September 20, 2024 • 49 mins
In another short(er) format episode, we examine Apple’s recent “Glowtime” event. Please do let us know what you think of this new format at LearnMakeLearn@gmail.com or @LearnMakeLearnShow on Threads.
OPENING – 00:00
Suttle Lake
Suttle Lodge
HELP US NAME THIS NEW FORMAT! – 03:12
APPLE’S ‘GLOWTIME’ EVENT – 05:08
Apple Event
The Verge: iPhone 16 event in 16 minutes
John Gruber describes his feelings after the event on Threads
JOACHIM’S TAKE – 05:48
Smartphone innovation is dead, and that’s fine
Revisiting the iPod
Light Phone
ERNEST’S TAKE – 11:07
Made by Google ’24
Steve Jobs introduces “Think Different” (intro to the campaign at 3:05)
Steve Jobs introduces iPhone in 2007 (b-school 101 chart at 3:55)
The Very First ‘Stevenote’
The Glorious Return of a Humble Car Feature
Boomer Apple
RISKS OF SHIFTING TO SERVICES – 27:31
Hilda
Brainchild
Why the Baby-Sitters Club was Cancelled at Netflix
Alexa Is in Millions of Households—and Amazon Is Losing Billions
Steve Jobs: Get Rid Of The Crappy Stuff
Existential thoughts about Apple’s reliance on Services revenue
Jeff Bezos Explains Why Amazon Makes No Profit (2014)
The Birth of an Icon: Susan Kare
Halt and Catch Fire (TV Series)
Drops of God on Apple TV+
Slow Horses on Apple TV+
CLOSING – 49:00
****
Rant, rave or otherwise via email at LearnMakeLearn@gmail.com or on Threads @LearnMakeLearnShow.
CREDITS
Theme: Vendla / Today Is a Good Day / courtesy of www.epidemicsound.com
Drum hit: PREL / Musical Element 85 / courtesy of www.epidemicsound.com
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Ernest (00:04):
Hello.
And welcome to learn.
Make, learn.
Where we share qualitative andquantitative perspectives on
products to help you, make,better.
My name is Ernest Kim, and I'mjoined by my friend and cohost.
Joachim Groeger Hey.
Joachim How's it going?
Joachim (00:19):
I am, I'm gonna be honest, very tired.
Long week, was happy that therewas a weekend, we had a good
weekend, but man, I just, Icould do with another 365 days
of a weekend?
That would make me feel muchbetter.
Like, forget the three dayweekend, just hit me with the
365.
(00:40):
I think I'll be great then.
How about you?
Ernest (00:42):
Yeah, I actually have to admit I'm in a similar boat.
I, I, um, went camping last weekfor the first time this year,
first and probably only timethis year, which was great.
But also, you know, um, I thinkmost people would agree, you
tend not to get great sleep whenyou're out camping.
And, uh, that was certainly thecase for me.
So, um, haven't fully recoveredfrom that yet.
Joachim (01:05):
no wild animals, try and snack on stuff, or was it
pretty, pretty,
Ernest (01:09):
pretty quiet.
I had one little encounter ofsomething in the dark.
I'm not entirely sure what itwas, but overall pretty
uneventful.
But, you know, it really
Joachim (01:21):
sounds very Ernest.
What are you talking?
I just saw something in thedark, but you know, otherwise it
was okay.
Okay.
Ernest (01:29):
walking back to the camp.
It was at this place calledSuttle Lake, which is a
beautiful, lake in centralOregon.
It's about two and a half, twoand a half hours southeast of
Portland.
Um, it's a beautiful location.
I'd highly recommend it ifyou're looking for a place to
camp in Oregon.
Um, and one of the nice thingsabout it is that the
(01:52):
campgrounds, you know, arefantastic.
There's this lake that's closeto all the campgrounds.
And in addition, They have alodge.
So you can book, um,accommodations at the lodge and
they're actually very nice.
It's not, it's not, you know,rustic.
It's actually, they're quitenice, but even if you don't book
at the lodge, um, there's arestaurant at the lodge.
(02:14):
And so if you don't necessarilywant to just completely rough
it, you can go have a meal atthe lodge.
But then the walk back from thelodge to where we were camping.
It's about a mile and, um, you,um, walk along the lake.
Uh, it's a very narrow path andthere's no lighting.
(02:34):
You know, of course, it's just acampground.
So, uh, I was, uh, Kind ofheading back with my headlamp
and I came around the turn andsomething jumped across the path
into the water.
I think, got spooked, spooked byme and I didn't see what it was,
but it was big enough to make areasonable splash.
Uh, so that, that definitelykept things interesting.
Joachim (02:56):
I bet.
I would have just run back tothe lodge and gotten myself a
cocktail at that point.
That would have been my approachto deal with the stress.
Ernest (03:08):
But, uh, you know, I think that's part of the fun of
the camping experience.
Um, kind of jumping into today,this is episode 21, and we're
bringing you another of ourshorter format episodes that we
introduced last week.
Uh, and speaking of which,Joachim, do you have any
thoughts on a name for this newformat?
Joachim (03:27):
I don't know.
Like, last time it was Reckisode, right?
Which, as you said, I thinkthat's great, because we were
talking about recommendations.
But this time it's kind ofreactions.
So I don't know.
It's, you've, we've throwneverything into disarray our
perfect plan and within a weekwe've screwed it up.
(03:49):
Um, I don't know.
Nanosode?
Nanosode?
As a reference to the originaliPod Nano?
I don't know.
I mean, that was a stretchbecause we're going to talk
about apples.
I'm trying to like pretend thatthis was all
Ernest (04:01):
Right.
Right.
Yeah.
Oh, another thought that hadcome to mind for me was off the
cuff just because, uh, we didwant these to be more free form,
but, uh, those are just someepisodes, uh, some ideas on our
end in terms of, uh, what wecall these things, but we, we'd
love to hear what you think.
Uh, if you have any thoughts onthis new format, including
suggestions on what we shouldcall it, please do share your
(04:23):
thoughts with us atLearnMakeLearn@gmail.com or on
Threads@LearnMakeLearnShow, allone word.
We'd really appreciate it.
Joachim (04:33):
I got it.
No, I got it guys.
Don't send in your suggestions.
I'm going to call it theOrnette...
Ornette isode, in honor ofOrnette Coleman of Free Jazz,
and these episodes are kind oflike Free Jazz composi No?
Okay.
I, I think.
Actually, yeah, maybe pleasemake, send your suggestions.
(04:53):
Although I do like Off the Cuff.
Off the Cuff.
Wow.
Well, we'll see.
Maybe someone will come
Ernest (04:59):
yeah, yeah, we're, we're very open to, uh, better ideas.
Uh, so, so please do, uh, sendthem in.
All right, let's, uh, Move on toour topic for today, which is
Apple's quote unquote Glowtimeevent, which took place on
Monday, September 9th.
Uh, I think that's a prettyridiculous name.
(05:20):
So I'll just refer to it fromthis point on as Apple's iPhone
16 launch event.
I know they announced otherthings too, but That was really
the primary reason for theevent.
Um, we'll include a link to thefull video of the keynote, as
well as some of the coverage ofthe event in the show notes, but
this isn't going to be a blow byblow analysis of the event as a
whole.
Instead, we're going to focus onour high level takeaways, uh,
(05:44):
particularly through the lens ofproduct creation and product
strategy.
So with that in mind, Joachim,what did you think of Apple's
iPhone 16 launch event?
Joachim (05:53):
I'm not so sure.
Uh, thinner, thinner, thinnerbezel, lighter, faster charger,
extra button.
Um, it's not a, it's not ashutter button.
It's just an extra button.
Um, I think my tone is alreadygiving away a lot.
But actually, um, I was readingParis Marx's, um, Disconnect
(06:17):
newsletter, which is a very,it's very unabashedly anti tech,
it's very critical of everythingthat's happening in the tech
industry, um, so it, it's avery, When you pick this up, you
know exactly where you're goingto stand.
But Marx, Paris Marx pointed outsomething pretty interesting,
which I hadn't thought about,but I think it captures the
essence of what's going on.
(06:38):
The phone is a utility now,basically it is no longer, um, a
very exciting device to haveused to be iPhone four, iPhone
five, these are pretty bigshifts in.
In our ability to use a phoneand now we're basically spoiled
we have everything that we needthe most of the workflow or the
(07:00):
user flow is very wellestablished rightly or wrongly
right there's there's no reasonto stop innovating but we're
kind of resting on the idea oficons the screen the swipe
gestures have remained prettystatic it's a very well
established product now And soit's, it's a utility.
And I think it feels like Appleis a bit out of step with, with
(07:22):
that.
They haven't quite understoodit, that this is just, it's just
a thing now, you know, youwouldn't have a special event
for something that is anincremental improvement on an
old product.
Um, and when you look at theproduct lineup, it's very.
I mean, there's so many iPhones,right, that 16, the 15 is still
for sale, the 14 is in sale insome form, the SE still exists,
(07:44):
there's so many, so it's acommodity, it is just this thing
that, you know, the newest,highest price one is there for
the people that want it, andthen medium and lower tiers for
everyone else, um, Yes, theApple intelligence thing is
touted as this special feature.
But again, it's one of thosethings that I think is related
(08:05):
to upper tier pricediscrimination.
Get that money from the peoplethat want the new shiny object,
everyone else don't worry aboutit.
I think they were saying, um, Ithink one of the VPs of software
was talking about the fact thatthe iPhone 15's RAM could not
handle a lot of the AIapplications.
So that iPhone 15 is basicallyalready a laggard relative to
(08:26):
the AI technology, and it's apretty good phone still.
I think we've passed this whizbang isn't this exciting kind of
thing.
I mean, we're at 16 now, like,You would have expected the
iPhone numbers to move forwardsin a different way, like some
sort of a different way of, anew nomenclature to suggest a
shift in the way things are.
But the fact that the numbersjust incrementally go up
(08:48):
suggests also it's, it's just autility, you know.
I think maybe it is just time toacknowledge that the phone is a
thing now it's a thing we carryaround and it's now crossed over
to the point of being somethingthat we consider to be an
annoyance.
And to a certain extent, Iwonder if Apple has maybe,
missed a step here I'm verybiased.
But if you think back to how MPthree players were, uh, back in
(09:12):
the day.
The iPod was a little bit, interms of the bells and whistles
that everyone else was throwingonto their mp3 players, was a
pretty pared down, strippeddown, focused product.
Interestingly enough, reallystripped down, but beautifully
made, compelling.
It was a rectangle like everyoneelse's, but it didn't have all
(09:34):
of the complications.
It was very slick and clean,classic Apple.
Um, and so, Part of me wondersif they're missing out on that
next step, which is actuallypeople wanting a straightforward
device that has very littlestuff on it, maybe doesn't even
need to be charged every night.
We've all been conditioned tocharge our devices every night.
What if you had a phone youdidn't have to charge every
(09:54):
night?
Like there are these questionsthat I'm asking myself I mean,
there are products that aredoing that.
Light phone is a good example ofa distraction free phone.
If they made something likethat, I'd be a sucker for that.
I'd go for, you know, a strippeddown, pared down device with a
solid, great screen, minimalapplications, and I could still
use my text messages as always.
