety, security, partial autonomy

00:22:39   and productivity in our eyes." - This is such a great statement. I mean, really you couldn't craft

00:22:45   a better statement from an auto executive who seems to actually be in touch with reality than this.

00:22:52   Whereas GM, I think, and we've made all these arguments before, is not in touch with reality.

00:22:58   And that's the part, two things I wanted to focus on here. One is why would I go to an Apple customer

00:23:04   and say, "Good luck." Right? It's so true, right? Which is you're used to having this thing, but

00:23:11   forget it. You don't get it now. We've decided you don't get it now. It is baffling when Apple

00:23:17   customers are such an important part of the new auto market in America. Like what? And then

00:23:24   the realism of, in terms of content, we lost that battle 10 years ago. To say what we've been saying,

00:23:30   which is really like, people love their smartphones and their smartphones are up to date

00:23:35   and they've got their stuff on it. And their stuff, it comes from all sorts of different sources. And

00:23:39   like, don't get between me and my smartphone, between me and my stuff. And then he says,

00:23:44   quite rightly, "Okay, one, you're not going to make a ton of money on content inside the vehicle."

00:23:48   I think there's a level of realism there that GM doesn't share. GM with its history, with things

00:23:53   like OnStar, it's like, no, no, no, no, no. We offer them services and we charge them and we

00:23:58   get them on an annual plan and we make it impossible to cancel it. And we get in with the

00:24:03   insurance companies to say, give them a break when they pay for our services, which is a thing they

00:24:08   do, by the way, with OnStar is that they have like a deal where if you have OnStar and you're

00:24:14   sending all your safety information back to GM, your insurance company will give you a break on

00:24:20   your insurance because they're looking at the data coming from your car. It's bananas, right?

00:24:25   So like, I think maybe company culture-wise, GM just isn't there. The GM really does think

00:24:32   that they've got to be making a ton of money on content inside the vehicle. And I think Ford looks

00:24:38   at this and says, nah, it's not going to happen. And I think it's more realistic that it's not

00:24:42   going to happen. And yet, second, it's going to be safety, security, partial autonomy, and

00:24:47   productivity. The stuff that needs to be on the car will be on the car. And then carplay is for

00:24:51   the other stuff. And that is a really reasonable split to me. The idea that your car stuff is in

00:24:58   the car and your entertainment stuff is on your phone and the best car interfaces are going to

00:25:06   have places for both, right? Which is what carplay already does, where there's a little entertainment

00:25:12   spot and then wrapped around it is the car stuff. And I think that's perfectly reasonable. It's

00:25:17   refreshing and a little shocking that it's so reasonable from a car industry CEO. It's amazing.

00:25:25   This isn't really follow-up, but I'm just going to put it in follow-up anyway. Apple have launched

00:25:31   20 new games for Apple Arcade, and there are some bangers in here. And I just wanted to let people

00:25:37   know about some of these games. So they've done what they've done before, where they've added a

00:25:41   bunch of existing hits. Games like Limbo and Temple Run get the plus treatment, right? Limbo Plus,

00:25:48   Temple Run Plus. They take old hit games, remove all that purchase from them, make them compatible

00:25:54   for all devices that are currently running, and put them on Apple Arcade. I think this is just

00:25:59   like a fantastic way to bolster the service and you build a foundation. There's a bunch of just

00:26:04   really good games in here. I'm just scoring through the press release now. Just a ton of

00:26:09   classics that are in here. They've got, like I said, Limbo already, Hill Climb Racing, Getting

00:26:14   Over It, Farming Simulator is in there, if that's your kind of thing. So there's a bunch of stuff

00:26:19   there, but there's also new games. They've added a few, but I wanted to recommend two that I've

00:26:24   started playing and really enjoying. One is Disney Spellstruck. It's just Disney Scrabble.

00:26:29   Ah.

00:26:30   And it's just good. It's like a good Scrabble game. And as you're playing it, it's like with

00:26:36   a lot of these games, you can see where it was supposed to be in an in-app purchase focused game.

00:26:41   But then Apple were like, "Hey, why don't you put it on Apple Arcade?"

00:26:46   Because you can get these power-ups to help you out and they just randomly give them to you.

00:26:52   That's not how it is supposed to go. I was supposed to buy those, but it's great.

00:26:56   The other one is What the Car, which comes from the same people who made What the Golf.

00:27:01   Oh, man.

00:27:02   And it is equally excellent. And I'm going to make a prediction here.

00:27:06   This could probably be a draft prediction, but I'm just going to say it now.

00:27:10   The game company behind What the Golf and What the Car have made a VR game called What the Bat.

00:27:17   And it's available on Oculus and...

00:27:21   Oh.

00:27:21   Like on Quest, sorry. And it's available on PlayStation.

00:27:24   100% it's going to come to this device because it doesn't...

00:27:29   This is a game that would work perfectly with hand tracking. Your hands are bats and you just

00:27:33   have to just do things. You're just smashing things. So this team, this company clearly has

00:27:40   a good relationship with Apple, right? Because this is now two games that have come to...

00:27:46   It's arcade.

00:27:47   Apple Arcade. And their third game is a VR game and Apple doesn't have anywhere for that right

00:27:52   now. And I'm convinced it's going to come to Apple Arcade when games get added to the headset.

00:27:58   I'm frightened to try Cityscape's Sim Builder.

00:28:01   Ask my next one to try too.

00:28:03   Because I loved Sim City so much. And I'm concerned that I will be swallowed whole by

00:28:11   Cityscape's Sim Builder. But I mean, if this is the last you hear from me, know that I was

00:28:18   doing what I love, which is apparently playing Cityscape's Sim Builder.

00:28:22   If you try out What the Car and enjoy it, then I recommend you give What the Bat a go to.

00:28:31   You haven't been to Quest 2, right?

00:28:32   I mean, I love What the Golf. I love What the Golf. It was great. I played the whole thing.

00:28:35   What the Car is incredibly absurd. I think it actually might be more absurd than What the Golf.

00:28:40   So it's hard to believe.

00:28:43   Yeah, it is cool.

00:28:44   Great.

00:28:45   And there's a lot of the game.

00:28:47   So Mike, I'm still wasting all of my spare time playing Marvel Snap because of you.

00:28:53   So thanks a lot for ruining my life.

00:28:55   Oh really? I fell off Snap.

00:28:55   Anytime.

00:28:56   Oh God.

00:28:57   Anytime.

00:28:57   It's it's uh, yeah. Yep. Yep.

00:29:01   We also wanted to remind the Upgradients that we do have a selection of on-demand

00:29:07   t-shirts always available that you can get at upgradeyourwardrobe.com.

00:29:12   This is probably a really good time to pick up your draft shirt.

00:29:15   We have the WWDC draft coming up pretty soon.

00:29:18   You can get yourself the upgrade draft t-shirt or hoodie.

00:29:21   Sorry, t-shirt or sweatshirt or tank top or onesie.

00:29:25   If you want to draft your baby, you could do that.

00:29:29   So you can go ahead and check those out.

00:29:31   We do have sweatshirts and hoodies, sweatshirts and hoodies.

00:29:34   You can get both.

00:29:36   And that also we have some upgrade logo tees available there and a Rumor Roundup t-shirt,

00:29:43   which I am wearing today, which is one of my very favorites.

00:29:45   It is just the Lasso Rumor Roundup.

00:29:48   So is that upgradeyourwardrobe.com.

00:29:52   You can go and check those out and there'll be a link in the show notes.

00:29:55   If you want to go and buy yourself a very cool upgrade t-shirt.

00:29:58   This episode is brought to you by our friends at Ooni Pizza Ovens.

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00:31:20   Jason, we were talking about pizza a lot at the beginning of the episode.

00:31:23   I know this is how you make yours.

00:31:25   Yeah, well, actually what I was going to say is I am very excited that the weather, well,

00:31:30   actually we're having a little cold and rainy weather now, even though it's May.

00:31:34   What I do is the Ooni goes into hibernation during the cold time,

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00:31:47   although I can make a decent pizza in my oven, the fact is my oven goes up to whatever,

00:31:52   500, 550 Fahrenheit and the Ooni pizza oven, you get it up to like 700.

00:31:57   It comes with its own pizza stone.

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00:32:08   And then that super hot at the top is going to melt the cheese and make everything a little

00:32:14   bit burny and a little bit crispy, which is what you want.

