Apple

Tech’s Frightful Five: They’ve Got Us

12 May 2017

From The New York Times:

A few weeks ago, I bought a new television. When the whole process was over, I realized something incredible: To navigate all of the niggling details surrounding this one commercial transaction — figuring out what to buy, which accessories I needed, how and where to install it, and whom to hire to do so — I had dealt with only a single ubiquitous corporation: Amazon.

It wasn’t just the TV. As I began combing through other recent household decisions, I found that in 2016, nearly 10 percent of my household’s commercial transactions flowed through the Seattle retailer, more by far than any other company my family dealt with. What’s more, with its Echos, Fire TV devices, audiobooks, movies and TV shows, Amazon has become, for my family, more than a mere store. It is my confessor, my keeper of lists, a provider of food and culture, an entertainer and educator and handmaiden to my children.

. . . .

This is the most glaring and underappreciated fact of internet-age capitalism: We are, all of us, in inescapable thrall to one of the handful of American technology companies that now dominate much of the global economy. I speak, of course, of my old friends the Frightful Five: Amazon, Apple, Facebook, Microsoft and Alphabet, the parent company of Google.

The five are among the most valuable companies on the planet, collectively worth trillions.

. . . .

 [L]ast week I came up with a fun game: If an evil, tech-phobic monarch forced you to abandon each of the Frightful Five, in which order would you do so, and how much would your life deteriorate as a result?

. . . .

When I went through the thought experiment, I found that dropping the first couple of tech giants was pretty easy — but after that the process became progressively more unbearable. For me, Facebook was the first to go. I tend to socialize online using Twitter, Apple’s messaging system, and Slack, the office-chat app, so losing Mark Zuckerberg’s popular service (and its subsidiaries, Instagram, WhatsApp and Messenger) was not such a big deal.

Next, for me, was Microsoft, which I found slightly more difficult to quit. I don’t normally use any Windows devices, but Microsoft’s word-processing program, Word, is an essential tool for me, and I’d hate to lose it.

In third place, full of regrets: Apple. There’s nothing I use more than my iPhone, and close behind are my MacBook and iMac 5K, which may be the best computer I’ve ever owned. Abandoning Apple would prompt deep and truly annoying rearrangements in my life, including braving Samsung’s bad software. But I could do it, grudgingly.

Link to the rest at The New York Times

Apple cuts App Store affiliate commission from 7% to 2.5%

25 April 2017

From TechCrunch:

Apple just sent an email to members of the App Store affiliate program saying that App Store commissions will be reduced from 7 percent to 2.5 percent on May 1st — that’s a 64 percent cut. While this change will have no effect on App Store users, it has some implications on the App Store ecosystem.

Many websites from the Apple community link to App Store downloads with a unique referral ID in the link. When customers buy apps or in-app purchases using this link, Apple gives back a small cut to its affiliate partner. Developers still get 70 percent of the sale while partners get incentivized.

. . . .

For a $1 app, this affiliate commission is just a few cents. But it can add up if you’ve built a serious audience. And I know this because I’ve experienced this myself.

. . . .

Our little website got something like 15,000 readers per month. And we made hundreds of euros in the first few months with App Store commissions and a Google ad near the bottom of the page. It wasn’t anything groundbreaking, but it was a fun little way to make some money as a kid who didn’t want to work during summer break.

. . . .

If Apple drastically cuts this revenue stream, the company could end up alienating people writing for those sites. But it could also indicate that some bigger App Store changes are coming soon.

Link to the rest at TechCrunch and thanks to Elaine for the tip.

While Apple’s iPad remained the Leader in Tablets for 2016, Innovation is needed to reinvigorate the Sector

18 February 2017

From Patently Apple:

While Apple toppled iPad expectations for 2016, the fact remains that for the year iPad sales dropped 14.1%, more than double the industry as a whole which fell 6.6%, according to the latest TrendForce report covering the tablet market. Apple’s total shipment for 2016 came in at 42.55 million units. Strong demand for iPad in North America and exceptional results from year-end holiday sales sustained iPad shipments last year.

. . . .

TrendForce report Anita Wang pointed out that “Apple has as many as three to four new iPad products lined up for 2017. In addition to an economically priced 9.7-inch model that is ready for market release, Apple will also launch a new 12.9-inch model. Furthermore, Apple will also introduce a new 10.5-inch iPad. This will be a new size category for the device series.”

