00:00:15 ◼ ► Hello, and TextExpander. My name is Myke Hurley, I am joined by Jason Snell. Hello, Jason Snell.
00:00:20 ◼ ► Hello, Myke Hurley, how are you? I'm fine and dandy, my friend. We have a #SnellTalk question
00:00:25 ◼ ► from Ivan, and Ivan wants to know, Jason, how do you wake your Mac from sleep? Do you press
00:00:30 ◼ ► a specific key on the keyboard? Do you click a mouse key? What do you do? It's the one and
00:00:35 ◼ ► only Ivan. I feel like I've gotten this question before. I feel like I've gotten this before. At
00:00:40 ◼ ► a certain point, we will answer all of the same questions more than once. I suppose so. The answer
00:00:46 ◼ ► is I don't. I guess I do have a laptop now, I have a MacBook Air, and I press the space bar.
00:00:52 ◼ ► I think that's what I do. I'm pretty sure that's what I do. And on my iPad Pro, when it's in the
00:00:57 ◼ ► smart keyboard case, I will press the space bar to wake it up, usually. Yeah, space bar is a good
00:01:03 ◼ ► one. My iMac I don't put to sleep, although it does have a screensaver, so eventually I will wake
00:01:08 ◼ ► it up, and that's generally the space bar. Space bar is my go-to, but I don't generally sleep my
00:01:13 ◼ ► iMac. I start it up every morning and I shut it down at night. Right. It's a thing I do,
00:01:19 ◼ ► that apparently lots of people don't do. Although I was thinking about this, if my next Mac here at
00:01:25 ◼ ► my desk is Apple Silicon, I was thinking about the fact that Apple Silicon Macs, because they've got
00:01:31 ◼ ► the efficiency cores, there's basically no like power nap anymore. They are just capable of running
00:01:39 ◼ ► with their efficiency cores as needed and doing stuff in the background. And I thought,
00:01:45 ◼ ► maybe when I get an Apple Silicon Mac at my desk here, I will consider not shutting it down,
00:01:51 ◼ ► but instead putting it to sleep and seeing how that is. But so many years of dealing with laptops
00:01:57 ◼ ► that would not wake from sleep and having to reboot when things got weird, having a desktop,
00:02:03 ◼ ► again, as my primary, I just really enjoyed the idea that every day it was fresh and not running
00:02:10 ◼ ► for 40 days in a row and weird things start to happen and I have to reboot. And I have to say,
00:02:15 ◼ ► it's pretty stable. I very rarely have to restart my computer during the day unless there's a
00:02:19 ◼ ► software update or something. What about the potential M1 would maybe change your mind? Is
00:02:24 ◼ ► it because of the lower power draw or something? I think, well, partly, but it's also just the idea
00:02:30 ◼ ► that it's designed to run like without, because power nap, the idea behind power nap was it wakes
00:02:36 ◼ ► up occasionally a little bit, does some stuff and goes back to sleep. And my understanding is that
00:02:40 ◼ ► with the M1 Macs, it can just always be aware. Well, I guess like an iPad. Right. Exactly. You
00:02:49 ◼ ► don't turn it off, do you? You just don't turn it off. Right. And I think the trick is it's got the
00:02:54 ◼ ► low power cores. So it's designed to be in a mode. The iPhone and the iPad were always designed to be
00:02:59 ◼ ► in a mode where they're on, but only a little bit. And I'm intrigued by that feature on my desktop
00:03:10 ◼ ► Mac that I might just put it to sleep and see how it goes. But I don't normally do that now,
00:03:17 ◼ ► just laptops and iPads and things. But space bar is the answer to Ivan's question. The space bar,
00:03:22 ◼ ► it's the universal symbol for waking up, the space bar. If you'd like to send in a question to help
00:03:27 ◼ ► us open an episode of Upgrade, just send out a tweet with the hashtag #snowtalk or use question
00:03:32 ◼ ► mark snow talk in the Relay FM members Discord. We have some follow up on Magic Keyboards,
00:03:37 ◼ ► don't we, Jason? Yeah, it's good news. Now, I feel like we got this right. We nailed it in the last
00:03:43 ◼ ► show, which was there was a report that the 12.9 inch Magic Keyboard for the iPad Pro fifth
00:03:49 ◼ ► generation was coming into existence because they wouldn't support the old model. The idea was that
00:03:58 ◼ ► all the ones that have been bought for the 12.9 iPad Pro for the last year aren't listed as being
00:04:03 ◼ ► supported by the fifth generation. And there was this whole kind of, I think rightfully so,
00:04:09 ◼ ► hubbub about the idea that that just makes your already pretty expensive iPad Pro that much more
00:04:14 ◼ ► expensive because you're going to have to buy another one of these things that you just bought
00:04:17 ◼ ► because it doesn't work. And it seemed weird because the new iPad Pro is not particularly
00:04:24 ◼ ► large. We said it's half a millimeter thicker is all. And so what I said, I think, and I think you
00:04:31 ◼ ► agree with me was this sounds very much like it fits, but it doesn't really meet Apple's exacting
00:04:39 ◼ ► specifications. Like it would be a little awkward or it wouldn't close quite right, or it wouldn't
00:04:44 ◼ ► look quite right. And therefore Apple's going to say that it's not supported even though it might
00:04:51 ◼ ► be fine. And it turns out that's exactly the case. Apple put out a tech note last week that said,
00:04:55 ◼ ► it may not precisely fit when closed, especially when screen protectors are applied. And so really
00:05:02 ◼ ► it's more that Apple thought it was awkward enough that they made an iteration of the Magic Keyboard
00:05:07 ◼ ► that's a little bit more loose fitting, which is probably the case with the Folio case that I got
00:05:15 ◼ ► that doesn't look any bigger, but it probably has a little bit more give in it for the bigger iPad.