00:32:17   That's what the wood fired fancy ovens do is they get that hot.

00:32:22   At a level that you're conventional, not in the sense of electric, but whether it's electric

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00:33:29   Money, money, money, money, money, money, money, money, money.

00:33:33   Money!

00:33:34   It's money time.

00:33:35   It's money time.

00:33:37   It's money!

00:33:37   Ching!

00:33:38   Ching!

00:33:39   It's Apple's Q2 2023 results.

00:33:44   Let me give you some headlines and we'll dig into it.

00:33:48   Okay.

00:33:49   Revenue, $94.8 billion, down 3% year over year.

00:33:55   This is the second largest Q2 in Apple's history.

00:33:58   Obviously, you have the clues here to work out which was the largest.

00:34:02   Profit was at $24.2 billion.

00:34:06   That was down from $25 billion year over year.

00:34:08   So my initial read on that is like margins was good though, right?

00:34:13   Like the drop in profit is not the same as the drop in revenue.

00:34:18   Um, iPhone, $51.3 billion up 2% year over year.

00:34:23   This was a Q2 record for the iPhone.

00:34:26   My question to you here was, do you think that this is the result of some sales being

00:34:33   pushed on from shortages in previous quarters that we had?

00:34:37   So like there was, there was some supply chain stuff, right?

00:34:40   Do you think this may have been a push through?

00:34:41   Yeah.

00:34:42   It's possible.

00:34:43   I mean, they were correcting it, but they, they did suffer in the holiday quarter for

00:34:47   having problems with the pro phones.

00:34:49   So it's possible that that's what it is.

00:34:51   It's not, I mean, it's basically flat, but in a quarter where everything else was

00:34:55   down, that the iPhone was able to do this, I think it's Apple's most important product.

00:34:59   So having them be able to do this, um, I think that you have to look into the past

00:35:05   for trying to understand all of these results, but for the iPhone, I'm not sure

00:35:10   how much of this is retrieved from out of the past quarter shortages or whether it

00:35:15   really is just that they, you know, soldiered on and yeah.

00:35:19   So maybe the 2% is just, it's up a little bit for that, but I don't know.

00:35:23   I don't think it was a huge thing.

00:35:24   Cause I think that they started to get into balance by the end of last quarter.

00:35:27   Yeah.

00:35:28   Okay.

00:35:28   Oh, by the way, I just wanted to note that the change in profit is actually about

00:35:34   the same as roughly 3%.

00:35:37   So it's, yeah, it is about the same.

00:35:39   So I think margins were, were, although they, they report their margins.

00:35:42   I don't actually know what the margins are, but they were, they were probably

00:35:44   pretty similar.

00:35:45   Appreciate the clarification.

00:35:46   The Mac was at $7.2 billion down 31% year over year, making it the lowest quarter

00:35:56   since 2020.

00:35:57   Uh, very tough compare the iPad $6.7 billion down 13% year over year.

00:36:05   So just flip those numbers 31 to 13.

00:36:08   Also the lowest quarter since 2020 services is a 20.9 billion, which is up

00:36:13   5% year over year.

00:36:15   It's also growth in the previous quarter, which.

00:36:17   Yep.

00:36:18   Uh, earlier in the year, late last year that had started to dip, right?

00:36:21   Like there was something that I was talking about a lot.

00:36:23   Was wondering what was going on there, but it seems like they're growing back

00:36:25   again.

00:36:26   Wearables home and accessories is at $8.8 billion down 1% year over year.

00:36:33   Yeah, essentially flat.

00:36:35   The Mac and iPad being way down.

00:36:37   I think the only way like the Mac and the iPad have both been running at the

00:36:42   high and I don't look at this and say, ah, now people have turned against the Mac

00:36:48   and the iPad.

00:36:49   Cause remember it's, it's changes in, in growth compared and sales compared to

00:36:54   last year.

00:36:55   It is at a high level, but not what it was last year.

00:36:59   I feel like, like I have nothing in my heart that says, oh no, people are

00:37:04   turning against the Mac and the iPad.

00:37:05   I just don't.

00:37:06   It's very clear to look at the history here and say, what happened is one, the

00:37:11   pandemic, which sold a lot of computers and iPads because people were in

00:37:16   lockdown and they're like, and they're and work adapted and they're like, oh

00:37:20   geez, we need another computer at home or we need another tablet at home, or we

00:37:24   need to update the old thing.

00:37:25   And, and that drove sales.

00:37:27   And that's one reason that the iPad and the Mac have done so well over the last

00:37:31   couple of years.

00:37:32   And that that's tailed off.

00:37:33   Now I think that there's some truth in that, that the buying cycle was kind of

00:37:36   short-circuited and now it needs to reset.

00:37:39   And so you're going to have that, that a place where it's, I think the way that

00:37:43   they often describe it metaphorically is that the sales were pulled forward

00:37:47   essentially, right?

00:37:48   That you took your, your three years of sales and it all went in the first year

00:37:52   and a half.

00:37:52   And I think that there's truth in that.

00:37:55   And then for the Mac, you also had the arrival of Apple Silicon and there was a

00:37:59   lot of pent up demand for Apple Silicon.

00:38:01   Plus those M1 Macs, especially the reviews were so spectacularly good because

00:38:08   they are spectacularly good.

00:38:09   And a lot of people bought them and it drove a lot of sales in addition to the

00:38:12   fact that there were pandemic changes in how we all worked.

00:38:15   And so the Mac, I think has benefited from that twice, but you know, the M2

00:38:23   again, nothing wrong with the M2, but if everybody who was waiting to buy a

00:38:27   MacBook Pro waited for the M1 MacBook Pro to come out, then you're going to

00:38:32   sell a lot of them.

00:38:33   And then the next year they come out with the M2 and it's like, well, but so

00:38:36   many people already bought the M1, so they're not going to buy the M2.

00:38:39   And that was a high number.

00:38:41   You know, you do the math and it's like, well, yeah, this is what you're going

00:38:44   to see.

00:38:44   It's going to go down because everybody was really excited about it.

00:38:48   I think the Mac, like, if you look at the average Mac sale, like the Mac has

00:38:52   never been stronger.

00:38:53   Um, I think it, it will continue to be strong.

00:38:56   I think this is an issue where they just have to deal with the fact that they're

00:39:01   not going to reach those heights for a little while, and they're going to have

00:39:04   to wait for the buying cycle to catch up with them.

00:39:07   So David in the live chat, just go, which you can get access to.

00:39:11   If you're a member, go to get upgrade plus.com and you can find out more

00:39:14   about them has said, the narrative is strange to me.

00:39:17   Apple had lots of success.

00:39:19   Now that makes them look bad.

00:39:20   The problem with Wall Street, which is what a lot of this is, right.

00:39:24   They look at whatever you're doing now and they're betting on it being a

00:39:28   trend, right?

00:39:29   Like, right.

00:39:30   Cause you sell loads of Macs.

00:39:31   Cause it's all priced into the stock.

00:39:32   Exactly.

00:39:32   You sell loads of Macs.

00:39:34   If you keep doing this, we will continue to be confident in your business to this

00:39:39   level.

00:39:39   But if it changes, it's going to go down.

00:39:41   Like, right.

00:39:42   They want to see growth.

00:39:44   They always want to see growth and we can debate whether that's right or wrong,

00:39:47   whether that's corrosive to have businesses are run spoiler alert for my

00:39:51   opinion.

00:39:52   Yes, it is corrosive.

00:39:54   Uh, but that's how it works.

00:39:56   And um, and it's the same thing I always tell people like when they're like, oh,

00:39:59   Apple released results and they made all this money and their stock went down.

00:40:01   Why is that?

00:40:02   And the answer is because the expectation is priced into the stock.

00:40:06   Apple, as we expect it is priced into the stock.

00:40:09   The stock price is what it is because of everything we expect for Apple.

00:40:12   So then it becomes what happens next.

00:40:14   And if you give them, if they get growth, then that increases the future value of

00:40:19   Apple.

00:40:19   That increases everybody's estimation and the stock goes up.

00:40:22   And if you say, oh, Apple's going to be flat for a while in the doldrums, then

00:40:26   the stock will stay steady or go down, which is bad for investors.