So, a bit long winded, but Ithink we've reached a point
(10:17):
where the phone is a utility.
Uh, I don't expect there to bemore stuff coming out of it.
I think Apple needs to just wakeup and stop pushing this as if
it's an exciting event.
I don't think anyone reallycares that much.
Aside from the press, they haveto.
Uh, and aside from people whobuy those expensive items.
But, for those people, I thinkif you just made it expensive,
(10:37):
they would buy it as well.
So, That's kind of my verycynical take on it.
But I, I think there'sopportunity now, I wish there
was a, someone in Apple lookingat what they've done and just
saying, man, this just feelsreally lame and a little
excessive.
The phone prices have beencreeping up.
I mean, every phone, the newphones are a thousand dollars.
I mean, that's a laptop, youknow?
(10:59):
So, um, yeah.
What about you, Ernest?
When, when you were engagingwith that, did you watch the
full stream or did you just readthe
Ernest (11:07):
I, yeah, I did actually watch the full stream, um, and,
uh, I have many similarthoughts.
Some areas where I disagree,actually, um, but, uh, I'll,
I'll talk to it.
I thought I might use kind of a,a bit of a framework of, of, uh,
first talking about the style,just kind of the format.
(11:27):
And then, um, My take on thesubstance and then some thoughts
on potential, you know, whatthis means maybe in terms of
potential strategic shifts forApple.
Um, and that's, uh, where, um, Iget into maybe some thoughts on
pricing too, but, and, you know,feel free to jump in at any
point as well.
But, um, on the style front, onething I'd say is.
(11:51):
I would really stronglyrecommend to Apple that they
move away from this pre recordedformat that they adopted during
the pandemic.
I think, you know, obviouslyduring the pandemic, it made a
lot of sense.
You didn't want to bring a lotof people out to an event.
Um, that would be, you know,become a super spreader event.
Um, so that made a lot of sense,but you know, now that we're Out
(12:13):
of the worst of that and theircompetitors have all moved to in
person events where they'reactually providing live
presentations.
Um, I think it's, well past timefor Apple to come back to that
sort of a live event.
And that, I think there's a fewreasons for that.
At just sort of an emotionallevel, there is this sort of
(12:34):
frisson that comes with a livepresentation that Apple's pre
recorded keynotes justcompletely lack this energy that
they lack.
you know, I actually, um, forthis episode, I went back and
not only watched Apple's event,but also watched, um, Google's a
quote unquote made by Google2024 keynote, aka the pixel nine
launch that was held just abouta month ago.
(12:55):
I went back and watched that andthat event was entirely live and
Google's presenters repeatedlyemphasized the fact that their
product demos were also alllive.
Uh, which was illustrated by oneof the early demos, uh, which
failed repeatedly.
So you can kind of see that itwas truly a live experience.
Um, and the fact that Google'sevent was all happening live,
(13:15):
warts and all gave it a tension,but also just sort of this
pathos that made me connect withit in a way that I just couldn't
connect with Apple's event.
By contrast, Apple's event to mefelt like.
The world's longest, you know,best produced, but also dullest
infomercial.
Um, I, I don't recall Steve Jobsever speaking to this publicly,
(13:38):
but I'm confident that herecognized the importance of
human personification of brands.
That's why the legendary, uh,think different campaign that
reestablished the Apple brandback in 1997, back when the
company was on the verge ofbankruptcy.
That ad featured exactly zeroproducts and instead highlighted
the types of people thatembodied Apple's core values.
(14:01):
Now similarly, when it came toApple's keynote events during
that jobs era, I think herecognized that the audience
needed a human that they couldconnect with and associate with
the brand.
And he was that personification.
He was the storyteller in chief.
He did most of the demos himselfon stage.
You know, of course, not all ofthe events during this era, that
(14:22):
era were stellar, but jobscreated an atmosphere that was
remarkably akin to thatfundamentally human experience
of gathering around the campfireto hear a story.
By comparison, today's Appleevents featured this cavalcade
of presenters, you know, all ofwhom are really talented
presenters, but most of whomsound like they're reading a
(14:44):
script based on a press release.
And it just makes it.
I, I mean, I, in the past Iremember I would, um,
butterflies in my stomach thenight before an Apple event and
I'd have difficulty sleepingbecause I was so looking forward
to it.
And this one, I don't think Iwould've watched it if it
weren't for the fact that wewere planning to talk about it
(15:06):
for this episode.
And when I watched did watch it,I really struggled to keep
watching it.
Um, it really felt likehomework.
Um, so I think that there's alot.
Of opportunity for, uh, Apple onthe style front to get back to
something that, um, just is, youknow, it's not just, uh, a
(15:30):
verbalized press released invideo format and to something
that feels more like a story.
And that gets me to thesubstance.
And, um, here is something thatI've seen Apple, um, fall into
really ever since Steve Jobspassing, which is, um, They seem
(15:51):
to forget the why, you know,this, I think that was one of
the greatest things that jobsdid in his keynotes was that he
made a point of helping us asthe audience understand why they
were doing these things thatthey were doing.
For example, in that originaliPhone launch, that legendary
iPhone launch, one of the keymoments was he shared that sort
(16:14):
of business school 101 chart,the four quadrant chart, where
you have, um, easy to use, uh,on the X axis where, on the far
left, it would have beenproducts that were hard to use.
And then not so smart to smarton the Y axis where not so smart
was on the bottom and smart wason the top.
And he, uh, depicted.
Just traditional dumb phones ason the very bottom of that not
(16:37):
so smart y axis.
And then he depicted all of theexisting smartphones on the kind
of moderately smart level of they axis, but all the way over on
the wrong end of the easy to useaxis.
And you know, that very clearlypainted the picture of This
opportunity, this need for asmartphone that would be truly
smart and truly easy to use, youknow, occupy that upper right
(17:01):
quadrant on that framework.
And that was the why behind theiPhone because nothing like that
existed yet.
So that's why we, you know, madethis commitment to make this
incredible device.
And that was something that Jobsalways did, which I was actually
surprised by because very fewother companies.
ever bothered to do that intheir product launch events
(17:25):
across industries, not justtechnology.
So I've always found that reallyinteresting, um, that jobs made
it made a point of doing that.
And to me, that was a huge partof why Those Steve notes, as
people call them were socompelling, you know, he was, I
think a very good presenter, butalso every story has to have a,
(17:47):
why, right?
No fiction story is ever goingto try to get away with not
explaining the motivation fortheir characters, the why, uh,
and it's, you know, it's thesame when you're talking about a
product as well.
And what I've seen from Apple inrecent, you know, really post
Steve jobs is they just go rightto the what.
(18:09):
You know, it's just, oh, hey,here's this product with X nits
and Y flops and, you know, Z,uh, whatever.
Um, isn't it great because ithas just all these what's to it,
but they never get to the why.
They never really explained whywe're doing this.
And I really found that to bethe case.
There are, there were a coupleof areas where I thought, okay,
(18:32):
that's, that's pretty cool.
Like for example, With the watchand the sleep apnea feature, you
know, they explained that that'sa really, um, common issue.
Um, and so that was somethingthat we wanted to address.
Okay.
That's really compelling or theAirPods pro two and the new
hearing aid functionality.
You know, that too is a reallycompelling feature, but.
(18:52):
For the iPhone presentation andthe iPhone pro, I just felt like
there was never a why it wasjust a series of features of
series of what's without a whyto bring it all together.
So, um, I just feel like that'sa big area of, of opportunity
for Apple when it comes totheir, their, the way they
(19:14):
approach their products.
And I think I suspect this.
Um, is something that exists onthe product creation side of
Apple right now, too, that, um,I suspect that they're at, you
know, in terms of their productbriefing, they're also briefing
at a very feature level.
Um, and so that's, that's.
(19:37):
Carrying over into theirstorytelling as well.
And I think it would really, youknow, to your point, uh, help
them get to a more compellingplace if they really started
with the Y and that might leadthem to actually take some
features away.
Um, which is, you know, what youwere speaking to just a minute
ago.
It doesn't seem that they'redoing that.
(19:57):
They're really stuck in thissort of speeds and feeds
approach to product marketing,which is something that Steve
jobs really.
Derided, you know, that that wassomething that all the
competitors did, but Applewasn't about speeds and feeds.
It was about getting at the why.
Um, The one substantive thingthat I thought was interesting
was you mentioned the, thecapture button that was kind of
(20:21):
probably the key new feature,hardware feature on the devices.
Uh, and I thought that wasinteresting in a couple of ways.
One was it represented thiscontinued move away from, What I
think a lot of people assumedApple was trying to move to,
which was this fully sealeddevice when, um, Apple
eliminated the headphone jack.
(20:42):
I think a lot of people tookthat as a signal that Apple's
goal was to get to this fullysealed device with no moving
bits.
You know, you'd probably befully, uh, reliant on wireless
charging any buttons on, youknow, the volume buttons would
be, um, haptic and not actually,uh, you know, move at all.
But instead, uh, last year theyintroduced the action button,
(21:04):
uh, which was a physical buttonon the devices.
And then now this year they'veintroduced the capture button.
So I, I feel like that's aninteresting move away from, um,
the direction they seem to havebeen heading.
And, uh, I hope this issomething that we see copied
more broadly and particularly inthe automotive world where I
think, the automotive players,many of them followed Tesla you
(21:27):
know, in this direction oftaking away all buttons, which I
think is a, cue they took fromApple as well.
I think a lot of folks who ownthose types of cars, you hate
that experience,, hate having tohunt for buttons.
So, um, I hope that folks inother industries will take this
as a cue that, Hey, just thisfuture of buttonless devices is
(21:52):
not a great future.
And so let's, uh, you know,maybe bring back buttons where
they're warranted.
Another.
Thing that I thought wasinteresting about the capture
button, which kind of gets intostrategy.
What is the fact that thecapture button is offered on all
versions of the iPhone 16.
This is a really big differencefrom Apple's recent history
where when they've introduced anew feature, it would always be
(22:14):
introduced in the pro models,which would be kind of one
vector for differentiation ofbetween the pro and non pro
models.
Whereas this year, the capturebutton, which is kind of the key
feature is being made availableacross the board.
Uh, whereas, again, the actionbutton was introduced only on
the iPhone 15 pro models lastyear.
(22:35):
The standard iPhone 16 isgetting it for the first time,
but they're all the standardiPhone 16 models are also
getting that capture button.
And yeah, I think that reflectsa bit of a shift on Apple's part
where in recent years they havebeen trying to push consumers
into those higher price tiers ofthe pro models by, you know,
(22:57):
offering these new features thatwere only available on the pro
models.
But, you know, I may be readingtoo much into it, but I think
this addition of the capturebutton across the line suggests
that, um, they're trying to, um,broaden access to, you know,
They're most compelling featureswith the recognition that, um,
(23:23):
they services are really wheretheir future lies in terms of
revenue growth.
Um, because yes, I would agreethat the phones are kind of
insanely expensive, like the prophones, like you mentioned over
a thousand dollars for thebiggest phone, but they've
actually held on their pricingsince last year.
(23:44):
And if you consider inflation,pricing of the iPhones have
actually declined over the pastfew years.