00:05:20 ◼ ► And so if you've got a 12.9 inch iPad Pro Magic Keyboard for your 2018 or 2020 iPad Pro,
00:05:29 ◼ ► and you are thinking of getting this one, it sounds like it's going to be fine. You're going
00:05:34 ◼ ► to be able to use that case and that keyboard and it'll work fine. It'll just be not quite up to
00:05:41 ◼ ► Apple's perfect standards. It may be awkward, especially if you've got like a thick screen
00:05:45 ◼ ► protector on it or something like that. - We had a smart keyboard show up today. I actually
00:05:50 ◼ ► hadn't thought to unbox it, but it's the newest one. So it's for the fifth generation iPad,
00:05:57 ◼ ► because we would have wanted a new iPad. So I should actually try that out too, to see if it's
00:06:03 ◼ ► any bigger, because they did update that one as well. They updated all of them. So I will give it
00:06:08 ◼ ► a go on one of the older iPads, it makes a difference. This whole thing though to me is like,
00:06:17 ◼ ► honestly. - I know, but like still it took them the best part of a week to put the tech note together.
00:06:23 ◼ ► - Yeah, no, I do wonder that. I think they figured this wasn't an issue because they didn't
00:06:28 ◼ ► specifically say it didn't. It seemed like they just updated the database with a new set of
00:06:33 ◼ ► compatibilities. And it's one of those things where everybody's sort of doing their job,
00:06:42 ◼ ► this is the kind of thing where maybe there should have been like a PR statement that was like,
00:06:46 ◼ ► no, it'll work, it's fine. And then the tech note gets updated. But instead it was sort of like,
00:06:50 ◼ ► we just found the tech note and said, I mean, who knows? I don't know who found the tech note.
00:06:55 ◼ ► Maybe the person who found the tech note was pointed at it by Apple PR. I don't honestly know.
00:07:10 ◼ ► - Right? Like they could have just given a statement to The Verge and said, no, it will work.
00:07:15 ◼ ► It's just not as like, as tolerances aren't exactly what we'd like, so we updated it, but you can use
00:07:20 ◼ ► your old one. I mean, we only bought the new Magic Keyboard. So yeah, so I ordered an iPad for,
00:07:27 ◼ ► and like I said, 12.9, and she was using a 2018. And she prefers the smart keyboard to the Magic
00:07:34 ◼ ► Keyboard. And so I had to order a new one because the 2018 had a different camera cut out. So it
00:07:46 ◼ ► but not forward compatible. - Exactly. Because if you remember, that was just, it had the one camera,
00:07:51 ◼ ► and then the 2020 iPad had the big square one. - Right. It's either that or you take like scissors
00:07:57 ◼ ► and try to cut a hole. - I'm not going to do that. I'm not going to do that. I mean, you know,
00:08:00 ◼ ► that keyboard, you know, we've had that for many years at this point. It was my original one that
00:08:06 ◼ ► I got when I got that 2018 iPad Pro. We're fine to update it. - Yeah. I wanted to mention, I was
00:08:11 ◼ ► looking at pricing. I didn't order one. I did that thing where it's like, oh, but the 16 gigs of RAM
00:08:16 ◼ ► we know about now, and that's in the one terabyte and two terabyte models. And, you know, do I want
00:08:21 ◼ ► that? We don't really know. Is WWDC going to make me more motivated to have one with more RAM or not?
00:08:26 ◼ ► I don't really know. And then I priced the one terabyte cellular model. It's $2,000. - Is that
00:08:35 ◼ ► without the keyboard? - Yeah, that's just the iPad. That's a $2,000 iPad. And that's not the
00:08:41 ◼ ► most expensive one. That's the one terabyte cellular model. It's $19.99. - That is, yep, okay.
00:08:47 ◼ ► - And the thing is the 256 model is not that. It's like $13.99. It's appreciably cheaper. And I
00:08:53 ◼ ► thought, wow, this is a lot of money. And I don't know if I want that. And like, how much do you
00:08:58 ◼ ► really want a theoretical 16 gigs of RAM? I mean, the RAM is real, but what you do with it is still
00:09:03 ◼ ► a little bit theoretical. And is this going to be sort of like me paying a lot of money for spec
00:09:11 ◼ ► that will never, ever, ever actually be used? I don't know. But what cured me of my dilemma here
00:09:17 ◼ ► is that the ship dates for all this stuff was June, like late June. And because I didn't get
00:09:25 ◼ ► up at five in the morning because I wasn't sure I really wanted to buy this. And I thought, one,
00:09:31 ◼ ► well, by then we'll know what is going on with iPad OS and that'll give me some information about it.