TrendForce estimates that this year’s iPad shipments will fall by 6~8% annually to around 40 million units. There are reports of a “Pro” version of iPad mini being planned. If Apple decides to release such a product this year, the annual iPad shipments may stabilize and even register growth.”

Adding more “Pro” iPad models is simply means that more iPads will be able to use Apple Pencil.

. . . .

On the flip side, Amazon’s cheapo tablet market approach allowed them to double sales (99.4% to be exact) from last year and zoom to the number three spot worldwide with 11 million units. Anyone can sell cheapo tablets at a loss like Amazon, so on that count at least Microsoft is a pure competitor trying to innovate and make a profit. Microsoft also doesn’t want to enter the lower end of the model and compete with their Windows partners.

Link to the rest at Patently Apple

PG says disruptive technology always enters and builds in a market from the cheap side up. He doesn’t know if this is Amazon’s strategy, but bang for the buck is a powerful marketing and sales tool.

Amazon May Be About To Build A True iPad Challenger

13 February 2017

From Seeking Alpha:

Amazon is having shortages throughout its product lineup at present. E-Readers, tablets, streaming boxes, voice assistants and Prime-exclusive phones all have at least one model out of stock for two weeks or more. All but the phones and E-Readers have half or more of their total model variants out of stock.

. . . .

It first came to my attention when I did my customary check of Amazon’s tablet devices this weekend and noticed that the Fire HD8 was now being advertised at a $120 price, $30 higher than it was at launch. At first I thought the price had actually been hiked, something almost unheard of for The Everything Store. But no. Actually, the company had just replaced the baseline variant with the 32GB expanded storage variant, which had always been $120. The reason why is simple: the more popular, 16 GB $90 version is out of stock all the way until April 7th. And the shortages are still spreading. Two of the four color variants of the HD8 32GB are also now out of stock, one until early April again and the other for up to six months!

. . . .

The shortages are also not limited just to the Fire line. They extend throughout Amazon’s device family. The Echo Black is sold out again until February 25th, just like it was over Christmas when sales rose nine times over year ago levels. The White is still in stock, however. Meanwhile, the Kindle Paperwhite has just the opposite problem: the black option is still in stock but the white is sold out. Echo’s $50 cousin, the Echo Dot, is sold out until the same date for the White color option, the black is sold out until March 2nd.

. . . .

The shortages of so many products simultaneously outside the holiday season are somewhat unusual, certainly. Usually, when products go out of stock outside the holiday crunch, it means that the devices are about to be retired and replaced with updated models. But it’s unlikely Amazon is going to literally replace its entire product lineup in the space of a few weeks.

Another explanation is that Amazon devices are just that good, just that in demand. But product shortages have now exceeded those in the heart of the holiday season, which was an unqualified success for Amazon.

. . . .

My interpretation of this data is that we are actually seeing a confluence of a couple of different trends in the device market. While a device-wide shortage might seem to imply a device-wide explanation, I think a few different things are going on. The Fire TV and Echo shortages are simply natural shortages of in-demand products in rapidly growing sectors. The HD8 shortage is probably real, but being exaggerated. The other shortages, however, are something else.

The Echo and Fire TV are really Amazon’s two most successful product lines, even above tablets. While Amazon’s tablets sell well, they are still regarded as just “good enough,” things you buy because the value per dollar is so much better even though they are not top of the line.

By contrast, Echo and Fire TV are widely seen as leaders in their field, things you buy because they are the very best money can buy.

. . . .

The tablet shortage, however, I believe does portend a pending product refresh and potentially a very significant one.

. . . .

I noted before that the HD8, while still not as cheap as its $50 cousin, is actually a pretty incredible engineering feat for Amazon. An HD upgrade used to triple the price of a Fire device. Now, it is only $40 more to get more memory, more processor power, and most importantly to many users, a battery life twice as long at 12 hours or better.

Amazon did a pretty remarkable thing achieving all of that with a 40% price cut in one year. And it has a lot of people telling tablet shoppers that they are really better-advised to spring for the extra $40 for everything they are getting for it.

. . . .

The last shortage, however, has a different cause, I think. Of all of these shortages, only one device is listed positively as out of stock indefinitely. That usually means it is never coming back, and that usually means a product refresh. It came as a surprise to more than a few people that Amazon did not update the HD10 prior to the holiday season, including me. If Amazon is now finally ready to do so, it would explain why the current HD10 is not only out of stock, but out of stock with no projected return date.