And I, I have to imagine thatthat's not an accident, you
know, that there is a bit of ashift on Apple's part
recognizing that, you know,maybe they're willing to take a
little bit less of a margin onthe hardware so that they can
(24:07):
expand the pool of people, um,who they can address, uh,
through their services.
Where they have an even biggermargin.
Um, and, where they, I think areseeing a bigger growth
opportunity.
The site Stratechery, which somefolks may be familiar with.
Um, the author there recentlyposted an article about that
(24:28):
with some similar thoughts andI'll, I'll post a link to that
in the show notes.
Um, so that's one thought into,in the strategy front.
One other thing that, I kind oftook away from this and I don't
know if this was intentional ornot, but was the seeming
transition from a kind of brandstrategy perspective of Apple
(24:50):
from this company that used torepresent like magic and wonder,
right?
Like that was one of the thingsthat made Steve Jobs keynotes.
So compelling was it just, you,you felt like every
presentation, you You'd be wowedand you'd be blown away by
something that you'd never seenbefore.
And it seems like, you mentionedthis as well, Joachim, that they
(25:12):
seem to be shifting into thisutility mode.
They use the word indispensable,um, a few times.
They want to be this sort ofindispensable utility.
Um, so it does seem like thereis this shift away from the
company of magic and wonder tothis company of indispensable
utility.
One big.
(25:32):
expression of that is theirfocus on health.
And I wondered whether theymight also be seeing health as
one, a compelling, um, productopportunity, but also
potentially an opportunity to,um, be able to draw subsidies
(25:53):
for their hardware, uh, viaInsurance providers and
government, um, health providersin a similar way that they've
been able to draw subsidies ontheir phones from carriers
around the world.
Which for them would be a greatmodel, right?
I'm sure they'd love to be ableto replicate that phone subsidy
model, um, across more of theirproducts.
(26:13):
So those are two interestingthings that kind of struck me
from a strategy perspective, butI'd say overall, I think like
you, I was pretty disappointed.
I would agree a lot of people.
I've, a lot of coverage.
I've heard some of the techfolks say, this sentiment that
it was disappointing isridiculous because, um, the, the
point isn't to get people toreplace their phones every year.
(26:36):
So it's, this was really gearedtowards people who have an
iPhone 14 or even a 13 or 12.
And you know, yes, that's true.
You shouldn't be replacing yourphone every year.
That's silly.
And yet I do think thatHistorically, big part of the
Apple brand was bringing wonderinto the world.
Uh, and you know, they even havedevices called magic, magic
(26:57):
track pad and magic keyboard.
Um, and it seems like they've,they certainly didn't deliver
that this year with thisannouncement.
Um, and whether it's a signalof, uh, a broader shift or it's
just, an off year, um, it's not,not clear, but to me, if you
look at some of the recent,year's keynotes, I do see a
(27:21):
broader shift.
maybe this is a more of a dipthan usual, but I do think that
it's, it's one in a series ofsignals that points to a broader
shift.
Joachim (27:31):
Oh man, there's a lot to go over there.
What you were linking to is theidea that this, this company is
trying to become indispensableand they want to, they want to
do everything and they want tobe a service provider for
everything.
and hardware becomes the vehicleto provide those services.
Apple wants to become a platformvery much like, Netflix, Amazon,
(27:53):
but they have this hardwarething.
thing.
that allows them to basicallypopulate that hardware with all
of their stuff.
So cloud storage, forget aDropbox, like iPhone.
You want to have an iPhone, youhave it sync up nicely.
Just use the cloud storage,iCloud.
Messages, movies.
I mean, they're really trying tocontrol that ecosystem.
(28:14):
And they have the hardware to beable to control exactly what
shows up on there.
We've all become veryconditioned to believe that
platforms are these magic moneymaking machines that can just
get subscription fees, and thenthat's that.
Apple already has a combinedsubscription program for its
cloud, its news, its music, andmovies, and fitness, all sitting
under one umbrella.
(28:36):
And when I see that,, as aperson who worries about how
platforms structure themselves,I basically see the end.
What's going to happen inside ofthis company is that decision
making is going to becomeincredibly difficult.
You are going to have to startconstructing attribution logic
inside of your own company todecide who is generating value
(28:58):
for your company.
So for example, if you have onesubscription program that covers
everything and, Let's say thecloud program decides to get to
make some crazy coolimprovement.
How will you justify theinvestment in that cloud storage
program?
Well, they'll have to come upwith some exotic description of
how, well, I got the cloud thingand because the cloud's better,
(29:19):
people are subscribing more.
And because they are increasingthe chances they're going to
subscribe, I, I earned, youknow, a fraction of that
subscription revenue.
And that's,, my contribution tothe bottom line in Apple.
And then, well, health will say,no, we got these new trainers
and this new program and that'sgoing to prevent, that's going
to keep people, re upping theirsubscriptions.
(29:39):
And we actually, 20 percentresponsible for those
subscription fees.
So we take 20 percent of therevenue every time and so on and
so forth.
And.
What that leads to is just thisbizarre synthetic bean counting.
Like it's not real money.
You don't even know who'sgenerating value anymore.
Uh, and Apple's business hasbeen traditionally in hardware.
(30:02):
Like here's a thing, we make it,there's margin on it.
And you sell it.
It's cost of goods, this is theprice, and that's that.
You push into these subscriptionthings, you're going to start
unraveling the whole strategy ofthe company, and you're going to
start creating this incrediblyambiguous and hard to manage
platform system.
Now, Netflix will claim theyfigured it all out and
(30:23):
everything's fine.
I sincerely, sincerely doubtthat.
The level of precision you wouldneed to be able to put onto
these numbers is ridiculous andnigh on impossible.
So you'd have to be able to say,hey, should we buy a season of
Some TV show.
Should we add another season ofsomething?
Let's take something reallystupid that no one cares about,
(30:43):
like Hilda, which is a kidsshow.
Absolutely brilliant.
I love it.
Everyone should watch it.
A little recommendation inthere.
I wouldn't mind watching anotherseason of that.
So it's going to cost someamount of money to do that.
How do we know that makes sense?
Well, you have to say, well, theprobability that everyone's
going to renew theirsubscription because of the
presence of Hilda is this thing.
How will you know that ifthere's also a thousand other
(31:04):
things that are coming down thepipe and they're going to come
into the system, everything isinfluencing everything else.
And no person is giving you aclean signal that the reason why
they're subscribing is becauseof this specific piece of
content.
You're going to have to infer itfrom their viewing behavior.
So everything's in the top 10.
It's all the same.
I'm going to look at everything.
I mean, it's all noise at thatpoint.
We're all watching the samestuff on Netflix because they're
(31:25):
pushing the same things onthere.
So for them to dis unpickexactly what contributed and
created value.
That's the problem.
That's why they couldn't extractmore out of their movie making
business, TV show makingbusiness, because they didn't
know what to buy.
They just did everything likeevery other TV channel.
Did 20 30 years ago.
Like, their content strategy wasthe same as it's always been.
There was nothing new.
(31:45):
The data doesn't give youanything.
Um, and if they had used theirbrains, there were a lot of
shows that really suffered.
Um, a lot of brilliant shows.
There was a show that actuallyPharrell produced called
Brainchild.
It only got one season.
It's a kids science program.
And allegedly, one of the bigmetrics inside of Netflix is
bingeability.
Now, Brainchild is a children'sshow.
(32:09):
Children have time limits.
We place time limits on theviewing habits of our children.
So, you can't just look at hoursconsumed to figure out if this
is a good show for children.
You have to construct Anunderstanding of how a child
consumes something and how thatgenerates a future path of
attachment to the platform,which is really hard to pick up,
to capture.
They, they never get anotherseason.
My son, every three months willwatch the whole season again and
(32:33):
is always sad that he can'twatch more.
No one is listening.
No one has said, oh, by the way,we can quickly knock out another
season.
Like, none of that fancy tech,we figured out all this deep
stuff about human needs.
It's all noise.
It's all nonsense.
So I think the danger is whenyou start creating these
packages and these problems,you're going to have to start
parceling out exactly who getscredit for what.
(32:55):
It's terrible.
So to add the last bit of icingon the cake to make it feel
very, very grounded, the wallstreet journal published an
article last month aboutAmazon's device business.
The device business was designedto get Alexa at everyone's home
and they were going to heavily,heavily subsidize the devices.
And the way they were going tojustify the investment of those
(33:16):
devices was to say that therewas this downstream impact.
DSI.
It was basically.
A system of equations thatallowed you to get some number
around what the downstreamimpact is from your thing.
And the right way they did islike, you used my service, which
I care about as a product ownerinside of Amazon, and then I'm
going to claim this chain ofevents that happens downstream
(33:38):
from where I am.
So if you started buying morestuff because you had an Alexa
and you're ordering on the,like, I'll take credit for that.
But guess what?
Someone was upstream from you.
They're probably going to takecredit for everything that
happens downstream from you aswell.
And someone's downstream fromyou is taking care.
So basically the joke was alwaysthat if you added up everyone's
downstream impact, Amazon wasgoing to be like a thousand
(33:58):
trillion dollar company.
Like it was, it was, the numbersdidn't add up the wall street
journal points article pointsout that this was one of the
main reasons why the device isbusiness.
fell down and lost, you know,billions of dollars because
there was no real money comingin.
It was just all attributed viathese other money generating
things.
The only way you'd ever be ableto identify truly realistically,
(34:21):
if this business made money andactually generated more revenue
is if you had another Amazonwithout the devices business.
And then you measured what wouldhappen in the exact, so parallel
world.
Like that's, that's what theimpossibility is.
And I love models.
I love math.
And I love to believe thatthere's a way to get closer to
that number.
And I always will try and dothat, but don't get yourself
(34:43):
into that mess.
At Apple, I think this is what'sgoing to happen.
You know, someone's going tohave to say, well, we need to
figure out how to attribute thisand blob.
We need machine learning and AI,and you just get this overhead.
When it was simple, this thing,that's the profit and you move
on.
They have to be careful becausethere is a real, real risk here
that you start destroying theability to make good, well
(35:05):
founded.
tethered decisions.
And you're going to start hopingthat you can convince the stock
market that there's some magicat the end of the tunnel.
And partly my cynicalperspective is this is why
Netflix has entered into theadvertising business.
Like what else are they going todo?
They're not going to get moreefficient.
They're not going to get smarterwith the way they decide.
What to do and how to findstuff.
They're just going to sell youreyeballs now.
(35:27):
And the only way this progressesis that they start working their
way through all of the tiersuntil there's only a hundred
dollar a month tier that haszero ads.
And the rest are all somemodulation of different
variations of that.
I mean, that's, that's.
It's going to slowly happen.
We're all just on the cooker.
It's just always works its wayfrom the bottom up.
It's terrible.
You know, they, they got peopleoff the lowest ad free tier.
(35:48):
They just said that tears goneguys, bye.
You just have to watch ads now.
I'm like, okay.
And then of course, then Netflixcan say, look at the audience
that we have that watch ads andlike, yeah, you forced everyone
to watch them.
So the platform business seemsgreat.
It's good for the market, forthe stock market.
I don't know how sustainable itis.
I mean, Tim Cook's going to getpaid.
He's going to cash out.
Everyone's going to cash out.