00:09:37 ◼ ► - Yeah, but then you'd be waiting till August. - Right. And then two, the supply chain,
00:09:44 ◼ ► like the Apple's distribution channels are such that I know for a fact that when it says that
00:09:51 ◼ ► you can get an iPad Pro in late June by mail, I would bet you serious money that by the end of
00:10:00 ◼ ► May, I could just literally walk into my local Apple store and pick one up. - You have this
00:10:04 ◼ ► every time, don't you? I feel like recently we keep having these stories where you don't go for-
00:10:12 ◼ ► day and then just order one for pickup in your local store. I think you're right there, actually,
00:10:16 ◼ ► for those products. I think that makes a lot of sense. - There's nothing wrong with ordering one
00:10:20 ◼ ► that's way out, but I would say anybody out there listening who has ordered one and their ship date
00:10:23 ◼ ► is way, way out, keep your order 'cause you can cancel. 'Cause one of two things will probably
00:10:31 ◼ ► happen. One, it may contract, right? It may come closer and you may discover that your ship date
00:10:38 ◼ ► is closer than they originally said. But two, if you live near an Apple store, once these ship,
00:10:45 ◼ ► Apple doesn't put 100% of the models in the online order shipping channel. They don't. They put them
00:10:51 ◼ ► in Apple stores. And if you've got Apple stores around, you may very well find yourself able to
00:10:56 ◼ ► pick one up in an Apple store. So just something to keep in mind. - So the products are on sale now,
00:11:03 ◼ ► as we were mentioning. We ordered an iPad and an Apple TV. The iPad is not for me. I am not
00:11:12 ◼ ► ordering one. I will do what you're doing in the sense of like, I'm not gonna get anything and
00:11:18 ◼ ► I'll wait for WWDC. And then if it seems like there is a benefit for me ordering one of these,
00:11:23 ◼ ► then I'll try and get my hands on one. But it's really intriguing. So like most of the ship dates
00:11:28 ◼ ► for all of the products have slipped to June and to late June, which is not particularly outside
00:11:34 ◼ ► of the realm of normality, like after a day or two that you could be looking at three or four weeks
00:11:39 ◼ ► of some of the items being pushed out. The thing that's really interesting to me, I can't remember
00:11:44 ◼ ► a time when this was the case, when a new product come out and the delivery date is like 21st to
00:11:50 ◼ ► 28th of May. Like that's the delivery date. Like there's like a week window in there. And I just
00:11:56 ◼ ► found that really intriguing. And we're gonna talk about some of this stuff later, but I guess this
00:12:00 ◼ ► is Apple kind of hedging against potential supply issues that they might still be having for these
00:12:05 ◼ ► products. - Yeah, Apple, we will talk about it. There are definitely going to be issues and Apple
00:12:11 ◼ ► has said that they aren't gonna have enough to meet demand. So it's definitely gonna be a challenge.
00:12:17 ◼ ► - Stephen Hackett noted in the press release for when they put all the information about the
00:12:23 ◼ ► pre-orders that the green, pink, blue and silver will be the only IMAX available in retail stores.
00:12:30 ◼ ► The rest of the colors have to be ordered online. - Yeah. And those are the same colors that are in
00:12:34 ◼ ► the low end model, which is interesting. And I'm sure the low end model isn't the only model that
00:12:39 ◼ ► will be in Apple stores, but this is an interesting example of them simplifying their product line
00:12:45 ◼ ► in terms of distribution. I just talked about their retail channel, right? Like if you pre-ordered
00:12:51 ◼ ► an orange IMAX, you can't hope that it will show up at your local Apple store 'cause they're not
00:12:55 ◼ ► gonna ship them there at all. At least for now, you never know by the holidays, I wouldn't be
00:13:00 ◼ ► surprised, but this is a sales technique, right? It's a .com exclusive, essentially online exclusive.
00:13:07 ◼ ► We're not gonna ship these out to the stores because that's seven different sets of everything
00:13:14 ◼ ► instead of four different sets of everything. I wonder if you need a new power adapter or
00:13:20 ◼ ► you have a broken keyboard or something, if your local Apple store will have that in orange,
00:13:24 ◼ ► or if you'll have to also do that remotely. - It is not abnormal. I mean, it's actually,
00:13:31 ◼ ► it's the way that Apple do it. They only ever have certain specs in the stores anyway. So you can,
00:13:36 ◼ ► and it's not always just the base. Like I've gone to a store before and was able to just buy in the
00:13:42 ◼ ► store a higher spec model. They keep a few different specs around, but it doesn't surprise
00:13:46 ◼ ► me that they're not planning on having all of the colors with multiple spec tiers in all the stores
00:14:05 ◼ ► configurations that are available. And some of them are even sort of sold as like a build
00:14:09 ◼ ► to order, a configure to order configuration. But sometimes those configurations that are popular
00:14:15 ◼ ► are available in retail stores because they do want to serve their business customers or to upsell
00:14:19 ◼ ► somebody on a high-end system, right? They don't want to get somebody in the store saying,
00:14:25 ◼ ► you want, which is more expensive and will make us more money is not here. So go on the web and
00:14:30 ◼ ► leave our store or buy a cheaper one." Like they don't want to do that. So they want to have a
00:14:34 ◼ ► variety of configurations available in the store for you to buy. But there are limits to that. I
00:14:40 ◼ ► mean, they're physical limits. These are iMacs, so they're fairly large and you got to keep them
00:14:44 ◼ ► in the back, right? Like there's only so many iMacs you can store back there. - Air tags, we got them.
00:14:50 ◼ ► It's not a lot to say that you haven't already heard. Setup is really simple. I got some of the
00:14:56 ◼ ► Apple accessories. I think they look really nice. I got the key ring and I've got it on my keys.
00:15:02 ◼ ► All of those accessories are very... I've got the key ring and I've got a couple of the different
00:15:14 ◼ ► Very well made. - They're all so expensive. I was looking at like Belkin having like a $12
00:15:20 ◼ ► key ring and all that and I thought, "Well, that's more reasonable." It's a little bit ridiculous
00:15:25 ◼ ► that the AirTag doesn't have its own little hole for putting a key ring in, but at least there are
00:15:30 ◼ ► going to be some more low cost accessories like the Belkin thing because the Apple stuff,
00:15:36 ◼ ► while very nicely made, it's just like that's a lot of money for an AirTag. - They're expensive,
00:15:42 ◼ ► but I think it's like a fashion thing. I think they look nice. I have one of the Belkin ones
00:15:48 ◼ ► and it's fine, but it looks... So what I'll say about the AirTag, the AirTag, I have it in the
00:15:56 ◼ ► leather key ring and the brown. It looks to me like a really nice key ring. - Yes. - But the
00:16:02 ◼ ► Belkin one looks like I have a Bluetooth tracker on my keys. And I'm not saying that that's bad,
00:16:10 ◼ ► but it's just not what I want. - Yeah, no, and I think that's the rationale is that Apple stuff's
00:16:16 ◼ ► going to be expensive, but it's going to be nice. I think that's their goal anyway, right? Yes,
00:16:20 ◼ ► it's expensive and I'm glad there are other options because some people are going to look
00:16:25 ◼ ► at that and go, "Are you kidding me?" And other people are going to say, "Yeah, it's expensive,
00:16:28 ◼ ► but it's nice." And this is part of the thing that Apple does, right? You get somebody in a store and
00:16:34 ◼ ► they buy an AirTag and they're like, "Oh, well, we've got a key ring here." And they're like,
00:16:38 ◼ ► "All right, let's do it." And it costs a lot of money, but it does look good. And because there's
00:16:43 ◼ ► no doubt, I didn't pick up the key ring and think this is ridiculous. Well, I did. I thought the
00:16:50 ◼ ► price was ridiculous, but I didn't pick it up and go, "This is a bad value." It's like, no, it's
00:16:55 ◼ ► nice. It's just, I don't know if I would spend this money on something. It doesn't necessarily
00:17:01 ◼ ► feel like I need that level of niceness. I have a lot of crappy plastic key rings and they're fine.