00:40:29   Doesn't necessarily mean it's bad for Apple as a business if it's throwing off

00:40:32   all this profit and it's generating, uh, it's doing stock buybacks and it's

00:40:36   generating dividends for its investors, which it is doing.

00:40:40   And that's what, if you're a company that makes enormous profits and you're

00:40:44   looking at your growth and saying, our growth is probably going to slow because

00:40:47   we've been so successful for so long.

00:40:49   This is what you do.

00:40:50   And they identified this, like, I don't know, five, six, seven years ago, and

00:40:54   just started buying back stock and doing dividends and giving, essentially

00:41:00   giving money back to the shareholders because, uh, that's how you kind of

00:41:04   counteract some of that fear of flatness is by saying, yes, but we're very

00:41:10   profitable and you get to share in the profits.

00:41:12   And so they've been doing a lot of that too.

00:41:13   Tim Cook introduced a new catchphrase, the parade of horribles as a way to

00:41:21   describe our current socioeconomic climate.

00:41:25   Yeah, he's used a bunch.

00:41:26   This is, this is apparently something that is out there.

00:41:28   This is, this is a, a phrasing somebody told me that, that you've seen in other

00:41:32   places, but Tim Cook has adopted it, which I find funny just because it was,

00:41:37   uh, last year we had the cocktail of headwinds, which I thought had a little

00:41:40   panache to it.

00:41:41   The cocktail of headwinds served to you by, uh, Luca Maestri, the CFO.

00:41:46   And he, he, it's a, probably an Italian cocktail of some sort, um, full of headwinds.

00:41:52   Maybe those are bubbles.

00:41:53   I don't know.

00:41:53   Um, but the parade of horribles, I think it actually sounds kind of Willy Wonka

00:41:57   like, right?

00:41:58   Like, oh, there's a bunch of horrible, strange monsters that are coming down.

00:42:02   But anyway, uh, Cook used it to say, uh, that, uh, yeah, there's bad stuff out

00:42:08   there, but we're fine.

00:42:09   Essentially.

00:42:10   He was like, we have the luxury box at the parade of horribles.

00:42:13   So, um, I think that that shows you how Apple has kind of gone from it saying,

00:42:19   you know, things are bad out there and we're worried and we're concerned and

00:42:22   we're trying to do what we can to being like, things are bad out there, but we've

00:42:26   been fine.

00:42:27   And so we're fine.

00:42:27   And that is again, like we see this covering Apple like we do and looking to

00:42:35   the wider technology industry, they're in a very different position.

00:42:39   And like, you know, we, we have a lot of, you know, many, many times over the

00:42:44   years, we've spoken about the idea of like, why do they just sit on this cash?

00:42:48   Like, what are they doing with it?

00:42:50   Well, it probably helps them in times where all of their, um, colleague

00:42:56   companies in the industry are laying people off their front and center and

00:42:59   Apple's not doing that because they have so much money.

00:43:02   Yeah.

00:43:03   I mean, that's, that's the truth of it.

00:43:04   And I said this during the, um, during 2020, let's just say, we'll put it that

00:43:10   way.

00:43:10   Uh, I said, Apple actually looks a little embarrassed because they're doing so

00:43:15   well when the world is so terrible.

00:43:17   Yeah.

00:43:17   I feel like we're coming out of it now where they're like, yep, we we've

00:43:21   survived.

00:43:22   We did it.

00:43:22   Um, and we know that bad things have happened, but we, we, we feel like we're

00:43:26   in a good, a good place and not gloating about it or anything, but they're able

00:43:29   to say now, I think maybe with a little more confidence than they could back

00:43:32   then, just cause they, everything was all messed up saying, you know, we're

00:43:37   actually in a pretty good place right now.

00:43:39   Now, of course, a down quarter is just the time when you need the CEO to say,

00:43:43   we feel pretty good, right?

00:43:44   Cause you want to make everybody feel good, but I, unless you are literally a

00:43:49   bear.

00:43:49   Investor who is out to get Apple because you want them to tank.

00:43:53   I don't know how you look at Apple's last few years and, and not rationally

00:43:58   understand the place that this business is in, especially as we've talked about

00:44:02   many times before the mega cycle of the iPhone, because the iPhone more than

00:44:06   half the revenue.

00:44:07   And we know that the iPhone buying cycle is very visible because they do major

00:44:11   revisions to the iPhone and it kicks sales.

00:44:13   And that happens every three years ish.

00:44:15   We'll see what happens this fall because whatever that iPhone is, this is when

00:44:19   we might expect a new iPhone that will drive sales unclear, whether they're

00:44:23   going to keep that strategy or whether they're going to kind of split up the

00:44:28   new look iPhone into multiple releases over multiple years in multiple iPhone

00:44:32   levels, right?

00:44:33   Cause they've got more iPhones that they sell now different models, but yeah,

00:44:38   hard, hard not to look at Apple's last few years and say, first off, you

00:44:41   wouldn't even tell that there was a, you know, just a series of terrible

00:44:45   economic conditions as well as a global pandemic.

00:44:49   And that their factories got shut down.

00:44:52   Like you couldn't even really tell.

00:44:54   And that they're in a pretty strong position here, but you know,

00:44:58   if I were a wall street investor and I was worried about where Apple was

00:45:00   going in the future and where their stock was going, I would obviously be

00:45:03   concerned about is the iPhone going to plateau, in which case they're an

00:45:07   incredibly profitable company, but they're not growing anymore.

00:45:10   Or growing very slowly, or are they going to have another kick?

00:45:14   You know, can the Mac be taken up a notch?

00:45:17   Can the iPhone still be taken up a notch?

00:45:19   Can the iPad still be taken up a notch?

00:45:21   And I think that there that's an open question there, which is why they

00:45:25   started talking a lot more about emerging markets, I think this time,

00:45:28   where they did better, Apple actually did better in emerging markets than

00:45:31   they did in their existing established markets.

00:45:34   And that's, that's a message that they want to send because they want to

00:45:37   say, look, this is where the next growth spurt is going to come from.

00:45:40   Especially when one of those emerging markets is as big as India, which is

00:45:44   what they're talking about.

00:45:45   I spent a lot of time talking about India.

00:45:47   They saw some, they saw double digit sales growth in the region.

00:45:52   Tim Cook says India is a major focus for the company and said, and I'll

00:45:57   read a quote from Tim.

00:45:59   There are a lot of people coming into the middle class, and I really feel

00:46:02   that India is at a tipping point and it's great to be there.

00:46:06   And I will now read a quote from Jason's Macworld article where Jason

00:46:10   says, if this sounds familiar, it's because Cook said a lot of very

00:46:13   similar things about China a decade ago.

00:46:17   But when asked specifically to compare the potential in India to that in

00:46:20   China of the past, Cook demurred a politically wise decision and said, I

00:46:25   think each country is different and has its own journey.

00:46:27   That emerging middle class line, I felt like I have massive flashbacks

00:46:33   like to reading that.

00:46:34   Cause that was what they said for years about China.

00:46:36   Yeah.

00:46:37   Yeah.

00:46:37   No, it's exactly the same words.

00:46:38   And then when pressed to sort of like say, can you draw a parallel

00:46:41   between China and India?

00:46:42   He's like, no, no, no, no, no, no.

00:46:43   We'll never do that.

00:46:44   Don't ever ask me again.

00:46:45   No, no, no.

00:46:46   And it's like, well, first off China and India don't really like each other.

00:46:48   And they've got this thing where they're trying to diversify outside

00:46:51   of China, including into India.

00:46:53   And the last thing China wants to hear is Apple say, yeah, India is the

00:46:56   next China, right?

00:46:57   Like that you know, no, no, no, no, no.

00:46:59   So instead he's like, everybody's on their journey together, but it's

00:47:02   very hard not to see the parallels there where Apple is saying that in

00:47:07   lots of, uh, lots of emerging markets.

00:47:09   And they mentioned a bunch of them that Apple did really well, like set

00:47:13   records in the last quarter.

00:47:15   So that's what their message is.

00:47:18   Now, what are the size of those markets?

00:47:20   What's the potential of those markets?

00:47:22   Is it just trying to get out some happy news for investors?

00:47:25   Uh, when the truth is that those markets are relatively small, but it

00:47:28   seems like India and I would say Tim Cook's visit to India right before

00:47:32   this cannot have been a coincidence, right?