. . . .

HD10 represents Amazon’s last remaining foothold in the higher-priced market, though still nowhere near full-sized iPad prices. But it is the closest thing iPad has to a direct competitor in the Fire lineup, the one variant that almost comes off as “for iPad lovers who don’t want to pay for an iPad.”

. . . .

The HD10 upgrade may be more significant. If Amazon can reproduce the battery life gains it made with the Fire HD8 and pair them with some higher-powered processors like what it sold in the old HDX lineups, closer to what iPad and high-powered Androids offer, it will mark a new kind of Fire tablet. Or a return of the old kind, more accurately. If it can do this without any price increase and perhaps even with a price cut below the psychologically important $200 threshold – i.e. $199 – it may create a strong new challenger in a shrinking market.

Link to the rest at Seeking Alpha

I Wish Apple Loved Books

8 February 2017

From DimSumThinking:

There’s an old joke, “how do you know when your friend is a Vegan.”

“Don’t worry,” the answer goes, “they’ll tell you.”

The same is true about Apple and projects they are passionate about.

Listen to Jony Ive describe the Apple Watch and you know he loves traditional time pieces and was passionate about improving the experience. Look at the Health Kit team and you know they care about improving lives with this device. You’ve got a team involved in imagining what this device can become.

Two years in a row Apple devoted valuable time at their developer conference to Apple Music. There wasn’t an announcement either year that made any difference to developers and yet we heard from Bozoma Saint John this past year and Jimmy Iovine the year before. We saw a video featuring Zane Lowe talking about his years of experience as a radio personality before being wooed to lead the efforts at Apple Music’s Beats 1.

You might like or hate what Apple has done with music but from programming and content, to software, to Air Pod headphones that you can control from your watch – Apple clearly has a passion for music.

. . . .

I’ve joked that if Eddie Cue loved reading the way he clearly loves music, then iBooks, the iBookstore, and iBooks Author would be amazing. Not only aren’t they amazing, they aren’t even good.

It’s like they’ve assigned a committed carnivore to design the meals and cook for Vegans. You need someone who loves and understands vegetables and shares the commitment to not using meat or meat products.

How do you find someone who loves books and reading?

Don’t worry, they’ll tell you.

I don’t believe there are a significant number of people who are passionate about books and reading involved in iBooks, the iBookstore, or iBooks Author.

. . . .

iBooks Author could have been a trojan horse into the personal publishing business. It would have been classic Apple. Instead of small authors going to Amazon’s platform, they would have started with iBooks Author. Apple should have made it easy for them to push to Amazon as well. Why? Because these people wanted to publish on Amazon but they weren’t considering publishing with Apple. Thousands of authors would have come to Apple to create content and stayed with Apple after publishing content there.

OK, so iBooks Author is essentially abandonware, what about iBooks and the iBookstore.

. . . .

Yesterday, I uploaded my latest version of my book to Gum Road and to iBooks. Within minutes I was getting email notifications of sales of my book on Gum Road.

An hour later my book was approved for sale on iBooks. This is remarkably quick. It used to take days. I looked online and my book wasn’t on the iBookstore yet. Also, my name was still listed incorrectly.

Sigh.

In the tool for uploading your book to the iBookstore, the prompt for the author’s name reads “Last Name, First Name”. So I entered it that way. So my book appeared on the store as written by “Steinberg, Daniel H” and was not connected in any way to any of my other books. It turns out it’s been like that for months – I just found out about it.

I called customer support and opened a ticket. The person was as nice as can be and said they couldn’t change it but I could upload a new version of the book with my name corrected and then they could fix it.

So I called customer support yesterday after I uploaded the new version of my book to check that the name was fixed.

Derrick told me that it probably was but I couldn’t be sure until the book appeared on the store.

But, I told him, iTunesConnect says my book’s been approved – can’t he check.

Well, he said, it has been approved but it might not appear on the store for a day and I should check back.

As I found out later when the puzzled emails started to pour in to my Inbox, my book hadn’t been approved. In fact, the existing book was pulled from the store for violating Apple policy. The version that had been for sale on the store for two months incorrectly used the word “iBook” as in “When I released this iBook.” Apple wants you to refer to it as a book. Using the word “iBook” in this context violates Apple policy and they had removed my book.