It's going to be fine, but thecompany and the legacy and the
(36:10):
employees that are just joiningand see a future at that
company.
I don't know.
I feel bad that if this is thedirection that they want to push
into, it gets very, very.
tricky and hard to justify whyyou're doing what you're doing.
Um, it's not clean anymore, itbecomes political.
So, yeah, that was, sorry, thatwas a very long excursion into
that strategy piece that youwere
Ernest (36:31):
Yeah, no, no,
Joachim (36:33):
yeah, but it, it, it was on my mind, yeah, as you
were talking.
Ernest (36:36):
I, that's something I've, I'm really torn about
because I definitely agree.
I, you know, I remember whenSteve Jobs came back to Apple,
he was so proud of talking aboutthe fact that you could fit all
of their products on one tableand you know, it was such a
clean, beautifully simplebusiness and it led to this very
Clear relationship between Appleand its customers.
(37:00):
Um, and yeah, I really do thinkthere's beauty to that.
You could see where the valuewas and to your point, it's now
so muddled and murky, um, andyeah, Apple is such a different
company now where you mentionedthat iPhone lineup itself is
just, there's so many productsin just that line alone.
(37:21):
They're still selling the the 15and the 14 and SE, uh, and, even
though obviously those aren'tgoing to deliver the best
experience that Apple candeliver.
and yet what, you know, on theopposite side of that, what
makes, gives me some pause isthe recognition that, all right,
(37:44):
let's, this is predicated on theassumption that we're going to
accept capitalism and, andaccept that as a, uh, public
company Apple has to, has to, Todeliver continued growth.
So I think you could make areally good argument that maybe
we should reevaluate that, butlet's say, you know, we're going
to accept those that Apple can'tcontinue to deliver growth
(38:08):
through hardware sales alone,it's.
It's I think just impossible.
Um, they could try to enter newcategories, but there certainly
wouldn't be possible to do thatand also deliver on their
sustainability goals, which, youknow, I think are vital for all
of humanity.
So if you, if you accept thoseassumptions, then I think you
(38:31):
know, you, Come to theconclusion that yet they do have
to find new, um, revenueopportunities.
And so, you know, it just feelslike services does seem like a
pretty obvious mechanism todrive that continued revenue
growth without putting morephysical, um, bits, atoms out
(38:53):
into the world, right?
That's, why I see it from bothsides that I, I do think today's
Apple is just, it's not acompany that's as easy to love
as it used to be.
And to your point, I think fromthe back end as well, it's gotta
be an incredibly difficult thingto manage and to try to
understand.
and yet I do see why they'redoing what they're doing
(39:15):
because.
Absent this services revenue,Apple would be really battered
by Wall Street because theywouldn't be delivering the
growth that Wall Street expectsthem to continue to deliver.
So,, I think it is a challengingsituation.
Joachim (39:31):
Oh, I agree.
I agree.
If you want to do the platformbusiness, you have to design it
from the ground up to be a thingthat still has the discipline of
what you would call atraditional profitable business
with costs and revenues.
You would have to actually havea clear communication pathway
between the customers and.
(39:52):
The actual service.
I mean, that's the thing that, Ididn't say it directly, but
really what it is, why is thehardware business so clear?
you buy the thing and that's thetransaction it's done.
A service has a subscriptionpath.
It has many components to it.
It's very clumpy and it's hardto tell what it is that a person
is actually enjoying about theservice because everything is
lumped under these umbrellas,even Apple news is a set of
(40:15):
things.
it's not one thing.
It's not even one article.
When I'm thinking about platformdesign, you have to think about
this as a communication protocolbetween my customers and the
service, and I need to defineways of getting in the fidelity
of communication so that I canalso understand what they're
valuing.
The buzzword you can use, Ithink it's, it's It's overused
(40:36):
and it's mis it's abused, butmicrotransactions is a way of
getting at this idea that I wantto be able to signal to the, to,
to the platform what I'm valuingin this moment.
And it shouldn't be thisindirect inferential process
that the company has to gothrough.
to justify and understand whatthe user is doing.
it's ridiculous.
That's why we have thistechnology is that you can tell,
(40:56):
I can tell you what I want, youknow, I find it so stupid that
we're locked in thesesubscription walls, but of
course, it's part of the, it'sthe old paradigm.
It's, and that's the thing thatI think is very, Sad.
I, I think that's the thingthat's interesting is that Apple
has not applied its way ofthinking to the services model.
(41:16):
They're just replicating what'sexisted.
And that's so lame, right?
That goes against the wholeethos of what Apple's doing.
If they wanted to do it, theycould do it.
They have the brains.
I think they just need to beopen to that.
But again, it means that youhave to educate the market.
You have to educate wall street.
You have to tell them it's goingto be some rough time.
We're going to do some crazystuff and we're going to try
things out.
But that's the problem.
(41:37):
I think Tim Cook is just a, andeveryone right now is just so
conservative and they just wantto.
You know, cash out and ride,ride the wave as long as they
can.
And who cares about the futureof the company?
it's a shame because, it neednot be that way.
I think that's always what Ifind so frustrating is like the
business model need not operatethat way.
Yes.
You need growth.
You need all these things topacify the market..
(42:00):
I mean, Bezos did that back inthe day.
He said, you, you, you want thething and I'm not going to give
it to you.
This is the business that you'reinvesting in.
No profits for a long time.
And they were like, okay, fine.
We'll, we'll keep buying thestock and holding onto it, you
know?
Um, so there is a way you justhave to set the tone.
And, uh, and like you said, itbecomes more of a human
(42:22):
conversation, right?
It's this Steve Jobs with thispersona that it was kind of the
human fleshy embodiment ofApple, um, rightly or wrongly,
right?
Of course it's this huge thing,but I think that was something
that you said at the beginningis the humanity that was there
always, and the product was sucha big piece of what they were
doing.
And you felt a connection to, toApple, which makes me think
(42:46):
about the first, like the happyMac.
Ernest (42:48):
Yeah.
Joachim (42:49):
that Susan Kerr designed, which is just that
original Mac and a little smileyface on it.
And it's just absolutelyincredible.
which also reminds me of thatscene in Halt and Catch Fire in
the first season they go toComdex and our, the main
character that we've beenfollowing who's kind of a Steve
Jobs guy, Lee Pace's character,Joe McMillan, he's in the room
when they switch on the, theApple Macintosh.
(43:11):
Joe McMillan's he's mesmerized,and, and then, someone types in
some words and it's voicesynthesizer works.
And Macmillan can only say liketalks and it's, it's the
humanity in it, right?
Everything was so human.
Uh, and I think, yeah, yourplatform business can be, you
just have to.
design it from the ground up tobe that way.
(43:32):
It's more work.
Why don't you now do somethingthat is actually radically
different and, and pushes theboundaries of how people run
these businesses.
I think it's a shame thatthey're so conservative about
this stuff, but
Ernest (43:45):
No, to that point, I think, you know, you gave that
example of the show that yourson loves.
Um, was it brainchild
Joachim (43:52):
brainchild.
Ernest (43:53):
Netflix?
Yeah.
I would, in terms of our, whatcould you do about it as say a
product manager, I would justhope, that you as a.
product manager at Netflix.
I would assume they must have,product managers for kids
content.
I'm not sure how they organizetheir product groups, but, um,
let's assume that they do that.
(44:14):
Part of what you could do isadvocate for a different set of
KPIs for your kids content,because to your point, kids have
guardrails around how muchthey're able to watch you if
you're a good parent, right?
So we need to judge our kidscontent with a different set of.
KPIs, let's say, then we do ouradult content.
(44:35):
So helping your leadersunderstand that, there's a
different lens for success thatwe need to look at this through
so that we can help, thosefolks, uh, in leadership
positions.
Then apply judgment in a morethoughtful way.
Hopefully, you know, as, as justin terms of like, as a, what can
we do as a product manager levelperson to affect change in a
(44:57):
positive direction?
I guess that'd be one thing thatcomes to mind.
Joachim (45:00):
I think the trap that you can fall into, well, let me
put it this way, an engineeringor software engineering mindset
flattens a lot of the complexityof the problem by necessity,
because they're going to try andbuild a system that does stuff.
But like that example of themillion checkboxes does, you can
create this very flatenvironment that these very deep
behaviors emerge.
And in entertainment, those deepthings are there, that they're
(45:22):
in the data somewhere, but it'sbecause you've decided to
flatten it into a KPI of somekind that things are wrong.
You have to always represent thepath, that story of Who's doing
what at what time, and how doyou see that flow of activities
contributing to an overall, uh,attachment to the platform you
have to find ways to open upthat communication pathway from
(45:43):
the customer to your platform.
Whatever it is, hardware,software, it's the same thing.
One of my other jobs, was atraditional game studio, triple
A game studio, that wouldrelease a game with a huge
marketing blitz, and they wouldsell, they would make an
(46:04):
enormous amount of money.
And then that's it.
One and done.
And then get ready for the nextone when, when you've got the
energy again to, to make a newgame.
And it was a very, very cleantransaction.
But the business that they're inright now is a live game system
and that's an always on service,right?
Where people are not buying thegame and not expressing an
interest.
They express attachment bybuying cosmetic items.
(46:26):
So you're kind of back in thatweird, like, inferential process
of trying to figure out, didthey like the game still?
Buying these cosmetics?
Did this game make them want tobuy the cosmetics?
Like, are they just buying thecosmetics because it is Star
Wars and it's so attractive?
You know, it gets complicatedand um, the company has to shift
its mindset to adapt to that wayof thinking.
(46:49):
When before it was very clear,Get those discs into the shops,
put them into a prominentposition, they will sell, and,
and, even if they hate the game,this is the thing I think
people, even if they hate thegame, you will still make money.
But in a live serviceenvironment, that's not the
case.
I think that's the problem withthe entertainment industry in
general, is that they've, the,the transactions changed, you
(47:09):
know, it's now become much moreof a, a slower burn, things are
indirect and hard to unpick,
Ernest (47:18):
right, right, kind of getting to that point of
understanding that why, why arethey doing these things that
they're doing, and to your pointthat it Starts to get very
muddied when you have these,rolled up services that are
doing a lot of different thingsat once.
I like, for example, I have noidea why Apple does Apple TV
plus.
It just baffles me.
Joachim (47:39):
Yeah.
Ernest (47:40):
Uh, it's
Joachim (47:40):
I mean, yes.
Why are you making movies?
They make so many movies aswell.
I don't get it.
Ernest (47:46):
Yeah.
That's a really, I'd love tohelp one day.
Somebody tells the backstory tothat one because, um, that'd be
really interesting to learn moreabout that.
Uh, speaking of Apple TV Plusthough, there's a series called
Drops of God.
It's based on a, it's based on amanga.
Uh, And it, you would, youwouldn't know it existed like
(48:08):
Apple has done absolutely zeropromotion for it, which is just
so sad, but it's just absolutelygorgeous.
It's, um, a little bit, uh, youknow, it's an adaptation.
So it's a little bit differentfrom the source material.
Uh, one big change is that muchof it is set in France, although
there is still a big component,um, in Japan as well.
Beautiful, beautifully shot,really beautifully written and
(48:30):
acted.
Um, so that would be one goodthing on Apple TV plus I'd
recommend.