00:47:35   Like this is all about making the narrative about Apple right now about

00:47:39   potential future growth.

00:47:40   It's kind of brilliant, assuming that this is all sort of part of a bigger

00:47:43   plan that Apple going to India.

00:47:46   It's about future growth and diversification.

00:47:49   Um, I wonder what message it does send to China, but, um, Apple and

00:47:54   China are pretty tight.

00:47:55   So it's probably, you know, they, they, China knows what Apple's doing,

00:47:59   but I think Apple's not abandoning China.

00:48:01   It's just diversifying.

00:48:02   And that's the message they're sending is we want to be in China, but we're

00:48:05   going to be in other places too.

00:48:06   And yeah, for, if you're an investor and you look at India and you say,

00:48:10   wow, if India's middle-class can skyrocket like China's can, all those

00:48:14   people are Apple buyers.

00:48:16   And, uh, imagine another market like China's market, uh, where Apple can

00:48:22   come in and has very little market share.

00:48:25   And so there's enormous growth opportunity just by definition.

00:48:28   So we were talking about, you know, looking at the overall product lines

00:48:33   and you've got the Mac and the iPad are down, but the level, like, you know,

00:48:38   when we're talking about like the iPhone as a, as a thing, if the iPhone

00:48:41   starts to decline, like this quarter was saved by the fact that the iPhone

00:48:45   was up a little bit and services were up a little bit, but it was mostly

00:48:49   because the iPhone was up a little bit.

00:48:51   So this idea of if the iPhone did start to significantly decline, like we

00:48:55   started to see consistent decline, then the company's overall revenue

00:49:00   declines just because, right?

00:49:02   Again, what was it?

00:49:03   54% of the revenue in the quarter was the iPhone.

00:49:07   Like that's what people were looking for.

00:49:09   So what, you know, Apple one is to sell iPhones in India and whatever

00:49:14   it's going to take to do that.

00:49:15   So Savra in the discord is a listener who's in India and they're like, well,

00:49:19   the prices are going to change.

00:49:21   And I can, we've heard of this before of like, and it's one of the reasons

00:49:24   Apple's continued to push on the SE and had devices that were more price

00:49:29   focused.

00:49:30   And so my expectation is if Apple really does consider India to be this

00:49:35   growth market, the overall pricing strategy of the iPhone may have to

00:49:40   change to accommodate that.

00:49:42   But we'll see.

00:49:44   Yeah.

00:49:45   Whether it's the iPhone SE or whether it's bringing down the price.

00:49:49   I mean, they do have this freedom now, which they have not exercised, but

00:49:53   this freedom with the iPhone and the iPhone pro split to make that iPhone

00:50:00   more affordable than it's been.

00:50:01   And what they've really done is sort of make it not really more affordable

00:50:05   than it's been, but that the pro one is really expensive, but it does give

00:50:09   them the ability to say, look, iPhone, whatever number and sell that into

00:50:13   markets that are not seriously going to consider the iPhone pro, but the

00:50:16   SE is the other way in there.

00:50:18   And again, I I've been hearing for, you know, more than a decade now from

00:50:23   people in India who are like Apple is kidding itself because the prices

00:50:26   are just bananas and it doesn't make sense and they're hard to get and all

00:50:29   that and like, sounds, sounds like Apple is, is focused on India now to a

00:50:34   certain extent.

00:50:35   So they're going to have to find a way to figure it out.

00:50:37   Right.

00:50:37   I doubt that they're delusional about what they're going to do, but what,

00:50:42   what is that strategy going to be?

00:50:44   And I don't know.

00:50:45   I mean, I will also say though, there was, there was a time when Apple

00:50:48   trying to sell iPhones in China or computers in China was seen as a

00:50:52   bananas kind of decision where it's like, you're not gonna, you're not

00:50:56   going to do that, like you're, you're, you're so expensive and this market

00:51:02   can't handle it.

00:51:03   And what happened in China is that the market changed and grew and it

00:51:09   embraced Apple.

00:51:10   And a lot of those people who now had way more money than they used to have

00:51:14   spent some of it on Apple products.

00:51:16   So I don't, that's where I think maybe the parallel is going to break down

00:51:21   with India.

00:51:22   But again, I'm sure Apple is paying more attention to it and some of the

00:51:26   clueless decisions they've made in the past about India are probably going

00:51:30   to change because it's got, you know, more senior.

00:51:35   I mean, I've heard this before, like there's some people who are involved

00:51:38   in Apple in certain countries where like nobody cares.

00:51:41   And so they just sort of drift off and do their own thing.

00:51:43   And then if Apple execs suddenly are like, no, this is a key market for

00:51:48   us.

00:51:48   Everything changes.

00:51:49   Right.

00:51:49   And so I would imagine that that's going on with India now.

00:51:52   Yeah.

00:51:52   If pricing has to change, they'll change the pricing.

00:51:55   If that's what they think will grow the iPhone.

00:51:57   Like we are where we are now with the iPhone being what it is partly almost

00:52:04   because of the China market.

00:52:07   Right.

00:52:08   So huge.

00:52:09   And so if they can add another one of those, be very happy.

00:52:12   I'm reading again from your article Macworld.

00:52:15   It's become clear that the Mac and iPad are victims of their own recent

00:52:19   success, at least when it comes to sales trends.

00:52:21   Both products sold well during the early days of the pandemic and the Mac

00:52:25   also got a huge sales boost due to the arrival of Apple Silicon.

00:52:28   Yeah.

00:52:29   I think we already covered this.

00:52:31   Yeah.

00:52:31   But it's just like, I think it's just a nice way of summing it up of like,

00:52:35   well, thank you.

00:52:36   They are, it's hard to, it's that tough compare that we would talk about.

00:52:41   There was a big boost and now we're back down to a more settled level, but

00:52:45   that settled level was higher than they were before.

00:52:47   It's higher.

00:52:47   That's it.

00:52:48   I mean, that's the, that's the story with Apple in the last decade is they

00:52:52   get these huge growth spurts followed by a year or two where there's not a

00:52:56   lot of growth and everybody rings their hands about it.

00:52:59   But if you look at the numbers, you can see huge growth spurt followed by

00:53:04   flat is establishing a whole new level for the product.

00:53:08   And Apple has been really good at doing that.

00:53:10   What you don't want to see is the huge growth spurt, and then it goes back

00:53:13   to where it was, but Apple has never, well, has recent times Apple has not

00:53:18   done that.

00:53:19   Every time that these growth surges have happened, they've, they've reset

00:53:23   the bar.

00:53:24   There's been a new level they stay at, which means I think that suggests

00:53:28   long-term growth opportunity continues to exist, but that people who are

00:53:33   expecting it every quarter are kind of short-sighted.

00:53:37   Last thing, this is a long quote, but there was some conversations about Tim

00:53:43   Cook in regards to AI.

00:53:45   So this is Tim.

00:53:47   This is Tim.

00:53:48   I do think it's very important to be deliberate and thoughtful in how you

00:53:52   approach these things.

00:53:53   And there's a number of issues that need to be sorted as is being talked

00:53:56   about in a number of different places.

00:53:58   But the potential is clearly very interesting.

00:54:00   And we've obviously made enormous progress integrating AI and machine

00:54:03   learning throughout our ecosystem.

00:54:05   And we've weaved it into products and features for many years.

00:54:08   You can see that in things like fall detection and crash detection and ECG.

00:54:12   These things are not only great features, but they're also saving people's

00:54:15   lives and it's absolutely remarkable.

00:54:18   And so we view AI as huge and we'll continue weaving it into our products

00:54:22   on a very thoughtful basis.

00:54:24   This to me felt really similar about the ways that Tim would start talking

00:54:30   about AR.

00:54:30   Right?

00:54:32   Of like, yeah, we think this is really important and we're going to keep

00:54:36   working on this.

00:54:36   Like, I feel like this is, as you would naturally assume, would be a front

00:54:41   that Apple's going to continue to try and do more on.

00:54:43   And at the moment, I think they are in, you know, with how much he went into

00:54:48   detail here is clearly a prepared idea.

00:54:51   They want to, I think, maybe try and turn the tide on the impression that

00:54:56   they don't know what they're doing in this field.

00:54:58   Where they can talk about, look at all these things that are shipping with

00:55:02   what this AI actually is, which is just advanced machine learning.