Then they went home.

I fixed the problem within minutes and uploaded it.

Apple rejected my upload. The version number wasn’t larger than the version number of the current book for sale on the store.

Link to the rest at DimSumThinking and thanks to Nate for the tip.

Amazon and Apple end exclusive deal on audio books

21 January 2017

From The BBC:

Apple and Amazon have ended a deal that tied them into an exclusive contract for the supply and sale of audio books.

The deal was signed before 2008 when Amazon bought audio book supplier Audible, which had the Apple iBooks contract.

Pressure from anti-trust regulators in Germany and the European Commission led to the deal being abandoned.

. . . .

The terms of the agreement meant Audible could not offer audio books to any other company and Apple had to take audio books only from Audible.

The investigation into the Apple-Amazon arrangement over audio books was started by the German Federal Cartel Office in late 2015. It responded to complaints from German publishers who said the two tech giants were abusing their market dominance.

In Germany, said the publishers, more than 90% of all downloads of audio books were done via the Apple iTunes store or through the Amazon and Audible websites.

With the deal abandoned, Audible will now be able to supply firms other than Apple with audio books. In addition, Apple can now get audio books from other sources and sign up other publishers who can push their titles through its iTunes and iBooks outlets.

Link to the rest at BBC and thanks to Jan for the tip.

How Microsoft rebounded to outshine Apple

21 December 2016

From CIO:

Microsoft claims that more people are switching to Surface devices from Macs than ever before. That’s a concept that would have been hard to picture when Microsoft first released the Microsoft Surface RT and Surface Pro in 2012 and 2013, respectively. The Surface RT suffered from a watered-down version of the new — and generally disliked — Windows 8 operating system and, while the Surface Pro featured the full desktop version, it came with hardware limitations and a high price tag.

In a sea of clam shell notebooks, all vying to be thinner and lighter than the last, the Surface clumsily debuted as a confusing mashup of a tablet and a laptop. And people didn’t like it. RT users complained of the limited functionality and never-ending bugs, while Surface Pro users were forced to pay a high price just to avoid Windows RT. In fact, the Surface RT did so poorly that Microsoft had to take a $900 million dollar write-down after drastically cutting the price of the device.

. . . .

For a company once targeting modern, creative professionals, it’s hard to tell who Apple makes products for anymore. Apple’s devices now feel tailored to a low-tech crowd, or people who like new tech, but just aren’t that interested in specs. They want a reliable, easy-to-use device that just works. But where does that leave the original fan base of creative workers who need high-performance and cutting edge features? Apple hasn’t left this industry with many options — and at this point, you can get more for your money in graphics and performance on a Surface Book than a Macbook Pro. Plus, with the newly announced Microsoft Studio, there is finally a strong alternative to the iMac — with a touch display, no less.

Apple’s compromise is the MacBook Pro with Touch Bar, which features a dynamic touch bar replacing the row of function keys on the keyboard. The display changes depending on settings and the app you’re using; it’s a cool feature, and certainly useful, but it’s a confusing message. If the iPad Pro is competing with hybrid notebooks like the Surface Pro 4, but Apple doesn’t think people want touch-displays on a notebook, then does that make the iPad Pro a giant iPad?

. . . .

Remember when Windows users were the boring, out of touch, suit-wearing nerds in commercials, and a Mac user was the hipster CEO of a startup — that guy in 2006 who wore hoodies and scootered to all his meetings? That landscape has changed a lot since then, and now Microsoft is the one calling out Apple on selling outdated hardware and falling behind the curve.

Link to the rest at CIO

PG is comfortable saying that 99% of the books in the English language are written on devices running either Microsoft or Apple software (although Google may be moving up).

Why 2016 Was a Watershed Year for Tech

19 December 2016

From The Wall Street Journal:

As 2016 nears an end, five of the seven most valuable companies in the world—including the three most valuable—are technology companies. Beyond their worth in the eyes of investors, Apple Inc., Google parent Alphabet Inc., Microsoft Corp., Amazon.com Inc.,and Facebook Inc. also are powerful forces in everyday lives. Tech can seem inescapable.

That helps explain why 2016 also was a difficult year for many of these companies. Collectively, they faced sharp criticism and unprecedented levels of scrutiny while clashing with governments around the world—including the future U.S. president.