00:17:08 ◼ ► But everybody gets to make their own decisions. - If you haven't bought AirTags yet, you're still
00:17:22 ◼ ► - So Apple sent me for evaluation a bunch of AirTags. And the sad thing about them is that
00:17:35 ◼ ► - I know that there's a lot of skepticism about engraving Apple products because it really is,
00:17:41 ◼ ► Apple offers free engraving and it's nice and all, but it also essentially means that it's a
00:17:44 ◼ ► lot harder for you to sell it to someone else because it's got your name on it. And so it
00:17:48 ◼ ► suppresses your resale value if you're somebody who resells your Apple products and all of that.
00:18:16 ◼ ► Then I had the Grimace in one on my backpack. - Yeah. And then you know it and it's like,
00:18:32 ◼ ► this is something they have been adding to it over time. I hope that they keep adding to it.
00:18:36 ◼ ► I understand why at the same time you can't just do any emoji ever, possibly ever. I understand why
00:18:47 ◼ ► For some reason, I thought you could share AirTags with families, but you can't do that.
00:18:52 ◼ ► It seems like all you can do if you're in a family is turn off the privacy protection thing.
00:18:58 ◼ ► So if you had a shared key, it's not gonna say, "Hey, you're being stalked," basically,
00:19:05 ◼ ► to the other person in your family. And I think that that's a misstep, and I would like to see
00:19:09 ◼ ► them add that. And I've seen some references. I think Steve Mosler was tweeting about this,
00:19:13 ◼ ► that there was some references to them adding this. But for example, I can, in Find My,
00:19:24 ◼ ► where her AirTag is. And honestly, that feels more important to me, like to find her bag,
00:19:40 ◼ ► It seems like a feature that they probably omitted while trying to get it ready to ship.
00:19:52 ◼ ► No, I know, I know. It's entirely possible that they got the software to a point where it was
00:19:56 ◼ ► shippable and they said, "Stop working on AirTags now," and that was two years ago. But yes,
00:20:20 ◼ ► Like, I know that this has been the two-year rumor, and it's really showing it. I mean,
00:20:25 ◼ ► and this is one of those to me where I just think they just lost an entire year, really.
00:20:31 ◼ ► Like, 2020 was just not the right time for this product, and I think that they held it for that
00:20:35 ◼ ► reason. They also had antitrust stuff that they were battling. I think they just waited it out,
00:20:43 ◼ ► Yeah. Yeah, they're, again, so much time spent on such a minor product, but they're fine.
00:20:53 ◼ ► And the Find My Network is cool, and having the ability to use it, because it's like every iPhone.
00:21:04 ◼ ► And the U1 support is excellent, the way that you do the little thing, and you, like, follow the
00:21:24 ◼ ► Well, I'm going to Arizona. I'm going to take my first flight that I've taken in more than a year,
00:21:33 ◼ ► and so I'm air tagging it. I got an air tag key. I got an air tag on my bag. I'm going to try not
00:21:47 ◼ ► Okay. If you do, that would be interesting, because you could watch where the air tag was
00:21:55 ◼ ► things really become popular, if you would have, like, you encourage your employees in the sorting
00:22:04 ◼ ► area to have iPhones so that they can track Find My Tags or something, do you mount, like, an iPhone
00:22:10 ◼ ► in your sorting room so that it can scan all of the little tags that come through and identify
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00:24:39 ◼ ► I remember them saying, "It's coming." And it was like a week or two before the Apple event.
00:24:45 ◼ ► Then the Apple event happened and I completely forgot that there was going to be the results.
00:24:51 ◼ ► Luckily, I don't have to do charts or listen live like you do. I just wait for you to do the work
00:24:56 ◼ ► for me. I check their little thing and put a calendar item in my calendar that says Apple
00:25:02 ◼ ► results. And then I know that that's the day. So yeah, yeah, they did. And they were interesting.
00:25:09 ◼ ► Shocking, I think. Probably the right phrase. Seriously, and I wrote about this, but I was not
00:25:17 ◼ ► using exaggeration. I think this is the first time that I've ever been covering Apple's results
00:25:29 ◼ ► Yeah, it's probably a Mac Club piece. You say, "This is the first time I've ever looked at the
00:25:33 ◼ ► numbers and thought some sort of clerical error had been made." I love that. I really love that.
00:25:42 ◼ ► one of their accountants is like on their little numpad and they're like, "Oh, no, we made a mistake."