I'm also a slow horses fan, but,um, yeah, there's a few, few
gems on there.
Joachim (48:41):
heard.
Slow horses is definitely one ofthe really good shows.
It's ridiculous.
I mean, Gary Oldman isdisgusting in that.
So it is, it is always a treatto see how far he can push, push
that acceptable behavior onscreen.
Yeah.
Ernest (49:00):
All right.
Well, we've kind of veered intorecommendation territory, but, I
think we had a good conversationabout, uh, the Apple event as
well.
Um, now, as I mentioned earlier,we want to hear from you.
Do you agree or disagree withour takes on Apple's iPhone 16
event?
What do you think of this newepisode format?
And as we asked earlier, do youhave any suggestions on what we
(49:21):
should call this new format?
We want to hear from you.
So please share your thoughts atLearnMakeLearn@gmail.Com or on
threads at LearnMakeLearnShow,all one word.
Thanks for listening and we hopeyou'll join us for the next
Learn Make Learn.
Hello.
And welcome to learn.
Make, learn.
Where we share qualitative andquantitative perspectives on
products to help you, make,better.
My name is Ernest Kim, and I'mjoined by my friend and cohost.
Joachim Groeger Hey.
Joachim How's it going?
Joachim (00:19):
I am, I'm gonna be honest, very tired.
Long week, was happy that therewas a weekend, we had a good
weekend, but man, I just, Icould do with another 365 days
of a weekend?
That would make me feel muchbetter.
Like, forget the three dayweekend, just hit me with the
365.
(00:40):
I think I'll be great then.
How about you?
Ernest (00:42):
Yeah, I actually have to admit I'm in a similar boat.
I, I, um, went camping last weekfor the first time this year,
first and probably only timethis year, which was great.
But also, you know, um, I thinkmost people would agree, you
tend not to get great sleep whenyou're out camping.
And, uh, that was certainly thecase for me.
So, um, haven't fully recoveredfrom that yet.
Joachim (01:05):
no wild animals, try and snack on stuff, or was it
pretty, pretty,
Ernest (01:09):
pretty quiet.
I had one little encounter ofsomething in the dark.
I'm not entirely sure what itwas, but overall pretty
uneventful.
But, you know, it really
Joachim (01:21):
sounds very Ernest.
What are you talking?
I just saw something in thedark, but you know, otherwise it
was okay.
Okay.
Ernest (01:29):
walking back to the camp.
It was at this place calledSuttle Lake, which is a
beautiful, lake in centralOregon.
It's about two and a half, twoand a half hours southeast of
Portland.
Um, it's a beautiful location.
I'd highly recommend it ifyou're looking for a place to
camp in Oregon.
Um, and one of the nice thingsabout it is that the
(01:52):
campgrounds, you know, arefantastic.
There's this lake that's closeto all the campgrounds.
And in addition, They have alodge.
So you can book, um,accommodations at the lodge and
they're actually very nice.
It's not, it's not, you know,rustic.
It's actually, they're quitenice, but even if you don't book
at the lodge, um, there's arestaurant at the lodge.
(02:14):
And so if you don't necessarilywant to just completely rough
it, you can go have a meal atthe lodge.
But then the walk back from thelodge to where we were camping.
It's about a mile and, um, you,um, walk along the lake.
Uh, it's a very narrow path andthere's no lighting.
(02:34):
You know, of course, it's just acampground.
So, uh, I was, uh, Kind ofheading back with my headlamp
and I came around the turn andsomething jumped across the path
into the water.
I think, got spooked, spooked byme and I didn't see what it was,
but it was big enough to make areasonable splash.
Uh, so that, that definitelykept things interesting.
Joachim (02:56):
I bet.
I would have just run back tothe lodge and gotten myself a
cocktail at that point.
That would have been my approachto deal with the stress.
Ernest (03:08):
But, uh, you know, I think that's part of the fun of
the camping experience.
Um, kind of jumping into today,this is episode 21, and we're
bringing you another of ourshorter format episodes that we
introduced last week.
Uh, and speaking of which,Joachim, do you have any
thoughts on a name for this newformat?
Joachim (03:27):
I don't know.
Like, last time it was Reckisode, right?
Which, as you said, I thinkthat's great, because we were
talking about recommendations.
But this time it's kind ofreactions.
So I don't know.
It's, you've, we've throwneverything into disarray our
perfect plan and within a weekwe've screwed it up.
(03:49):
Um, I don't know.
Nanosode?
Nanosode?
As a reference to the originaliPod Nano?
I don't know.
I mean, that was a stretchbecause we're going to talk
about apples.
I'm trying to like pretend thatthis was all
Ernest (04:01):
Right.
Right.
Yeah.
Oh, another thought that hadcome to mind for me was off the
cuff just because, uh, we didwant these to be more free form,
but, uh, those are just someepisodes, uh, some ideas on our
end in terms of, uh, what wecall these things, but we, we'd
love to hear what you think.
Uh, if you have any thoughts onthis new format, including
suggestions on what we shouldcall it, please do share your
(04:23):
thoughts with us atLearnMakeLearn@gmail.com or on
Threads@LearnMakeLearnShow, allone word.
We'd really appreciate it.
Joachim (04:33):
I got it.
No, I got it guys.
Don't send in your suggestions.
I'm going to call it theOrnette...
Ornette isode, in honor ofOrnette Coleman of Free Jazz,
and these episodes are kind oflike Free Jazz composi No?
Okay.
I, I think.
Actually, yeah, maybe pleasemake, send your suggestions.
(04:53):
Although I do like Off the Cuff.
Off the Cuff.
Wow.
Well, we'll see.
Maybe someone will come
Ernest (04:59):
yeah, yeah, we're, we're very open to, uh, better ideas.
Uh, so, so please do, uh, sendthem in.
All right, let's, uh, Move on toour topic for today, which is
Apple's quote unquote Glowtimeevent, which took place on
Monday, September 9th.
Uh, I think that's a prettyridiculous name.
(05:20):
So I'll just refer to it fromthis point on as Apple's iPhone
16 launch event.
I know they announced otherthings too, but That was really
the primary reason for theevent.
Um, we'll include a link to thefull video of the keynote, as
well as some of the coverage ofthe event in the show notes, but
this isn't going to be a blow byblow analysis of the event as a
whole.
Instead, we're going to focus onour high level takeaways, uh,
(05:44):
particularly through the lens ofproduct creation and product
strategy.
So with that in mind, Joachim,what did you think of Apple's
iPhone 16 launch event?
Joachim (05:53):
I'm not so sure.
Uh, thinner, thinner, thinnerbezel, lighter, faster charger,
extra button.
Um, it's not a, it's not ashutter button.
It's just an extra button.
Um, I think my tone is alreadygiving away a lot.
But actually, um, I was readingParis Marx's, um, Disconnect
(06:17):
newsletter, which is a very,it's very unabashedly anti tech,
it's very critical of everythingthat's happening in the tech
industry, um, so it, it's avery, When you pick this up, you
know exactly where you're goingto stand.
But Marx, Paris Marx pointed outsomething pretty interesting,
which I hadn't thought about,but I think it captures the
essence of what's going on.
(06:38):
The phone is a utility now,basically it is no longer, um, a
very exciting device to haveused to be iPhone four, iPhone
five, these are pretty bigshifts in.
In our ability to use a phoneand now we're basically spoiled
we have everything that we needthe most of the workflow or the
(07:00):
user flow is very wellestablished rightly or wrongly
right there's there's no reasonto stop innovating but we're
kind of resting on the idea oficons the screen the swipe
gestures have remained prettystatic it's a very well
established product now And soit's, it's a utility.
And I think it feels like Appleis a bit out of step with, with
(07:22):
that.
They haven't quite understoodit, that this is just, it's just
a thing now, you know, youwouldn't have a special event
for something that is anincremental improvement on an
old product.
Um, and when you look at theproduct lineup, it's very.
I mean, there's so many iPhones,right, that 16, the 15 is still
for sale, the 14 is in sale insome form, the SE still exists,
(07:44):
there's so many, so it's acommodity, it is just this thing
that, you know, the newest,highest price one is there for
the people that want it, andthen medium and lower tiers for
everyone else, um, Yes, theApple intelligence thing is
touted as this special feature.
But again, it's one of thosethings that I think is related
(08:05):
to upper tier pricediscrimination.
Get that money from the peoplethat want the new shiny object,
everyone else don't worry aboutit.
I think they were saying, um, Ithink one of the VPs of software
was talking about the fact thatthe iPhone 15's RAM could not
handle a lot of the AIapplications.
So that iPhone 15 is basicallyalready a laggard relative to
(08:26):
the AI technology, and it's apretty good phone still.
I think we've passed this whizbang isn't this exciting kind of
thing.
I mean, we're at 16 now, like,You would have expected the
iPhone numbers to move forwardsin a different way, like some
sort of a different way of, anew nomenclature to suggest a
shift in the way things are.
But the fact that the numbersjust incrementally go up
(08:48):
suggests also it's, it's just autility, you know.
I think maybe it is just time toacknowledge that the phone is a
thing now it's a thing we carryaround and it's now crossed over
to the point of being somethingthat we consider to be an
annoyance.
And to a certain extent, Iwonder if Apple has maybe,
missed a step here I'm verybiased.
But if you think back to how MPthree players were, uh, back in
(09:12):
the day.
The iPod was a little bit, interms of the bells and whistles
that everyone else was throwingonto their mp3 players, was a
pretty pared down, strippeddown, focused product.
Interestingly enough, reallystripped down, but beautifully
made, compelling.
It was a rectangle like everyoneelse's, but it didn't have all
(09:34):
of the complications.
It was very slick and clean,classic Apple.
Um, and so, Part of me wondersif they're missing out on that
next step, which is actuallypeople wanting a straightforward
device that has very littlestuff on it, maybe doesn't even
need to be charged every night.
We've all been conditioned tocharge our devices every night.
What if you had a phone youdidn't have to charge every
(09:54):
night?
Like there are these questionsthat I'm asking myself I mean,
there are products that aredoing that.
Light phone is a good example ofa distraction free phone.
If they made something likethat, I'd be a sucker for that.
I'd go for, you know, a strippeddown, pared down device with a
solid, great screen, minimalapplications, and I could still
use my text messages as always.
So, a bit long winded, but Ithink we've reached a point
(10:17):
where the phone is a utility.
Uh, I don't expect there to bemore stuff coming out of it.
I think Apple needs to just wakeup and stop pushing this as if
it's an exciting event.
I don't think anyone reallycares that much.
Aside from the press, they haveto.
Uh, and aside from people whobuy those expensive items.
But, for those people, I thinkif you just made it expensive,
(10:37):
they would buy it as well.
So, That's kind of my verycynical take on it.
But I, I think there'sopportunity now, I wish there
was a, someone in Apple lookingat what they've done and just
saying, man, this just feelsreally lame and a little
excessive.
The phone prices have beencreeping up.
I mean, every phone, the newphones are a thousand dollars.
I mean, that's a laptop, youknow?
(10:59):
So, um, yeah.
What about you, Ernest?
When, when you were engagingwith that, did you watch the
full stream or did you just readthe
Ernest (11:07):
I, yeah, I did actually watch the full stream, um, and,
uh, I have many similarthoughts.