It’s no coincidence, for example, that digital-ad spending in the U.S. has been projected to eclipse spending on TV ads in 2016, while Facebook battled concerns about its influence over politics and its role in spreading fake and distorted news. Those developments are two sides of the same coin—Facebook’s power.

. . . .

Or take Amazon’s new cashier-free stores, which instantly became symbols for how automation “kills” jobs. Amazon has only a handful of physical stores, and doesn’t plan to open its first Amazon Go store to the public until next year, yet its dominance in online retail made this a source of much public concern.

Link to the rest at The Wall Street Journal (Link may expire)

How Amazon And Apple Show That High Profits Stop Companies From Dreaming Big

15 September 2016

From Forbes blogs:

When Amazon first introduced its own tablet, it seemed like just another me-too entrant into a hot category that Apple had pioneered. Five years later (last Saturday), Amazon.com launched a new model that takes its low-price obsession to the extreme. The latest Fire HD 8 comes with 12 hours of battery life and 200 GB of storage. Not only does it include rear and front cameras, but it also comes equipped with Alexa—the voice-controlled helper that answers questions, plays music on command, orders pizzas, and does much more. The price? A jaw-dropping $89.99 compared to Apple’s 8-inch iPads, which start at $399. So, while the overall tablet market has seen some sharp declines in recent quarters, Amazon tablet sales have surged 5,421% in 2016.

. . . .

Every respectable business school teaches at least one thing to aspiring MBAs: Prioritize investments on innovations that promise the highest returns. That is why, in each company, a watchful financial controller assesses investment opportunities and carefully allocates corporate resources. In an ideal scenario, the company sees its operating margins increase steadily with the launch of more profitable products over time. Apple is the poster child for this. The company’s stellar margins of nearly 40%, more than double Samsung’s 16.3%, have charmed investors.

. . . .

But no company operates in a vacuum. Apple’s real trouble lies in its high profitability; it has competitors which are only too happy to live on lower margins.

. . . .

A favorite maxim of Amazon’s Jeff Bezos is “Your margin is my opportunity.” Amazon built its empire selling books, CDs, and DVDs. Next came video streaming, then the Kindle, then the audiobook company, Audible. At every turn, Amazon forewent profitability. Instead, it “trained” investors to accept razor-thin margins. Adopting such a strategy, however, would also have impacts outside Amazon. It has created a precarious situation for a well-run, highly profitable firm such as Apple, whose sheer profitability severely limits what it can pursue now. And Apple is far from being an exception.

Link to the rest at Forbes blogs

Frank Ocean’s release of Blonde marks the start of a major fight in the music industry

25 August 2016

From The Verge:

It was only a matter of time.

The release of Blonde marked much more than Frank Ocean’s musical return after four years away. After satisfying his Def Jam deal with the release of Endless, Ocean released Blonde independently in a move that marks the first shot in an inevitable fight between music labels and streaming services.

The relationship between an artist and a music label has been a notoriously fraught one, but until recently, there was nowhere an artist could run to when they tired of their label besides the next label down the street. Now, in a race to get more subscribers for their streaming services, the biggest company in the world and one run by an artist have positioned themselves as a friendly alternative for musicians. Meanwhile the labels, in a bid to avoid a future they may not be able to survive, may ultimately end up on the side of some fans who want music available through every viable medium.

. . . .

This is the nightmare scenario for music labels. For years, labels have feared that as streaming services grew in power and scope, there could come a time when some artists could choose to forego working with the labels and engage directly with a streaming service to reach their fans.

Up until now this hasn’t been the case with an artist of consequence, for a few reasons. Younger artists need the structure and nurturing that a music label can provide, and established superstars have usually built up a rapport and are loyal to the group of people — most of whom work for the label — that have helped them become stars and simply choose to stay, after getting a big payday.

. . . .

But what Frank Ocean has done is different. This isn’t going independent while still using a major label for distribution, like Jay Z has done in the past. This is a complete avoidance of the traditional musical hierarchy. Ocean has a young, rabid fanbase that primarily interacts with him online; he doesn’t need to distribute physical copies of albums to thousands of stores like Adele or Taylor Swift. He is part of a small club of superstars who don’t need the label system, and who have the leverage to do deals with streaming services instead of re-signing their contracts. And that’s scary for music labels.

Link to the rest at The Verge and thanks to Will for the tip.

Music Publishing and Book Publishing, different coasts, same story.

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