00:25:51 ◼ ► But no, it was really like this. And it was a ridiculous quarter across the board. It's a
00:25:59 ◼ ► holiday quarter. That was really my takeaway is that a holiday quarter is safe. But it looks like
00:26:07 ◼ ► a holiday quarter. Apple's business is seasonal. The holiday quarters are their biggest quarters
00:26:11 ◼ ► ever. This quarter was almost as big as the 2019 calendar holiday quarter and bigger than any other
00:26:17 ◼ ► previous holiday quarter to 2019. It's the third best quarter Apple has had in its history.
00:26:29 ◼ ► I think Ben Thompson said in a Stretachery that he thinks this is, from his perspective,
00:26:35 ◼ ► Apple's best quarter ever because it's so good and unexpected. It's so aberrant from what we expect,
00:26:43 ◼ ► right? Because it's seasonal, this is why you do year over year comparisons instead of sequential
00:26:49 ◼ ► comparisons because sequential comparisons are always going to look bad in the second quarter,
00:26:53 ◼ ► except for this year, because the first quarter is the holiday quarter. And it's so great.
00:26:59 ◼ ► And this is, I know I've said this before, but this was the thing where I always had to convince
00:27:03 ◼ ► and explain to my bosses at IDG why Macworld's traffic was always down and disappointing.
00:27:10 ◼ ► Like every year they'd be like, wow, what's going on with your traffic going down? And I would have
00:27:14 ◼ ► to say, well, January is Macworld Expo. That's where Apple makes all of its product announcements.
00:27:21 ◼ ► It's the biggest month of the year. And we chart it. If you chart your chart starting in January,
00:27:28 ◼ ► we always look like we're going down, but we're not. That's the big month, January. And it's a
00:27:35 ◼ ► little like that. It's like, don't do it that way. You can't compare it when it's seasonal.
00:27:39 ◼ ► So this is arguably their best quarter ever when you view it as like up 54% in revenue over the
00:27:46 ◼ ► year ago quarter, because it's, yeah, it's their third biggest ever. And it's not a holiday quarter.
00:27:51 ◼ ► It's pretty well, it actually, I think also punctuates when we talk about how the Apple's,
00:28:00 ◼ ► Like it's really easy to lose sight of the fact that Apple is not remotely the company it was
00:28:06 ◼ ► when Steve Jobs was the CEO. It has grown so much, especially in its revenue that it's generating
00:28:18 ◼ ► a run of the mill quarter that is a $90 billion revenue quarter, which even two years ago
00:28:32 ◼ ► after the holidays. And there are reasons for it. And, you know, it's not necessarily repeatable,
00:28:42 ◼ ► So yeah, that, that is the other part of the story. So I want to give some stats to try and
00:28:48 ◼ ► put some of this in perspective because we have just some wild numbers. So the overall revenue is
00:28:54 ◼ ► 89.6 billion, which is up 54% year over year, which is bananas. The iPhone is 47.9 billion,
00:29:04 ◼ ► which is up 66% year over year, but this was expected. Yeah, this is, uh, that theory that
00:29:11 ◼ ► started with the iPhone six, really that, you know, what really drives iPhone sales is a new
00:29:16 ◼ ► design and that the S years, the, the interim years, the gap years are not as impressive because
00:29:22 ◼ ► a lot of people wait for the new look iPhone. And here we had a new iPhone, the iPhone 12.
00:29:27 ◼ ► And I think that this shows that theory being correct, that you create this cycle when you
00:29:34 ◼ ► change the look that drives a lot of sales. Um, and they, it also launched a little bit later,
00:29:40 ◼ ► which means that this, not all the sales fit in the holiday quarter. So some of them pushed into
00:29:44 ◼ ► the, uh, the March quarter. Yeah. And, uh, and that's why, you know, it was more than half of
00:29:51 ◼ ► their revenue for the, for the quarter. So 54% of overall revenue, and this is a stat that we've
00:29:56 ◼ ► been paying attention to more recently for, for a couple of reasons. We started paying attention to
00:30:00 ◼ ► it when it was going down and when, because it was going down because iPhone revenue was going down.
00:30:07 ◼ ► But now that that's mostly calmed down a bit, the 54% of revenue numbers still shows that like,
00:30:14 ◼ ► you know, Apple is the iPhone business, but that 54% revenue number when they've had such a good
00:30:21 ◼ ► for the iPhone, I think really says a lot about boosting their other products. Right. For sure.
00:30:27 ◼ ► Um, I also want to mention a little tidbit that Tim Cook had in the, uh, in the analyst call after
00:30:33 ◼ ► the results came out, which was that, um, he said the best selling model is the iPhone 12. He listed
00:30:39 ◼ ► a bunch of markets where Apple has the two big best-selling phones or the five best-selling phones,
00:30:44 ◼ ► like very much you, you make this kind of money because your product is a hit. However, um, he
00:30:50 ◼ ► said also the pro line is selling really well. And they talked a lot about mix, um, which suggests
00:30:55 ◼ ► that's like the mix of the product that it helped their margins, which I read as being like, we did
00:31:00 ◼ ► sell a lot of pros and the pros are more expensive. And so we made, you know, we, we made more money
00:31:06 ◼ ► because the mix was good. That one product that he didn't talk about was the, um, uh, 12 mini. Yeah.
00:31:11 ◼ ► So I think I'm going to have to buy the mini this fall because it might be the last one. I'm a
00:31:17 ◼ ► little worried about that. And I love it so much. The, the, all the rumor reports, the supply chain
00:31:22 ◼ ► reports suggest there'll be a mini this year and won't be one the year after. And that's that.
00:31:27 ◼ ► I reckon they'll keep it around on a multi-year refresh. It will replace the se. That's what I
00:31:32 ◼ ► reckon is going to happen. Yeah, I hope so. I hope so. Or, or at least that they'll just,
00:31:35 ◼ ► every couple of years, they'll throw a mini in, but, um, but yeah, I love the size. I was, um,
00:31:41 ◼ ► uh, moving some phones around in our house and rolling an older phone that I wasn't using down
00:31:46 ◼ ► and all of that stuff. And I was holding the standard size phones and thinking, I don't want
00:31:51 ◼ ► this. I really liked the mini size. So I guess it's me and a few of us, but not as many as maybe
00:31:58 ◼ ► Apple would like, but this is where it gets really interesting for me. The Mac $9.1 billion in
00:32:04 ◼ ► revenue that is up 70% year over year, making this the best Mac quarter ever of all time.