00:55:06   It's not artificial intelligence.

00:55:08   I really wish that we, that that wasn't what we decided to call it, right?

00:55:11   AI.

00:55:12   Right.

00:55:12   It's all just machine learning.

00:55:13   It's ML.

00:55:14   And Apple has been doing machine learning for a long time and they're good at

00:55:18   it with the things that they're doing.

00:55:20   But the problem is what we consider to be conversational machine learning,

00:55:24   which is now what we think of the chat bots.

00:55:26   They're not so good.

00:55:27   Right.

00:55:28   They're not doing a chat bot, which right.

00:55:30   Like, well, Siri, I mean, like Siri, you have a conversation with, right?

00:55:33   Well, you don't.

00:55:35   Well, yes.

00:55:35   The problem, but yes.

00:55:36   Well, you do it with 20 people, 20 people you talk to.

00:55:38   We know this now.

00:55:40   So I think this is the perfect answer to give if you're Tim Cook, because

00:55:46   what it says is, yes, there's a lot of potential we're being deliberate and

00:55:52   thoughtful, right?

00:55:53   He says, I think it's very important to be deliberate and thoughtful translation.

00:55:57   We're being deliberate and thoughtful.

00:55:58   There are issues that need to be sorted out and we're, you know, it's being

00:56:03   talked about like, it's controversial.

00:56:04   We know that too.

00:56:05   Then it shifts gears and he says, he says, yes, it's very interesting, but

00:56:10   we are already doing this.

00:56:11   So now it's, he's sending the message.

00:56:13   Like we have made enormous progress already in our ecosystem throughout.

00:56:20   And he uses the phrase that I kind of appreciated.

00:56:23   We weaved it into products and features for many years.

00:56:26   Right.

00:56:27   The point here is like, we're already doing this.

00:56:30   And I, in conversations about this, I keep bringing this up too.

00:56:33   People are like, Oh, Apple's behind.

00:56:34   They haven't done any AI.

00:56:35   And it's like all the object detection and photos is AI.

00:56:39   It's ML, right?

00:56:41   All the sensor processing and fall detection and crash detection in

00:56:45   activity monitoring on the Apple watch.

00:56:48   There's machine learning models there.

00:56:49   The ECG apparently is using machine learning models as well.

00:56:52   Like Apple has built a lot of machine learning models in, in a lot of places.

00:56:56   What they haven't done is built it into Siri and they haven't released

00:57:00   a beta chat bot on the web.

00:57:01   And so then they're accused of being behind.

00:57:03   It's like, maybe they're behind, but I'm not sure we've got enough

00:57:07   evidence to suggest that.

00:57:08   And that's what Tim Cook is saying here.

00:57:10   It's like, we've been on this for a long time, but we're being careful and

00:57:13   we're putting in places where it makes sense.

00:57:14   Now, is he throwing shade a little bit?

00:57:16   Yes.

00:57:17   Is he doing that because it's an area of weakness for him?

00:57:21   Maybe.

00:57:21   I mean, maybe, or maybe there's some amazing thing behind the scenes

00:57:25   that we don't know about, but we don't have the evidence for that.

00:57:28   So, so we'll say maybe, maybe he's, he's running down the stuff that's

00:57:32   out there that where Apple's behind.

00:57:33   But pointing out all the other places where Apple has is using this and is

00:57:37   weaving it into their ecosystem, which is one step away from the only Apple

00:57:42   can do this, right?

00:57:43   Which is we have hardware, we have software, we have our own processors

00:57:47   that we design and we weave AI and machine learning throughout our ecosystem.

00:57:52   Instead of just, you know, releasing a chat bot.

00:57:55   That's sort of what he's saying here.

00:57:57   And then he pivots from that back to, we think it's huge.

00:58:02   We'll continue weaving on a thoughtful basis, which is his last little poke

00:58:07   of like, we know this is controversial.

00:58:10   We are also skeptical about the issues here.

00:58:12   You know, look at us.

00:58:14   We, we do it carefully, but we are doing it.

00:58:17   Don't get upset.

00:58:18   Don't get afraid.

00:58:20   It's masterful.

00:58:21   Like whether you believe it or not, like whether you believe that, I mean,

00:58:24   I think that what he says is factual, but there's that whole underlying

00:58:28   question, which is yeah, but like Siri is a good example, like, but you

00:58:31   haven't woven it into Siri really.

00:58:34   And we've seen what happens when you start, start having something

00:58:38   that's sort of Siri-esque, but uses this tech and you haven't done it yet.

00:58:41   So where is that?

00:58:42   And maybe the answer is they're still working on it, but it's close.

00:58:45   And maybe the answer is they've tried it and failed and it's a disaster.

00:58:48   He's not going to say that, but like that's what's on people's minds.

00:58:51   But I think he did as well with this question as you could possibly do,

00:58:55   from the perspective of being the CEO of Apple.

00:58:59   >> Because I feel like from my layman's view, they have done a good job of

00:59:07   what is the fundamentals here, which is very large data sets and being able

00:59:12   to draw information from them, right?

00:59:13   Because that's what a large language model is, right?

00:59:16   But they just don't have a shipping machine learning large language model

00:59:22   thing.

00:59:22   >> Yeah.

00:59:23   >> But they are, I mean, you know, they're doing tons of stuff that their

00:59:28   competitors are doing.

00:59:29   They're doing a very good job in some cases, and they're doing it all on

00:59:32   device, right?

00:59:33   So like photo recognition stuff, being able to search for things in photos.

00:59:39   I'm sure that live text is another example of this, right?

00:59:42   So like all of these little pieces of information that come from their

00:59:47   abilities in machine learning, plus the fact that they create their own

00:59:51   silicon, which has machine learning processes on it.

00:59:53   Like if they're able to line the pieces up, I can imagine that they can

00:59:58   have that point on a presentation sometime that you just said of like,

01:00:01   only Apple can do this.

01:00:02   But they've got to do it.

01:00:05   But I think what is telling to me here is they were willing to answer the

01:00:09   question meaningfully.

01:00:11   And to me, this feels very prepared.

01:00:15   Like to mention fall detection, crash detection, and ECG, like those three

01:00:20   specific features out of everything you could have mentioned, like they're

01:00:24   really good ones.

01:00:25   And I think it shows that they're considering it.

01:00:30   And like if they're considering it and they're willing to engage with it and

01:00:33   talk about like, it's huge.

01:00:35   And you know, there's a lot of promise here.

01:00:36   It feels like that they've got their eye turned towards it at least.

01:00:40   - I don't know if Shannon Cross, who asked this question, who used to be

01:00:46   out on her own and now works for Credit Suisse.

01:00:48   She's been doing this a long time.

01:00:50   She's been on Apple calls as long as I can remember.

01:00:52   I don't know whether Apple said somebody from Apple nudged her and was like,

01:00:57   you should ask them about AI or not.

01:00:59   But I wouldn't be surprised if that was the case.

01:01:00   - Yeah.

01:01:01   - Certainly Apple was ready with this response.

01:01:03   - They wanted someone to ask.

01:01:04   - Figuring somebody would ask about AI, right?

01:01:06   Certainly.

01:01:07   Because this is, again, this is a setup.

01:01:09   It's a perfect setup.

01:01:11   I think Tim Cook's answer is very much put together and exactly what needs to

01:01:16   be said here.

01:01:17   And then we all can judge whether it's entirely.

01:01:19   I mean, everything they do on this call is a self-serving statement.

01:01:22   That's the whole point of it.

01:01:23   - One of it.

01:01:23   - Really?

01:01:24   - Yeah.

01:01:24   - But I think this was handled very well, portrays things really.

01:01:28   The goal here is to say, we recognize that this is controversial.

01:01:31   We also agree with everybody who thinks this could change the world.

01:01:34   We have shipped lots of stuff that uses this and have for a long time.

01:01:39   So don't portray us as being behind.

01:01:41   And we're still on it.

01:01:43   Next, right?

01:01:45   Like that's exactly what Apple wants to say here.

01:01:49   And then the question is just, is he saying that while he's hiding a decaying

01:01:53   Siri team behind him?

01:01:56   Or is he saying that knowing that they've actually got more stuff that people don't

01:01:59   know about that is going to be great?

01:02:02   And I don't know.

01:02:03   I don't know which one of those it is.