Some areas where I disagree,actually, um, but, uh, I'll,
I'll talk to it.
I thought I might use kind of a,a bit of a framework of, of, uh,
first talking about the style,just kind of the format.
(11:27):
And then, um, My take on thesubstance and then some thoughts
on potential, you know, whatthis means maybe in terms of
potential strategic shifts forApple.
Um, and that's, uh, where, um, Iget into maybe some thoughts on
pricing too, but, and, you know,feel free to jump in at any
point as well.
But, um, on the style front, onething I'd say is.
(11:51):
I would really stronglyrecommend to Apple that they
move away from this pre recordedformat that they adopted during
the pandemic.
I think, you know, obviouslyduring the pandemic, it made a
lot of sense.
You didn't want to bring a lotof people out to an event.
Um, that would be, you know,become a super spreader event.
Um, so that made a lot of sense,but you know, now that we're Out
(12:13):
of the worst of that and theircompetitors have all moved to in
person events where they'reactually providing live
presentations.
Um, I think it's, well past timefor Apple to come back to that
sort of a live event.
And that, I think there's a fewreasons for that.
At just sort of an emotionallevel, there is this sort of
(12:34):
frisson that comes with a livepresentation that Apple's pre
recorded keynotes justcompletely lack this energy that
they lack.
you know, I actually, um, forthis episode, I went back and
not only watched Apple's event,but also watched, um, Google's a
quote unquote made by Google2024 keynote, aka the pixel nine
launch that was held just abouta month ago.
(12:55):
I went back and watched that andthat event was entirely live and
Google's presenters repeatedlyemphasized the fact that their
product demos were also alllive.
Uh, which was illustrated by oneof the early demos, uh, which
failed repeatedly.
So you can kind of see that itwas truly a live experience.
Um, and the fact that Google'sevent was all happening live,
(13:15):
warts and all gave it a tension,but also just sort of this
pathos that made me connect withit in a way that I just couldn't
connect with Apple's event.
By contrast, Apple's event to mefelt like.
The world's longest, you know,best produced, but also dullest
infomercial.
Um, I, I don't recall Steve Jobsever speaking to this publicly,
(13:38):
but I'm confident that herecognized the importance of
human personification of brands.
That's why the legendary, uh,think different campaign that
reestablished the Apple brandback in 1997, back when the
company was on the verge ofbankruptcy.
That ad featured exactly zeroproducts and instead highlighted
the types of people thatembodied Apple's core values.
(14:01):
Now similarly, when it came toApple's keynote events during
that jobs era, I think herecognized that the audience
needed a human that they couldconnect with and associate with
the brand.
And he was that personification.
He was the storyteller in chief.
He did most of the demos himselfon stage.
You know, of course, not all ofthe events during this era, that
(14:22):
era were stellar, but jobscreated an atmosphere that was
remarkably akin to thatfundamentally human experience
of gathering around the campfireto hear a story.
By comparison, today's Appleevents featured this cavalcade
of presenters, you know, all ofwhom are really talented
presenters, but most of whomsound like they're reading a
(14:44):
script based on a press release.
And it just makes it.
I, I mean, I, in the past Iremember I would, um,
butterflies in my stomach thenight before an Apple event and
I'd have difficulty sleepingbecause I was so looking forward
to it.
And this one, I don't think Iwould've watched it if it
weren't for the fact that wewere planning to talk about it
(15:06):
for this episode.
And when I watched did watch it,I really struggled to keep
watching it.
Um, it really felt likehomework.
Um, so I think that there's alot.
Of opportunity for, uh, Apple onthe style front to get back to
something that, um, just is, youknow, it's not just, uh, a
(15:30):
verbalized press released invideo format and to something
that feels more like a story.
And that gets me to thesubstance.
And, um, here is something thatI've seen Apple, um, fall into
really ever since Steve Jobspassing, which is, um, They seem
(15:51):
to forget the why, you know,this, I think that was one of
the greatest things that jobsdid in his keynotes was that he
made a point of helping us asthe audience understand why they
were doing these things thatthey were doing.
For example, in that originaliPhone launch, that legendary
iPhone launch, one of the keymoments was he shared that sort
(16:14):
of business school 101 chart,the four quadrant chart, where
you have, um, easy to use, uh,on the X axis where, on the far
left, it would have beenproducts that were hard to use.
And then not so smart to smarton the Y axis where not so smart
was on the bottom and smart wason the top.
And he, uh, depicted.
Just traditional dumb phones ason the very bottom of that not
(16:37):
so smart y axis.
And then he depicted all of theexisting smartphones on the kind
of moderately smart level of they axis, but all the way over on
the wrong end of the easy to useaxis.
And you know, that very clearlypainted the picture of This
opportunity, this need for asmartphone that would be truly
smart and truly easy to use, youknow, occupy that upper right
(17:01):
quadrant on that framework.
And that was the why behind theiPhone because nothing like that
existed yet.
So that's why we, you know, madethis commitment to make this
incredible device.
And that was something that Jobsalways did, which I was actually
surprised by because very fewother companies.
ever bothered to do that intheir product launch events
(17:25):
across industries, not justtechnology.
So I've always found that reallyinteresting, um, that jobs made
it made a point of doing that.
And to me, that was a huge partof why Those Steve notes, as
people call them were socompelling, you know, he was, I
think a very good presenter, butalso every story has to have a,
(17:47):
why, right?
No fiction story is ever goingto try to get away with not
explaining the motivation fortheir characters, the why, uh,
and it's, you know, it's thesame when you're talking about a
product as well.
And what I've seen from Apple inrecent, you know, really post
Steve jobs is they just go rightto the what.
(18:09):
You know, it's just, oh, hey,here's this product with X nits
and Y flops and, you know, Z,uh, whatever.
Um, isn't it great because ithas just all these what's to it,
but they never get to the why.
They never really explained whywe're doing this.
And I really found that to bethe case.
There are, there were a coupleof areas where I thought, okay,
(18:32):
that's, that's pretty cool.
Like for example, With the watchand the sleep apnea feature, you
know, they explained that that'sa really, um, common issue.
Um, and so that was somethingthat we wanted to address.
Okay.
That's really compelling or theAirPods pro two and the new
hearing aid functionality.
You know, that too is a reallycompelling feature, but.
(18:52):
For the iPhone presentation andthe iPhone pro, I just felt like
there was never a why it wasjust a series of features of
series of what's without a whyto bring it all together.
So, um, I just feel like that'sa big area of, of opportunity
for Apple when it comes totheir, their, the way they
(19:14):
approach their products.
And I think I suspect this.
Um, is something that exists onthe product creation side of
Apple right now, too, that, um,I suspect that they're at, you
know, in terms of their productbriefing, they're also briefing
at a very feature level.
Um, and so that's, that's.
(19:37):
Carrying over into theirstorytelling as well.
And I think it would really, youknow, to your point, uh, help
them get to a more compellingplace if they really started
with the Y and that might leadthem to actually take some
features away.
Um, which is, you know, what youwere speaking to just a minute
ago.
It doesn't seem that they'redoing that.
(19:57):
They're really stuck in thissort of speeds and feeds
approach to product marketing,which is something that Steve
jobs really.
Derided, you know, that that wassomething that all the
competitors did, but Applewasn't about speeds and feeds.
It was about getting at the why.
Um, The one substantive thingthat I thought was interesting
was you mentioned the, thecapture button that was kind of
(20:21):
probably the key new feature,hardware feature on the devices.
Uh, and I thought that wasinteresting in a couple of ways.
One was it represented thiscontinued move away from, What I
think a lot of people assumedApple was trying to move to,
which was this fully sealeddevice when, um, Apple
eliminated the headphone jack.
(20:42):
I think a lot of people tookthat as a signal that Apple's
goal was to get to this fullysealed device with no moving
bits.
You know, you'd probably befully, uh, reliant on wireless
charging any buttons on, youknow, the volume buttons would
be, um, haptic and not actually,uh, you know, move at all.
But instead, uh, last year theyintroduced the action button,
(21:04):
uh, which was a physical buttonon the devices.
And then now this year they'veintroduced the capture button.
So I, I feel like that's aninteresting move away from, um,
the direction they seem to havebeen heading.
And, uh, I hope this issomething that we see copied
more broadly and particularly inthe automotive world where I
think, the automotive players,many of them followed Tesla you
(21:27):
know, in this direction oftaking away all buttons, which I
think is a, cue they took fromApple as well.
I think a lot of folks who ownthose types of cars, you hate
that experience,, hate having tohunt for buttons.
So, um, I hope that folks inother industries will take this
as a cue that, Hey, just thisfuture of buttonless devices is
(21:52):
not a great future.
And so let's, uh, you know,maybe bring back buttons where
they're warranted.
Another.
Thing that I thought wasinteresting about the capture
button, which kind of gets intostrategy.
What is the fact that thecapture button is offered on all
versions of the iPhone 16.
This is a really big differencefrom Apple's recent history
where when they've introduced anew feature, it would always be
(22:14):
introduced in the pro models,which would be kind of one
vector for differentiation ofbetween the pro and non pro
models.
Whereas this year, the capturebutton, which is kind of the key
feature is being made availableacross the board.
Uh, whereas, again, the actionbutton was introduced only on
the iPhone 15 pro models lastyear.
(22:35):
The standard iPhone 16 isgetting it for the first time,
but they're all the standardiPhone 16 models are also
getting that capture button.
And yeah, I think that reflectsa bit of a shift on Apple's part
where in recent years they havebeen trying to push consumers
into those higher price tiers ofthe pro models by, you know,
(22:57):
offering these new features thatwere only available on the pro
models.
But, you know, I may be readingtoo much into it, but I think
this addition of the capturebutton across the line suggests
that, um, they're trying to, um,broaden access to, you know,
They're most compelling featureswith the recognition that, um,
(23:23):
they services are really wheretheir future lies in terms of
revenue growth.
Um, because yes, I would agreethat the phones are kind of
insanely expensive, like the prophones, like you mentioned over
a thousand dollars for thebiggest phone, but they've
actually held on their pricingsince last year.
(23:44):
And if you consider inflation,pricing of the iPhones have
actually declined over the pastfew years.
And I, I have to imagine thatthat's not an accident, you
know, that there is a bit of ashift on Apple's part
recognizing that, you know,maybe they're willing to take a
little bit less of a margin onthe hardware so that they can
(24:07):
expand the pool of people, um,who they can address, uh,
through their services.
Where they have an even biggermargin.
Um, and, where they, I think areseeing a bigger growth
opportunity.
The site Stratechery, which somefolks may be familiar with.
Um, the author there recentlyposted an article about that
(24:28):
with some similar thoughts andI'll, I'll post a link to that
in the show notes.
Um, so that's one thought into,in the strategy front.
One other thing that, I kind oftook away from this and I don't
know if this was intentional ornot, but was the seeming
transition from a kind of brandstrategy perspective of Apple
(24:50):
from this company that used torepresent like magic and wonder,
right?
Like that was one of the thingsthat made Steve Jobs keynotes.
So compelling was it just, you,you felt like every
presentation, you You'd be wowedand you'd be blown away by
something that you'd never seenbefore.