00:32:13 ◼ ► And the last three quarters are the three best Mac quarters of all time. Yeah. Up 70%. This and the
00:32:21 ◼ ► iPad growth year over year were the ones where I was like, surely this is a mistake. Up 70% year
00:32:28 ◼ ► over year. You know, the Mac has been doing pretty well and they've been showing some pretty good
00:32:33 ◼ ► growth on the Mac business, but 70% is not a number that has come out of that product line.
00:32:44 ◼ ► But that's how many Macs they sold. I assume that a lot of this is pandemic related and that has
00:32:50 ◼ ► driven sales of computers and iPads too. But I have to think that there's also some pent up
00:32:56 ◼ ► demand for the M1 happening here. I think it's pent up demand and also just that they've been
00:33:01 ◼ ► reviewed so universally well that I think people may be making purchasing decisions now that they
00:33:07 ◼ ► otherwise wouldn't have made. Just to be clear, the last three quarters the Mac has been up year
00:33:11 ◼ ► over year in the 20s. 22%, 29%, 21%. 70%. It's a lot. See, this is why I don't think that this
00:33:22 ◼ ► could be, could just surely be just like a pandemic related thing. Surely that purchasing's happened
00:33:28 ◼ ► by now. Like by and large. Like the majority of people that needed computers for the pandemic have
00:33:35 ◼ ► probably made that decision before now. I don't know. I don't know. They talked about it on the
00:33:40 ◼ ► call and I think that they said that certainly some amount of that is probably continues to be
00:33:44 ◼ ► this, which is like, you know, it's not everybody buys right away and maybe it's like, oh, as this
00:33:50 ◼ ► is worn on, we've been using this older PC or older Mac and we're going to update it and get a
00:33:58 ◼ ► new one now. But yeah, it's only part of the story here. It doesn't explain this on its own, I think.
00:34:10 ◼ ► Yeah. Again, if you look at the year over year changes that we've been seeing in the iPad,
00:34:15 ◼ ► it's been pretty good this year, this past four quarters, but it's been like 31%, 46%, 41%
00:34:20 ◼ ► year over year growth. And the previous cycle is sort of 17%, 22. It's been kicking around.
00:34:25 ◼ ► And then you get a seven up 79% year over year. It's just, it is a spectacular outlier as well.
00:34:32 ◼ ► And, however, we've been talking about records. We actually can't talk about iPad records because
00:34:37 ◼ ► the iPad early in the iPad era, when everybody thought, oh my God, this is going to be this huge
00:34:42 ◼ ► product for Apple. It's a whole new category. They were regularly doing, I mean, they did like
00:34:47 ◼ ► 10 billion several times with the iPad. So it's heights not seen since the early days of the iPad.
00:34:53 ◼ ► And then it went kind of like sloped down and then kind of flattened out and then it was come back up,
00:34:58 ◼ ► but it's not quite at the, at the sort of rolling four quarter average level of where it was at its
00:35:03 ◼ ► height, but it's actually kind of close. So this is another kind of hot, not quite high watermark,
00:35:08 ◼ ► but I guess recent high watermark for the iPad. I believe looking at the chart that you put in
00:35:13 ◼ ► Macworld, it is the second highest Q2. Yeah. I mean, it is, it is pretty remarkable. And all
00:35:22 ◼ ► of the records for the iPad are way back, right? They're all in the old way back. Different,
00:35:27 ◼ ► different. I had to do that on six colors. I just have this rolling timeline. That's like
00:35:31 ◼ ► four years, I think. And so for Macworld, I, I, I did the, the life of the iPad timeline
00:35:42 ◼ ► But as we mentioned, uh, Apple very specifically warning against supply shortages for the iMac and
00:35:53 ◼ ► are Apple going to be affected by this? Maybe, maybe not. No, it doesn't matter. You can have
00:35:58 ◼ ► all the money in the world. You can't get around this. Yeah. Tim Cook made the point in fact that,
00:36:03 ◼ ► uh, that this is what do you call it? Legacy nodes. I don't know. It's here's what it sounds
00:36:11 ◼ ► like. It sounds like there are a lot of, a lot of stuff that goes into a Mac or an iPad and less,
00:36:19 ◼ ► maybe to an iPhone. Um, and a lot of it is high tech cutting edge and one chip stuff like that.
00:36:34 ◼ ► literally everybody else in the world buys for their products. And those are the ones that are
00:36:39 ◼ ► in short supply. That's where Apple is bitten by this global shortage is that, um, as what Tim
00:36:46 ◼ ► Cook said was, um, Apple knows what its demand is, but Apple has no idea what all the other
00:36:57 ◼ ► industry's demand is. And so they can, Apple can do its planning, but this is a case where obviously,
00:37:03 ◼ ► despite having kind of all the money, Apple can't buy its way out of this one that there,
00:37:08 ◼ ► these components are in short supply and I'm sure Apple is spending what it feels like it,
00:37:12 ◼ ► it needs to, to try to get what it can from this, but there's, there's parts that they need
00:37:18 ◼ ► that to build their systems that they can't get. And so their, their Mac and iPad specifically will
00:37:29 ◼ ► but that they've got enough iPhone inventory, uh, that it doesn't matter. One of the things that an
00:37:34 ◼ ► analyst asked Tim Cook is how did you manage to ship so many of these given the shortages?