01:02:04   - But also I like tying a different thread through what you said of like,

01:02:08   oh, we know it's controversial.

01:02:11   We think, and people believe it could change the world.

01:02:14   But the things he decided to speak about were the things that save people's lives.

01:02:18   - Yep, that's true.

01:02:19   - So like, we believe it can be helpful.

01:02:23   Like what he's saying to me there is like, we believe that the ways that we will use

01:02:29   this technology is the way we have been and will continue to, will have meaningful effect

01:02:32   on the world as opposed to just like doing a Google search.

01:02:37   - The headline is very important to be deliberate and thoughtful.

01:02:42   - Yeah.

01:02:42   - That's the message, right? Which is we are deliberate and thoughtful.

01:02:47   Here are some examples.

01:02:48   They didn't, he doesn't mention photos by the way, right?

01:02:51   Because he really is leaning into things that'll save your life.

01:02:54   Because AI can save your life.

01:02:56   Great.

01:02:56   And then thoughtful, he's not only saying, this is why you don't see us out there with

01:03:02   stuff right now.

01:03:02   We do stuff, but like when you're saying where's Apple's chat bot?

01:03:06   This is why we're deliberate and thoughtful.

01:03:08   We agree with all the people who are critics who are like, oh no, what's this going to

01:03:11   be?

01:03:11   It's like, yes, it's valuable, but you got to think about it.

01:03:14   And then it's also taking a shot at the people and at competitors who are like just throwing

01:03:19   stuff out there and saying, is this what we want?

01:03:21   You know, is this the right way to do it?

01:03:23   And again, if you're in a position where you don't have that, that is the right thing to

01:03:27   do is to throw shade at that stuff.

01:03:30   But it's also the right thing to do if you've got something in the works that you think

01:03:34   is better.

01:03:34   Like, I don't think we can really detect from this where the state of other machine learning

01:03:41   projects are at Apple, but it's the right answer to give to say we're there, but also we're

01:03:47   better than you because we're being more careful and thoughtful.

01:03:50   It's a great answer.

01:03:52   Great PR.

01:03:53   I know this is what I want, right?

01:03:55   Like I am intrigued and concerned in equal measures, sometimes more concerned about some

01:04:01   of these AI tools.

01:04:02   I would like the largest companies that are involved in this stuff to actually be really

01:04:10   thoughtful and not just fast.

01:04:12   Right, which I think is some of the problems we're falling into right now.

01:04:17   I think Microsoft and Google are just trying to be quick in some cases to be the best rather

01:04:23   than necessarily thinking about what is best for their users and for people at large.

01:04:28   And so I hope that Apple will continue down that train, especially because they're the

01:04:31   products that I use the most.

01:04:33   Like when it comes to me, that's what I want to see.

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01:06:47   It is time for some Ask Upgrade Questions to finish out today's show.

01:06:54   The first one comes from Ramon.

01:06:58   Ramon again!

01:07:00   Ramon is back!

01:07:01   Ramon, yes.

01:07:03   And says "Or is it a different one?

01:07:05   Maybe one was Ramon and one was Ramon?

01:07:07   Who could tell?"

01:07:08   You know what I'm- I don't know.

01:07:10   Anyway, last week's discussion of the rumors of changes to the upcoming health app made

01:07:15   me wonder.

01:07:16   So this is like the idea of more data, more processing, all that kind of stuff.

01:07:21   Should we be concerned about Apple gathering so much of our data to grow their services

01:07:26   business as we've been with Google in the past?

01:07:29   Is the on-device argument enough to give them a pass?

01:07:32   It's complicated.

01:07:35   This is complicated.

01:07:36   I would say I don't think Apple gathering data- I think that there is a functional difference

01:07:47   between Apple building a profile of us on our device that is with us at all times.

01:07:54   And it is complicated, right?

01:07:58   Because I feel like, first off, the on-device argument is mostly about we don't need to

01:08:05   pass all of your data up into our servers in order for us to know stuff about you.

01:08:09   And I think that that's good.

01:08:11   And I think that that's a separate thing.

01:08:13   There's the commitment to privacy.

01:08:15   The idea that we don't need to upload all your photos onto iCloud in order for us to

01:08:23   analyze them and tell you whether there are dogs in them or whatever, right?

01:08:27   Which is, I think, the right thing to do.

01:08:29   So I'm less concerned about like, "Ah, yes, but now you're looking at that data on device.

01:08:34   And also you've got on-device algorithms that are going to drive me into on-device

01:08:39   purchases of services."

01:08:41   I'm concerned about Apple pushing services on me that are really things that are just

01:08:49   software features.

01:08:50   And I went into a whole rant about this last week.

01:08:53   The personal data that is being analyzed on devices is not part of my concern about it,

01:08:59   I guess would be my answer.

01:09:00   I feel like maybe it's interesting, but I think this is a conflation of things that

01:09:04   I don't think need to be conflated.

01:09:06   Mike, what do you think?

01:09:07   I think it's complicated.

01:09:10   I think it becomes more complicated because of the phrasing of Ramon's question to include

01:09:16   Google in the discussion.

01:09:18   Because as soon as you invoke Google or Amazon when talking about this stuff, people's brains

01:09:24   go into a route, which is like, "They are going to take my information and sell it to

01:09:31   advertisers."

01:09:32   If you brought Meta into this conversation, right?

01:09:35   And a lot of people, I think, have a fundamental misunderstanding of the way that some of this

01:09:39   stuff works.

01:09:40   Some people believe, and I think most of our listeners would know this, but some people

01:09:44   believe that Meta and Google just give your phone number out to companies, right?

01:09:48   But it's not like that.

01:09:49   That's not what they do because they want to build a business where you have to come

01:09:52   to them to buy access to demographics.

01:09:56   And so they don't share that information.

01:09:58   They keep it within Google or wherever.

01:10:01   Well, within Meta.

01:10:01   The only people that know that information are in theory the companies you're giving

01:10:05   your information to.

01:10:07   They're not spreading it out past that.

01:10:10   But they're using it to sell ads that other people buy, but they're keeping a company

01:10:17   confidential.

01:10:18   So access to you is being sold.

01:10:21   Your data...

01:10:22   I mean, there are places where there are data brokers and there are apps that are leaking

01:10:25   information and all that.

01:10:26   But generally with these companies like Google and Meta, it is the crown jewels, right?

01:10:32   It's that data.

01:10:33   They don't want to give it away.

01:10:35   They want to set a premium price for you to have access to the knowledge that they've

01:10:38   got about you.

01:10:39   So they're selling...

01:10:40   In the end, it can still make you feel just as gross.

01:10:44   But just let's be clear, they're not selling your data.

01:10:47   They're selling access to you.

01:10:49   Isn't that better?

01:10:51   It's not.

01:10:51   I think it's not.

01:10:52   It's a little better, but it's still different.

01:10:55   Yeah, right.

01:10:56   It still should probably give you pause, but it's not the same as saying, would you like

01:11:00   to know everything?

01:11:00   Google is not, I believe, saying, hey, I've got all this information I built about Jason.

01:11:05   I've got a dossier.

01:11:06   Would you like to buy it?

01:11:08   Instead, it's like, would you like to reach people who are like Jason?

01:11:11   Because I know who they are.

01:11:13   And then you have to pay to get access to them.

01:11:15   Personally, I am fine with that.

01:11:17   Like me, like I'm fine with that.

01:11:19   But like, I know, I know that different people have different feelings about it, but I feel

01:11:22   like if you really don't like that, don't use those services.

01:11:24   Like, it seems pretty simple to me.

01:11:25   Like if you really hate the meta do that, just don't use Facebook.

01:11:28   Like it's...

01:11:29   But anyway, that is not the conversation we're having.

01:11:31   But my point is like, it's not that different, really.

01:11:37   Like fundamentally, what's going on here?

01:11:39   Because what Apple is doing is saying, give us all of your information and we'll do what

01:11:46   we do with it.

01:11:48   And while we may not be selling it to other companies, we're still using the fact that

01:11:52   we have your information to sell you things, whether it's the next Apple Watch, like Fitness

01:11:57   Plus or like whatever.

01:11:58   So like realistically, it's just because Apple doesn't have the business model that meta

01:12:05   and Google do.

01:12:06   Let me see if I can draw a line here.