And it seems like, you mentionedthis as well, Joachim, that they
(25:12):
seem to be shifting into thisutility mode.
They use the word indispensable,um, a few times.
They want to be this sort ofindispensable utility.
Um, so it does seem like thereis this shift away from the
company of magic and wonder tothis company of indispensable
utility.
One big.
(25:32):
expression of that is theirfocus on health.
And I wondered whether theymight also be seeing health as
one, a compelling, um, productopportunity, but also
potentially an opportunity to,um, be able to draw subsidies
(25:53):
for their hardware, uh, viaInsurance providers and
government, um, health providersin a similar way that they've
been able to draw subsidies ontheir phones from carriers
around the world.
Which for them would be a greatmodel, right?
I'm sure they'd love to be ableto replicate that phone subsidy
model, um, across more of theirproducts.
(26:13):
So those are two interestingthings that kind of struck me
from a strategy perspective, butI'd say overall, I think like
you, I was pretty disappointed.
I would agree a lot of people.
I've, a lot of coverage.
I've heard some of the techfolks say, this sentiment that
it was disappointing isridiculous because, um, the, the
point isn't to get people toreplace their phones every year.
(26:36):
So it's, this was really gearedtowards people who have an
iPhone 14 or even a 13 or 12.
And you know, yes, that's true.
You shouldn't be replacing yourphone every year.
That's silly.
And yet I do think thatHistorically, big part of the
Apple brand was bringing wonderinto the world.
Uh, and you know, they even havedevices called magic, magic
(26:57):
track pad and magic keyboard.
Um, and it seems like they've,they certainly didn't deliver
that this year with thisannouncement.
Um, and whether it's a signalof, uh, a broader shift or it's
just, an off year, um, it's not,not clear, but to me, if you
look at some of the recent,year's keynotes, I do see a
(27:21):
broader shift.
maybe this is a more of a dipthan usual, but I do think that
it's, it's one in a series ofsignals that points to a broader
shift.
Joachim (27:31):
Oh man, there's a lot to go over there.
What you were linking to is theidea that this, this company is
trying to become indispensableand they want to, they want to
do everything and they want tobe a service provider for
everything.
and hardware becomes the vehicleto provide those services.
Apple wants to become a platformvery much like, Netflix, Amazon,
(27:53):
but they have this hardwarething.
thing.
that allows them to basicallypopulate that hardware with all
of their stuff.
So cloud storage, forget aDropbox, like iPhone.
You want to have an iPhone, youhave it sync up nicely.
Just use the cloud storage,iCloud.
Messages, movies.
I mean, they're really trying tocontrol that ecosystem.
(28:14):
And they have the hardware to beable to control exactly what
shows up on there.
We've all become veryconditioned to believe that
platforms are these magic moneymaking machines that can just
get subscription fees, and thenthat's that.
Apple already has a combinedsubscription program for its
cloud, its news, its music, andmovies, and fitness, all sitting
under one umbrella.
(28:36):
And when I see that,, as aperson who worries about how
platforms structure themselves,I basically see the end.
What's going to happen inside ofthis company is that decision
making is going to becomeincredibly difficult.
You are going to have to startconstructing attribution logic
inside of your own company todecide who is generating value
(28:58):
for your company.
So for example, if you have onesubscription program that covers
everything and, Let's say thecloud program decides to get to
make some crazy coolimprovement.
How will you justify theinvestment in that cloud storage
program?
Well, they'll have to come upwith some exotic description of
how, well, I got the cloud thingand because the cloud's better,
(29:19):
people are subscribing more.
And because they are increasingthe chances they're going to
subscribe, I, I earned, youknow, a fraction of that
subscription revenue.
And that's,, my contribution tothe bottom line in Apple.
And then, well, health will say,no, we got these new trainers
and this new program and that'sgoing to prevent, that's going
to keep people, re upping theirsubscriptions.
(29:39):
And we actually, 20 percentresponsible for those
subscription fees.
So we take 20 percent of therevenue every time and so on and
so forth.
And.
What that leads to is just thisbizarre synthetic bean counting.
Like it's not real money.
You don't even know who'sgenerating value anymore.
Uh, and Apple's business hasbeen traditionally in hardware.
(30:02):
Like here's a thing, we make it,there's margin on it.
And you sell it.
It's cost of goods, this is theprice, and that's that.
You push into these subscriptionthings, you're going to start
unraveling the whole strategy ofthe company, and you're going to
start creating this incrediblyambiguous and hard to manage
platform system.
Now, Netflix will claim theyfigured it all out and
(30:23):
everything's fine.
I sincerely, sincerely doubtthat.
The level of precision you wouldneed to be able to put onto
these numbers is ridiculous andnigh on impossible.
So you'd have to be able to say,hey, should we buy a season of
Some TV show.
Should we add another season ofsomething?
Let's take something reallystupid that no one cares about,
(30:43):
like Hilda, which is a kidsshow.
Absolutely brilliant.
I love it.
Everyone should watch it.
A little recommendation inthere.
I wouldn't mind watching anotherseason of that.
So it's going to cost someamount of money to do that.
How do we know that makes sense?
Well, you have to say, well, theprobability that everyone's
going to renew theirsubscription because of the
presence of Hilda is this thing.
How will you know that ifthere's also a thousand other
(31:04):
things that are coming down thepipe and they're going to come
into the system, everything isinfluencing everything else.
And no person is giving you aclean signal that the reason why
they're subscribing is becauseof this specific piece of
content.
You're going to have to infer itfrom their viewing behavior.
So everything's in the top 10.
It's all the same.
I'm going to look at everything.
I mean, it's all noise at thatpoint.
We're all watching the samestuff on Netflix because they're
(31:25):
pushing the same things onthere.
So for them to dis unpickexactly what contributed and
created value.
That's the problem.
That's why they couldn't extractmore out of their movie making
business, TV show makingbusiness, because they didn't
know what to buy.
They just did everything likeevery other TV channel.
Did 20 30 years ago.
Like, their content strategy wasthe same as it's always been.
There was nothing new.
(31:45):
The data doesn't give youanything.
Um, and if they had used theirbrains, there were a lot of
shows that really suffered.
Um, a lot of brilliant shows.
There was a show that actuallyPharrell produced called
Brainchild.
It only got one season.
It's a kids science program.
And allegedly, one of the bigmetrics inside of Netflix is
bingeability.
Now, Brainchild is a children'sshow.
(32:09):
Children have time limits.
We place time limits on theviewing habits of our children.
So, you can't just look at hoursconsumed to figure out if this
is a good show for children.
You have to construct Anunderstanding of how a child
consumes something and how thatgenerates a future path of
attachment to the platform,which is really hard to pick up,
to capture.
They, they never get anotherseason.
My son, every three months willwatch the whole season again and
(32:33):
is always sad that he can'twatch more.
No one is listening.
No one has said, oh, by the way,we can quickly knock out another
season.
Like, none of that fancy tech,we figured out all this deep
stuff about human needs.
It's all noise.
It's all nonsense.
So I think the danger is whenyou start creating these
packages and these problems,you're going to have to start
parceling out exactly who getscredit for what.
(32:55):
It's terrible.
So to add the last bit of icingon the cake to make it feel
very, very grounded, the wallstreet journal published an
article last month aboutAmazon's device business.
The device business was designedto get Alexa at everyone's home
and they were going to heavily,heavily subsidize the devices.
And the way they were going tojustify the investment of those
(33:16):
devices was to say that therewas this downstream impact.
DSI.
It was basically.
A system of equations thatallowed you to get some number
around what the downstreamimpact is from your thing.
And the right way they did islike, you used my service, which
I care about as a product ownerinside of Amazon, and then I'm
going to claim this chain ofevents that happens downstream
(33:38):
from where I am.
So if you started buying morestuff because you had an Alexa
and you're ordering on the,like, I'll take credit for that.
But guess what?
Someone was upstream from you.
They're probably going to takecredit for everything that
happens downstream from you aswell.
And someone's downstream fromyou is taking care.
So basically the joke was alwaysthat if you added up everyone's
downstream impact, Amazon wasgoing to be like a thousand
(33:58):
trillion dollar company.
Like it was, it was, the numbersdidn't add up the wall street
journal points article pointsout that this was one of the
main reasons why the device isbusiness.
fell down and lost, you know,billions of dollars because
there was no real money comingin.
It was just all attributed viathese other money generating
things.
The only way you'd ever be ableto identify truly realistically,
(34:21):
if this business made money andactually generated more revenue
is if you had another Amazonwithout the devices business.
And then you measured what wouldhappen in the exact, so parallel
world.
Like that's, that's what theimpossibility is.
And I love models.
I love math.
And I love to believe thatthere's a way to get closer to
that number.
And I always will try and dothat, but don't get yourself
(34:43):
into that mess.
At Apple, I think this is what'sgoing to happen.
You know, someone's going tohave to say, well, we need to
figure out how to attribute thisand blob.
We need machine learning and AI,and you just get this overhead.
When it was simple, this thing,that's the profit and you move
on.
They have to be careful becausethere is a real, real risk here
that you start destroying theability to make good, well
(35:05):
founded.
tethered decisions.
And you're going to start hopingthat you can convince the stock
market that there's some magicat the end of the tunnel.
And partly my cynicalperspective is this is why
Netflix has entered into theadvertising business.
Like what else are they going todo?
They're not going to get moreefficient.
They're not going to get smarterwith the way they decide.
What to do and how to findstuff.
They're just going to sell youreyeballs now.
(35:27):
And the only way this progressesis that they start working their
way through all of the tiersuntil there's only a hundred
dollar a month tier that haszero ads.
And the rest are all somemodulation of different
variations of that.
I mean, that's, that's.
It's going to slowly happen.
We're all just on the cooker.
It's just always works its wayfrom the bottom up.
It's terrible.
You know, they, they got peopleoff the lowest ad free tier.
(35:48):
They just said that tears goneguys, bye.
You just have to watch ads now.
I'm like, okay.
And then of course, then Netflixcan say, look at the audience
that we have that watch ads andlike, yeah, you forced everyone
to watch them.
So the platform business seemsgreat.
It's good for the market, forthe stock market.
I don't know how sustainable itis.
I mean, Tim Cook's going to getpaid.
He's going to cash out.
Everyone's going to cash out.
It's going to be fine, but thecompany and the legacy and the
(36:10):
employees that are just joiningand see a future at that
company.
I don't know.
I feel bad that if this is thedirection that they want to push
into, it gets very, very.
tricky and hard to justify whyyou're doing what you're doing.
Um, it's not clean anymore, itbecomes political.
So, yeah, that was, sorry, thatwas a very long excursion into
that strategy piece that youwere
Ernest (36:31):
Yeah, no, no,
Joachim (36:33):
yeah, but it, it, it was on my mind, yeah, as you
were talking.
Ernest (36:36):
I, that's something I've, I'm really torn about
because I definitely agree.
I, you know, I remember whenSteve Jobs came back to Apple,
he was so proud of talking aboutthe fact that you could fit all
of their products on one tableand you know, it was such a
clean, beautifully simplebusiness and it led to this very
Clear relationship between Appleand its customers.
(37:00):
Um, and yeah, I really do thinkthere's beauty to that.