00:37:39 ◼ ► And the answer was something like, we basically blew through all of our contingency margins,
00:37:44 ◼ ► all of our buffer. We crushed it in order to ship these. So that's great. But now they're saying,
00:37:50 ◼ ► essentially it's gone. And so we're not going to be able to fulfill, fulfill demand. It's also an
00:37:55 ◼ ► important message for them to send to the, the financial people. Cause the whole point here is
00:37:59 ◼ ► that as a public company, they're trying to give some sort of sense of how the business is doing
00:38:03 ◼ ► and where it's going. So it's important for them to say, we don't actually see demand lagging for
00:38:09 ◼ ► the Mac and the iPad so much as we can't make enough. Now demand might not be at the level that
00:38:15 ◼ ► it was this quarter because it's a remarkably high level, but whatever the level of demand
00:38:19 ◼ ► Apple anticipates for the iMac and the, or for the Mac and the iPad in general, it's, uh, it's,
00:38:27 ◼ ► it's not enough. They can't fulfill that demand. So it's out of balance. They can't make enough.
00:38:32 ◼ ► And so they said our iPad and Mac sales figures will be lower next quarter, just because if,
00:38:39 ◼ ► if for no other reason, it will be suppressed by the fact that we can't make enough people want to
00:38:44 ◼ ► buy them and we can't make enough of them. It's not a terrible problem to have, but it's not great.
00:38:50 ◼ ► You really, if somebody wants to give you money for a product, you want to be able to give you,
00:38:53 ◼ ► give them the product. Talking about components, I'll get, I'll get back around to that. I'll
00:38:59 ◼ ► explain margin changes. So one of the things that's been made quite, uh, quite the to do of,
00:39:06 ◼ ► and a lot of business press, especially is that Apple's gross margin has changed for their
00:39:12 ◼ ► products, um, in this quarter. So Apple's gross margin has been steady around 38% for a very,
00:39:21 ◼ ► very long time, multiple years, multiple quarters, multiple years. It's kind of just been known
00:39:25 ◼ ► Apple's gross margin is 38%. That's just what it is. However, in the last couple of quarters,
00:39:31 ◼ ► it started to creep above 40 now hitting 42.5% this quarter, which is a significant difference.
00:39:38 ◼ ► You know, it's been 38% for such a long time, and now we're up to 42.5. And this has been attributed
00:39:44 ◼ ► in part to cost savings, which I think quite clearly is going from Intel to the M1, right?
00:39:51 ◼ ► Especially in the Mac. Yeah, it's gotta be at least partly ascribable to the fact that they're
00:39:59 ◼ ► not paying Intel. I mean, it's not like the M1 doesn't have costs. They're like, oh, it's Apple's
00:40:04 ◼ ► processor. It's free. It's not. They have to pay a Taiwan semiconductor to make it. They have to
00:40:09 ◼ ► amortize the cost of their chip development. Although there they get to amortize their chip
00:40:14 ◼ ► development over the Mac and the right, like the Mac is now part of that calculation. When
00:40:20 ◼ ► previously the Mac was straight up just like Intel and Apple's chip design team, like they could
00:40:38 ◼ ► price Apple is paying for all those Intel processors and Intel's markup, like that's gone.
00:40:44 ◼ ► So it's presumably a lot cheaper for Apple to make its own processors than it was to buy Intel's.
00:40:50 ◼ ► And that's got, that's going to roll into into margin given that they didn't really change the
00:40:54 ◼ ► prices of the products. That's got to just roll into profit margin. Services is $16.9 billion,
00:41:03 ◼ ► which is up 27%. Yeah. This is a more in line figure for services. Services has been growing
00:41:10 ◼ ► at 20 plus percent for a while now. It's kind of wild, but that's just what it is. It looks
00:41:18 ◼ ► less this quarter because of these gaudy numbers put out by the Mac and the iPad, but it's still
00:41:23 ◼ ► just, you know, that services business is chugging along. It's almost 17 billion a quarter now.
00:41:27 ◼ ► And as I like to remind people, keep in mind the services business doesn't have 42% profit margin.
00:41:34 ◼ ► It has in the seventies profit margin. It's just all profit for Apple. Like it's Apple spends very
00:41:41 ◼ ► little to make enormous amounts of money on services, relatively speaking. And that's one
00:41:45 ◼ ► reason you want to grow a services business is it's vastly more profitable. Like every dollar
00:41:50 ◼ ► you make in services, you, you, you take away more profit than you do from every dollar you make
00:41:54 ◼ ► selling iPhones. It's bottom line. So, um, and then Zach has one in the discord still up 27%
00:42:06 ◼ ► Yeah. Well, remember all the, all the reports that we had about that was really great for
00:42:14 ◼ ► store, which is in those big companies. It's just proving that point, right? Yeah. Yeah.
00:42:25 ◼ ► Yeah. And they said a bunch of positive things about Apple watch that a lot of the people coming
00:42:28 ◼ ► to Apple watch are still new people who've never bought an Apple watch before that that's a large
00:42:33 ◼ ► component of the Apple watch sales and that AirPods are doing well. And they, they didn't,
00:42:37 ◼ ► they didn't really give it a lot of color, which makes me want to peer at it a little bit and say,
00:42:42 ◼ ► well, what does that mean? But the fact is it was up 25%. And I think they had so much else going on
00:42:46 ◼ ► that they really just sort of said, yeah, it's, it's doing great. And the other thing they said
00:42:50 ◼ ► is, and AirTags are now part of this family. I'm like, all right. Okay. Yeah, that's true. All
00:42:54 ◼ ► right. And Tim was asked a question by one of the analysts about regulatory issues being a potential
00:43:01 ◼ ► risk to Apple in the future. Tim said that like Apple and their rules and all that kind of stuff
00:43:07 ◼ ► is not casting concrete and it moves with the times. Yep. Apple's just out there moving with
00:43:14 ◼ ► the times. They're not casting concrete at all. They're, they're, they're moving with the times.