01:12:08   If Apple were, and I don't think Apple will do this, but if Apple were to say, we've analyzed

01:12:15   your health data on your device and oh boy, you really need to get healthier.

01:12:24   Sign up for our service where we let you get healthier.

01:12:26   Sign up for Fitness Plus or whatever.

01:12:28   - How far away are we from something like that happening realistically?

01:12:31   - Well, here's the thing.

01:12:32   I don't think Apple will cross that line.

01:12:34   So contrast that with Apple just says, hey, we've got a new service where we look at your

01:12:39   health data and it's wrapped into Fitness Plus or it's a different service.

01:12:43   'Cause we don't know, this is just a rumor that we are talking about.

01:12:47   But this question of like, is it a service?

01:12:49   Is it part of Fitness Plus?

01:12:50   Is it something different?

01:12:51   I think that that is actually a pretty strong dividing line, which is, is Apple looking

01:12:56   at our data on our device and then using it to sell us things?

01:13:01   Or is Apple just selling us things because we are who we are?

01:13:04   And does it matter?

01:13:05   'Cause then the next question is, does it matter that Apple's analyzing our personal

01:13:09   data for marketing purposes for its own products on our device?

01:13:11   It doesn't matter that it's on our device at that point if they're doing that analysis?

01:13:16   And what I would say is, I think this is the lesson learned by the CSAM scanning that was

01:13:24   gonna go on and that got canned, that was gonna go on when your device was about to

01:13:30   upload something to iCloud, where it was using its algorithm to scan your photo to see if

01:13:36   it was child sex abuse material before it got uploaded to iCloud.

01:13:41   And everybody was like, what do you mean there's a cop on my phone now?

01:13:44   And Apple's like, oh, yeah, backing off, right?

01:13:50   So that's what I would say here is, if Apple's just doing what it does, which annoys people

01:13:55   to no end, right?

01:13:56   Which is marketing its services to you.

01:13:58   Hey, we added some features to Fitness Plus, isn't that awesome?

01:14:01   You should sign up.

01:14:01   Or if you're already a Fitness Plus member, you should opt into this and we'll analyze

01:14:05   your data and give you tips.

01:14:07   And you say, yes, what they can't do, I think, is look at your data and then market it to

01:14:14   you, right?

01:14:15   Like, I think that's where I would draw the line is, I don't want you saying, hey, you

01:14:23   got a problem and we're the solution and we know it because we've seen your data on

01:14:28   this iPhone.

01:14:29   But like, they do this with App Store ads, though, right?

01:14:31   Yeah, the App Store is not your health data that's on your device.

01:14:34   The App Store is in the cloud.

01:14:36   Right, but it's still only a step.

01:14:38   Well, my point is, like, if Apple continue pushing into advertising, which it seems like

01:14:42   they are, right?

01:14:43   There has been like, they are just trend they're going into advertising further and further.

01:14:47   Where does it stop?

01:14:49   Like, my point is that I agree with you that these things will be bad.

01:14:53   I'm just not confident that they won't do them because they're a company we've just

01:14:59   spoken about their earnings report and the services push like, enough is sent as a line

01:15:05   and they'll be like, well, we're going to start recommending to customers.

01:15:10   We don't know who they are because it's all on device, but we're going to start making

01:15:14   these recommendations to people like, hey, why don't you check out this activity in

01:15:18   Fitness Plus?

01:15:18   So that's that's the question is what if App Store I mean, this is not the question that

01:15:23   Ramon asked, but let's go down that path, which is what if Apple's App Store ads stopped

01:15:29   being based on your cloud and iCloud and Apple ID data stuff that Apple has on its servers

01:15:37   that it knows about?

01:15:38   And what if it started being that all your ads in the App Store were based on on device

01:15:44   behavior, right?

01:15:45   Let's just walk down that path.

01:15:47   So it doesn't on your device, your device could theoretically know what's on a home

01:15:54   screen versus an app library.

01:15:55   How often do apps get launched?

01:15:58   What are those apps?

01:15:59   How often are you using particular kinds of apps?

01:16:02   And then all on device, it goes, oh, wow, Jason is playing Marvel Snap a lot on his

01:16:07   iPad.

01:16:08   What are other apps we could push at him that are like Marvel Snap?

01:16:11   Because he's playing that one a lot, which is probably more than Apple has off device,

01:16:17   right?

01:16:17   I mean, maybe not.

01:16:18   It depends on device metrics and all that, but they don't seem to be using that level

01:16:22   of data to sell me things up in the App Store.

01:16:24   So let's just go with it for a moment.

01:16:26   Like, does that cross the line where it's like, well, wait a second.

01:16:29   What apps?

01:16:30   I feel like this about TikTok.

01:16:31   Honestly, it's one of the things that repels me about TikTok is that if you pause and don't

01:16:37   do anything to indicate I like this video, but you watch a lot of it or watch some of

01:16:44   it, TikTok will be like, gotcha and log it.

01:16:48   And that's what it does.

01:16:49   It's watching your behavior, not your chosen.

01:16:53   I am going to say I like this, but literally like, yeah, you said you didn't like it, but

01:16:57   you watched it for 40 seconds.

01:16:58   So we know you liked it, right?

01:17:00   This is that kind of thing, which is my iPhone is now watching all of my behavior and you

01:17:07   are using it to build a profile all on device, all on device, but it's using that and they

01:17:12   build an algorithm so that now they can advertise to me more effectively.

01:17:16   I doubt they would do that.

01:17:21   I would have a problem with it, but I also see your point, which is, can you imagine

01:17:28   a scenario where Apple continues down this path while searching for advertising revenue

01:17:32   and services revenue?

01:17:33   I would say I can envision it, but I feel like we've already learned some lessons about

01:17:39   when people start to push back on what happens on device.

01:17:42   When on device goes from being a privacy feature to being a surveillance feature, that's when

01:17:49   it all falls apart.

01:17:50   And I'm not sure Apple really wants to go down that path because they use on device

01:17:54   as a shield to say, we do things on device and that means it's safer for you.

01:17:59   And if they muddy the waters by saying, no, no, actually on device is spying, which it

01:18:03   was sort of with the CSAM detection thing where, I mean, we talked about it last year.

01:18:08   It's a detailed argument.

01:18:08   It's very complex.

01:18:09   But the idea was people walked away thinking there's a cop on my phone, right?

01:18:13   The last thing you want is to say Apple is spying on me.

01:18:17   Everything I do on my phone, Apple is watching and turning it into a product all on device,

01:18:22   but still turning me into a product.

01:18:23   I think people would really resist that and I think Apple would probably not stoop to

01:18:28   that, but it's worth considering because the technology is there.

01:18:32   You could do it.

01:18:33   I agree with you.

01:18:34   That situation that you've painted, if they did that, that would be terrible.

01:18:38   I just feel like sometimes some of their ad stuff and like the, um,

01:18:43   at tracking transparency stuff, like I had kind of a problem with that at the time.

01:18:47   I still continue to, because it hasn't really changed anything, like, except like it's,

01:18:53   it's made things maybe smaller, harder for smaller companies to try and do tracking.

01:18:59   I think it's made things harder for Facebook, but you're right.

01:19:01   It's also made things harder for anybody who is trying to use Facebook

01:19:04   to reach people with their advertising.

01:19:08   But like if Facebook's most recent earnings, they kind of seem to be like,

01:19:11   "Oh, it's good now."

01:19:12   It's like, oh, they've worked out their own thing, like whatever this is now to try and

01:19:18   work out the segmentation again.

01:19:20   My point is like Apple does a bunch of segmentation stuff.

01:19:22   They do all the same things, right?

01:19:24   Like they're not for like purchases and how they recommend ads.

01:19:27   And they like, they put you into a bucket and they look at that bucket and they sell

01:19:32   these buckets and all that kind of stuff.

01:19:34   So my concern is that, as you say, like the on-device stuff is a shield.

01:19:39   Hopefully they don't ever try and put ads behind that shield.

01:19:42   But I do feel like from a fundamental level, they are still using your data to sell things

01:19:52   to you.

01:19:53   They just sell different things.

01:19:55   Yeah.

01:19:56   That they're not selling your information for necessarily people to advertise to you

01:20:01   unless it's apps.

01:20:02   Right.

01:20:04   They're doing a similar kind of thing there.