You could see where the valuewas and to your point, it's now
so muddled and murky, um, andyeah, Apple is such a different
company now where you mentionedthat iPhone lineup itself is
just, there's so many productsin just that line alone.
(37:21):
They're still selling the the 15and the 14 and SE, uh, and, even
though obviously those aren'tgoing to deliver the best
experience that Apple candeliver.
and yet what, you know, on theopposite side of that, what
makes, gives me some pause isthe recognition that, all right,
(37:44):
let's, this is predicated on theassumption that we're going to
accept capitalism and, andaccept that as a, uh, public
company Apple has to, has to, Todeliver continued growth.
So I think you could make areally good argument that maybe
we should reevaluate that, butlet's say, you know, we're going
to accept those that Apple can'tcontinue to deliver growth
(38:08):
through hardware sales alone,it's.
It's I think just impossible.
Um, they could try to enter newcategories, but there certainly
wouldn't be possible to do thatand also deliver on their
sustainability goals, which, youknow, I think are vital for all
of humanity.
So if you, if you accept thoseassumptions, then I think you
(38:31):
know, you, Come to theconclusion that yet they do have
to find new, um, revenueopportunities.
And so, you know, it just feelslike services does seem like a
pretty obvious mechanism todrive that continued revenue
growth without putting morephysical, um, bits, atoms out
(38:53):
into the world, right?
That's, why I see it from bothsides that I, I do think today's
Apple is just, it's not acompany that's as easy to love
as it used to be.
And to your point, I think fromthe back end as well, it's gotta
be an incredibly difficult thingto manage and to try to
understand.
and yet I do see why they'redoing what they're doing
(39:15):
because.
Absent this services revenue,Apple would be really battered
by Wall Street because theywouldn't be delivering the
growth that Wall Street expectsthem to continue to deliver.
So,, I think it is a challengingsituation.
Joachim (39:31):
Oh, I agree.
I agree.
If you want to do the platformbusiness, you have to design it
from the ground up to be a thingthat still has the discipline of
what you would call atraditional profitable business
with costs and revenues.
You would have to actually havea clear communication pathway
between the customers and.
(39:52):
The actual service.
I mean, that's the thing that, Ididn't say it directly, but
really what it is, why is thehardware business so clear?
you buy the thing and that's thetransaction it's done.
A service has a subscriptionpath.
It has many components to it.
It's very clumpy and it's hardto tell what it is that a person
is actually enjoying about theservice because everything is
lumped under these umbrellas,even Apple news is a set of
(40:15):
things.
it's not one thing.
It's not even one article.
When I'm thinking about platformdesign, you have to think about
this as a communication protocolbetween my customers and the
service, and I need to defineways of getting in the fidelity
of communication so that I canalso understand what they're
valuing.
The buzzword you can use, Ithink it's, it's It's overused
(40:36):
and it's mis it's abused, butmicrotransactions is a way of
getting at this idea that I wantto be able to signal to the, to,
to the platform what I'm valuingin this moment.
And it shouldn't be thisindirect inferential process
that the company has to gothrough.
to justify and understand whatthe user is doing.
it's ridiculous.
That's why we have thistechnology is that you can tell,
(40:56):
I can tell you what I want, youknow, I find it so stupid that
we're locked in thesesubscription walls, but of
course, it's part of the, it'sthe old paradigm.
It's, and that's the thing thatI think is very, Sad.
I, I think that's the thingthat's interesting is that Apple
has not applied its way ofthinking to the services model.
(41:16):
They're just replicating what'sexisted.
And that's so lame, right?
That goes against the wholeethos of what Apple's doing.
If they wanted to do it, theycould do it.
They have the brains.
I think they just need to beopen to that.
But again, it means that youhave to educate the market.
You have to educate wall street.
You have to tell them it's goingto be some rough time.
We're going to do some crazystuff and we're going to try
things out.
But that's the problem.
(41:37):
I think Tim Cook is just a, andeveryone right now is just so
conservative and they just wantto.
You know, cash out and ride,ride the wave as long as they
can.
And who cares about the futureof the company?
it's a shame because, it neednot be that way.
I think that's always what Ifind so frustrating is like the
business model need not operatethat way.
Yes.
You need growth.
You need all these things topacify the market..
(42:00):
I mean, Bezos did that back inthe day.
He said, you, you, you want thething and I'm not going to give
it to you.
This is the business that you'reinvesting in.
No profits for a long time.
And they were like, okay, fine.
We'll, we'll keep buying thestock and holding onto it, you
know?
Um, so there is a way you justhave to set the tone.
And, uh, and like you said, itbecomes more of a human
(42:22):
conversation, right?
It's this Steve Jobs with thispersona that it was kind of the
human fleshy embodiment ofApple, um, rightly or wrongly,
right?
Of course it's this huge thing,but I think that was something
that you said at the beginningis the humanity that was there
always, and the product was sucha big piece of what they were
doing.
And you felt a connection to, toApple, which makes me think
(42:46):
about the first, like the happyMac.
Ernest (42:48):
Yeah.
Joachim (42:49):
that Susan Kerr designed, which is just that
original Mac and a little smileyface on it.
And it's just absolutelyincredible.
which also reminds me of thatscene in Halt and Catch Fire in
the first season they go toComdex and our, the main
character that we've beenfollowing who's kind of a Steve
Jobs guy, Lee Pace's character,Joe McMillan, he's in the room
when they switch on the, theApple Macintosh.
(43:11):
Joe McMillan's he's mesmerized,and, and then, someone types in
some words and it's voicesynthesizer works.
And Macmillan can only say liketalks and it's, it's the
humanity in it, right?
Everything was so human.
Uh, and I think, yeah, yourplatform business can be, you
just have to.
design it from the ground up tobe that way.
(43:32):
It's more work.
Why don't you now do somethingthat is actually radically
different and, and pushes theboundaries of how people run
these businesses.
I think it's a shame thatthey're so conservative about
this stuff, but
Ernest (43:45):
No, to that point, I think, you know, you gave that
example of the show that yourson loves.
Um, was it brainchild
Joachim (43:52):
brainchild.
Ernest (43:53):
Netflix?
Yeah.
I would, in terms of our, whatcould you do about it as say a
product manager, I would justhope, that you as a.
product manager at Netflix.
I would assume they must have,product managers for kids
content.
I'm not sure how they organizetheir product groups, but, um,
let's assume that they do that.
(44:14):
Part of what you could do isadvocate for a different set of
KPIs for your kids content,because to your point, kids have
guardrails around how muchthey're able to watch you if
you're a good parent, right?
So we need to judge our kidscontent with a different set of.
KPIs, let's say, then we do ouradult content.
(44:35):
So helping your leadersunderstand that, there's a
different lens for success thatwe need to look at this through
so that we can help, thosefolks, uh, in leadership
positions.
Then apply judgment in a morethoughtful way.
Hopefully, you know, as, as justin terms of like, as a, what can
we do as a product manager levelperson to affect change in a
(44:57):
positive direction?
I guess that'd be one thing thatcomes to mind.
Joachim (45:00):
I think the trap that you can fall into, well, let me
put it this way, an engineeringor software engineering mindset
flattens a lot of the complexityof the problem by necessity,
because they're going to try andbuild a system that does stuff.
But like that example of themillion checkboxes does, you can
create this very flatenvironment that these very deep
behaviors emerge.
And in entertainment, those deepthings are there, that they're
(45:22):
in the data somewhere, but it'sbecause you've decided to
flatten it into a KPI of somekind that things are wrong.
You have to always represent thepath, that story of Who's doing
what at what time, and how doyou see that flow of activities
contributing to an overall, uh,attachment to the platform you
have to find ways to open upthat communication pathway from
(45:43):
the customer to your platform.
Whatever it is, hardware,software, it's the same thing.
One of my other jobs, was atraditional game studio, triple
A game studio, that wouldrelease a game with a huge
marketing blitz, and they wouldsell, they would make an
(46:04):
enormous amount of money.
And then that's it.
One and done.
And then get ready for the nextone when, when you've got the
energy again to, to make a newgame.
And it was a very, very cleantransaction.
But the business that they're inright now is a live game system
and that's an always on service,right?
Where people are not buying thegame and not expressing an
interest.
They express attachment bybuying cosmetic items.
(46:26):
So you're kind of back in thatweird, like, inferential process
of trying to figure out, didthey like the game still?
Buying these cosmetics?
Did this game make them want tobuy the cosmetics?
Like, are they just buying thecosmetics because it is Star
Wars and it's so attractive?
You know, it gets complicatedand um, the company has to shift
its mindset to adapt to that wayof thinking.
(46:49):
When before it was very clear,Get those discs into the shops,
put them into a prominentposition, they will sell, and,
and, even if they hate the game,this is the thing I think
people, even if they hate thegame, you will still make money.
But in a live serviceenvironment, that's not the
case.
I think that's the problem withthe entertainment industry in
general, is that they've, the,the transactions changed, you
(47:09):
know, it's now become much moreof a, a slower burn, things are
indirect and hard to unpick,
Ernest (47:18):
right, right, kind of getting to that point of
understanding that why, why arethey doing these things that
they're doing, and to your pointthat it Starts to get very
muddied when you have these,rolled up services that are
doing a lot of different thingsat once.
I like, for example, I have noidea why Apple does Apple TV
plus.
It just baffles me.
Joachim (47:39):
Yeah.
Ernest (47:40):
Uh, it's
Joachim (47:40):
I mean, yes.
Why are you making movies?
They make so many movies aswell.
I don't get it.
Ernest (47:46):
Yeah.
That's a really, I'd love tohelp one day.
Somebody tells the backstory tothat one because, um, that'd be
really interesting to learn moreabout that.
Uh, speaking of Apple TV Plusthough, there's a series called
Drops of God.
It's based on a, it's based on amanga.
Uh, And it, you would, youwouldn't know it existed like
(48:08):
Apple has done absolutely zeropromotion for it, which is just
so sad, but it's just absolutelygorgeous.
It's, um, a little bit, uh, youknow, it's an adaptation.
So it's a little bit differentfrom the source material.
Uh, one big change is that muchof it is set in France, although
there is still a big component,um, in Japan as well.
Beautiful, beautifully shot,really beautifully written and
(48:30):
acted.
Um, so that would be one goodthing on Apple TV plus I'd
recommend.
I'm also a slow horses fan, but,um, yeah, there's a few, few
gems on there.
Joachim (48:41):
heard.
Slow horses is definitely one ofthe really good shows.
It's ridiculous.
I mean, Gary Oldman isdisgusting in that.
So it is, it is always a treatto see how far he can push, push
that acceptable behavior onscreen.
Yeah.
Ernest (49:00):
All right.
Well, we've kind of veered intorecommendation territory, but, I
think we had a good conversationabout, uh, the Apple event as
well.
Um, now, as I mentioned earlier,we want to hear from you.
Do you agree or disagree withour takes on Apple's iPhone 16
event?
What do you think of this newepisode format?
And as we asked earlier, do youhave any suggestions on what we
(49:21):
should call this new format?
We want to hear from you.
So please share your thoughts atLearnMakeLearn@gmail.Com or on
threads at LearnMakeLearnShow,all one word.
Thanks for listening and we hopeyou'll join us for the next
Learn Make Learn.
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