01:20:06   And a lot of the information that you put that's on device is weirdly used as like a

01:20:11   lock-in to sell you more of their own products anyway.

01:20:14   So it's all kind of comes down to what companies you feel most comfortable with.

01:20:21   I feel most comfortable with Apple and giving them all of my information.

01:20:25   Like I am most comfortable with them.

01:20:26   But the idea that they are like fundamentally different from anyone else doesn't necessarily

01:20:34   pass with me because ultimately it's still the same or it's still just your data.

01:20:39   They're just using it to sell to you differently.

01:20:43   And then you maybe you're just happy with that different.

01:20:45   This is the, yeah, this taking a step back.

01:20:49   The point here is that Apple has data that it's using to profile you and sell things

01:21:01   like app store ads.

01:21:02   Right.

01:21:03   And while Apple's business is different, it's not that different.

01:21:07   Right.

01:21:08   It's the thing you and I have talked about a lot, which is like, there's a lot of reflexive

01:21:12   ooga booga scary boogeyman stuff about Google and Facebook and Amazon.

01:21:18   And like, and it's true, their business models do require a level of profiling and surveillance

01:21:24   that maybe Apple's business model doesn't.

01:21:26   But app tracking transparency in a way is just a self, although it's a privacy thing,

01:21:33   that's how it's sold.

01:21:34   What it really does is say, well, you should only collect data as a first party and Apple

01:21:41   is the first party.

01:21:42   And so Apple, because it runs the app store knows everything about your app store behavior.

01:21:47   And they use that to sell ads.

01:21:48   So although it's different than Google and Facebook, not that different.

01:21:55   It's not that different.

01:21:56   It's different, but it's not as different as you might think.

01:22:00   And you need to go in with your eyes open.

01:22:02   I guess I would just say, I think there's a point at which it goes from being, you know,

01:22:10   we're using your data that you do on our servers to do ads.

01:22:17   We're using your app store data to do ads in the app store is different.

01:22:23   It's way different from the idea that like we're watching all your behavior on your iPhone.

01:22:26   Let me use that for an array of different products.

01:22:28   And I don't think they'll get there, but I think it's also important to point out that

01:22:35   on device isn't necessarily a panacea that on device could potentially go from being

01:22:41   this shield of we don't want to process all your photos unless you upload them to iCloud.

01:22:47   You know, we don't want to see them and we're going to do things end to end, which means

01:22:50   that it's going to be has to be on your device and like, that's all good.

01:22:54   But you can flip that over and say, we've built stuff to spy on you for our profit and

01:23:00   put it on your device.

01:23:01   And that's the danger of that.

01:23:05   So it's something for all of us to watch.

01:23:07   Because as you mentioned a minute ago, they got very close to we built something to spy

01:23:13   on you so we didn't have to worry about it.

01:23:15   Right.

01:23:16   They got super close to that.

01:23:18   So it wasn't inconvenient for us.

01:23:20   We made it inconvenient for you.

01:23:21   And I should point out when we talk about app store, we should say, keep in mind, this

01:23:27   is literally the only app store you can use, right?

01:23:31   So they're using their power to say, we know everything about all software buying behavior

01:23:38   on our platform, everything.

01:23:41   And if you don't like that, it's not like photos where you can be like, no, I don't

01:23:45   want to use iCloud photo library.

01:23:46   And you still get those scanning features and it all still works because it's on device.

01:23:50   With the app store, you have no choice but to be in their system.

01:23:55   And it's a system where they're making money on ads.

01:23:58   So I mean, I think app store ads are offensive.

01:24:02   And this is one of the reasons I think they're offensive is because you can't really escape

01:24:06   it and they degrade the user experience and they know everything you've bought so that

01:24:10   they can customize those ads.

01:24:12   Including in app purchases.

01:24:13   So at the point where you as a person have become a customer of another company and are

01:24:19   buying things within their app, Apple knows that information and uses that information

01:24:25   to make more ads for you.

01:24:26   Right.

01:24:26   And doesn't consider you a customer of another company.

01:24:28   They consider that purchase an Apple purchase, right?

01:24:30   That's part of it too.

01:24:31   It's like, it's all still first party because an in-app purchase in somebody's app is

01:24:35   still a purchase through Apple.

01:24:37   So you're still Apple's customer as far as they're concerned.

01:24:39   And that's part of the story.

01:24:41   There's a lot here.

01:24:42   I don't entirely agree with Ramon's take, but I appreciate him having us explore this

01:24:48   because I think that there's a lot of really interesting potential here.

01:24:51   Yeah.

01:24:51   I think Ramon is just concerned, right?

01:24:53   And I get that concern because I think about it a lot.

01:24:56   Right.

01:24:57   On device, I love the, does the on device argument give them a pass?

01:25:01   And I think the answer is no, that on device can be used for good or evil, right?

01:25:07   And that's something that we all need to watch.

01:25:09   And I think, again, I think maybe Apple learned that lesson in the reaction to the CSAM scanning.

01:25:14   I think maybe Apple realized there are some things that if you do it on device, it blows

01:25:21   their whole on device argument and they need to not do that.

01:25:24   But you never say never, you know, you get a vice president somewhere who's being given

01:25:29   an incentive to maximize revenue and they have enough pull to get a feature installed

01:25:33   that does something like never say never.

01:25:36   But I'm skeptical that they'll go down that path because I feel like maybe they learned

01:25:40   a valuable lesson from this.

01:25:42   But it doesn't change their business model in other places.

01:25:45   Yeah.

01:25:46   Chris asks, do you think Apple's headset will have a cellular connection or will it just

01:25:52   be on wifi?

01:25:54   This one, wifi.

01:25:55   Long term cellular, right?

01:25:57   Because long term you're going to want to do mixed reality and you're going to be out

01:26:00   there, but in this one, it's just going to be wifi, right?

01:26:02   Like this is an inside thing.

01:26:04   And I think Apple considers inside spaces, wifi spaces.

01:26:07   If you're in the hotel, you might have to log in with your browser in VR, put in your

01:26:12   room number, whatever.

01:26:13   But like, I think in the long run, obviously it's going to have to be cellular, but not

01:26:19   in the short run.

01:26:19   Hmm. Now you have one of those, like, you know, I was thinking you're in hotels and

01:26:24   you had that like pop-up thing is put your room number in massive 70 foot, right in your

01:26:29   view.

01:26:29   Yeah, sure.

01:26:30   You got to climb up onto the field, smash the button, type it in.

01:26:35   Uh huh.

01:26:36   Yep.

01:26:37   If you would like to send in a question for us to answer on this show, as you can tell,

01:26:43   they could be very different.

01:26:44   You can ask us anything.

01:26:47   Go to upgradefeedback.com and you can send us in a question there.

01:26:51   And of course you can find a link to that in the show notes.

01:26:54   If you would like to, you can send us in questions for Ask Upgrade, Snow Talk and anything else.

01:27:00   Maybe you have follow-up, maybe you have feedback about the show.

01:27:03   Maybe you want to be one of Mike Hurley's tip line informants.

01:27:07   You can go to upgradefeedback.com and send that information in.

01:27:10   If you want to check out Jason's work and see all of his wonderful charts that he's

01:27:14   been generating over the last week.

01:27:15   You can go to sixcolors.com.

01:27:17   You can also hear Jason's podcasts at the incomparable.com and here on Relay FM, where

01:27:22   you'll also find my shows.

01:27:24   You can check out my other work at cortexbrand.com.

01:27:27   You can find us on Mastodon.

01:27:29   Jason is at Jason Elle on zeppelin.flights.

01:27:31   You can find me as @imike on mike.social, and you can find this show as @upgrade on

01:27:37   relayfm.social, which is one of the three places currently that you can see clips of

01:27:42   this show.

01:27:43   You can also watch them on TikTok and Instagram.

01:27:46   We are @upgraderelay on both.

01:27:48   I've got to say, I'm coming around.

01:27:50   I've come around on this.

01:27:52   I really like the clips.

01:27:54   Clips are good.

01:27:54   I'm enjoying them.

01:27:56   Thank you to our members who support us with Upgrade Plus.

01:27:59   Thank you to ExpressVPN and Ooni for their support of this episode.

01:28:03   But most of all, thank you for listening and we'll be back next time.

01:28:06   Until then, take good by Jason's now.

01:28:09   Everybody enjoy your pizza.