00:43:20 ◼ ► This seemed to me like you and I have talked about the fact that it's funny, Apple makes that change
00:43:26 ◼ ► with the small business program. And you're like, oh, this is interesting. And then when Tim talks
00:43:31 ◼ ► to Kara Swisher or something, he says, he says, oh, you know, that's not true about us at all.
00:43:37 ◼ ► that's why you did it. This is, this seems very much like a message being sent by Tim Cook,
00:43:44 ◼ ► because the question here that I thought was really good was one of these analysts who,
00:43:48 ◼ ► you know, they're so focused on the details of supply chain and, you know, and, and gross margin
00:43:54 ◼ ► and how many basis points and OPEX and foreign exchange and all of these things about like big
00:43:59 ◼ ► business. And sometimes you, you think, are they thinking larger about regulatory environment and
00:44:07 ◼ ► the fact that Apple's business might be dramatically changed if a court or regulator or something
00:44:13 ◼ ► forces them to change their business model. And this question was about that. It was framed as
00:44:17 ◼ ► like a big philosophical question and got this answer out of Tim Cook, which is, I think not
00:44:22 ◼ ► what the question wanted, but, wanted to get out of him, but it was something really interesting.
00:44:36 ◼ ► When he says move with the times, I mean, what, what are the times? It's not like there's just
00:44:41 ◼ ► the zeitgeist it's like, oh yeah, in the spirit of the age, now you take less, yeah, larger companies
00:44:47 ◼ ► will take less money from the people who are filling its app stores. No, that's not it.
00:44:51 ◼ ► The spirit of the age is that all the politicians in all the major economies are talking about
00:44:57 ◼ ► big tech being a problem. And when Apple comes up, it comes up in the context of it being a
00:45:12 ◼ ► that's the spirit of the age. That's why Apple needs to move with the times is it's really him
00:45:16 ◼ ► saying we'll make changes if we have to because everything is, you know, the walls are closing in.
00:45:22 ◼ ► Multiple concurrent high profile legal cases that good money bet on would suggest they're not going
00:45:29 ◼ ► to win. We're going to talk about one of them in a minute, but like, that's the time that we're in,
00:45:34 ◼ ► right? So like, yeah, it probably is going to make a difference. How much of a difference?
00:45:39 ◼ ► Dunno. Depends how much of a difference is pushed on them. And that's, that's what they're moving
00:45:43 ◼ ► with. What they're moving with is what will the courts of the world tell them they have to do?
00:45:48 ◼ ► And they'll go with that. Yeah. Yeah. You know, we're just not casting concrete. Like if they
00:45:53 ◼ ► force us to change, we'll change. Well, and I actually think it's, it's the truth, right? Is,
00:45:58 ◼ ► is that this is what's going on. And also the truth is you never want to be, this is like when
00:46:05 ◼ ► any company or industry sees that the jig is up and like, Oh, they're going to regulate us. Right?
00:46:09 ◼ ► Like we spent 20 years saying, don't regulate us. This isn't an issue. And finally, and that wasn't
00:46:16 ◼ ► true. It was an issue. And finally, the, the spirit of the age, the, the, the courts and the
00:46:23 ◼ ► politicians and all that have decided they're going to do something about it. That's when you
00:46:27 ◼ ► as a company or an industry come to the table and say, you know, you're right. Something should be
00:46:31 ◼ ► done. Here's what we propose because what you want to do is control how your business changes
00:46:38 ◼ ► and, and, and offer things of like, what can we do that will satisfy you so that you will go away
00:46:43 ◼ ► and not bug us and ruin our business. What you don't want. Is it's like a, like a contract
00:46:50 ◼ ► negotiation or any other legal kind of like negotiation. It's like, you want to come to
00:46:55 ◼ ► an agreement because failing that the judge is just going to make a, is going to sentence. You
00:47:03 ◼ ► Apple wants to change with the times and, and take itself out of the concrete, just enough to get
00:47:09 ◼ ► everybody off their backs. And, and just enough that when the, the legislatures or the, or the
00:47:16 ◼ ► regulators look at what they're doing, they're like, yeah, it's not so bad. It's fine. And like,
00:47:21 ◼ ► it just removes enough wind from their sales that Apple is able to escape without being
00:47:27 ◼ ► told something told to do something that they feel is more catastrophic to their business.
00:47:41 ◼ ► I start to look at stuff like that and think Apple's going to have a response here. And it's
00:47:46 ◼ ► probably going to be something like what they did with Amazon, right? They're going to say,
00:47:50 ◼ ► Oh, new program. This is from music services. Music services. Now we've got a new program
00:47:56 ◼ ► where they can use their own in-app purchasing. We're, we're allowing that now, like they did
00:48:01 ◼ ► with Amazon for, cause you can buy movies and rent movies in the Amazon app on iOS and TVOS, right?
00:48:06 ◼ ► Like that's, that that's a break, but no, no, no, it's a special program, but Apple will be able to
00:48:12 ◼ ► do special programs for a lot of these things that are like the big pain points and get enough heat
00:48:20 ◼ ► off of them. At least that's their hope that they can, they can escape without having to have bigger
00:48:26 ◼ ► issues. I do think that they've also got like, there's, they've got other trap doors that they
00:48:32 ◼ ► can use, but like, and so we should talk about this more in the next segment, but like Tim Cook's
00:48:37 ◼ ► statement there, I don't know. It just really hit me that like, it's such without saying much,
00:48:44 ◼ ► he is laying it out there that Apple will make changes when it has to and already has started.
00:48:53 ◼ ► Because they know they're not going to, they're not going to get away with it, right? They're
00:48:59 ◼ ► not going to get away with it. They can't, they spent a lot of time saying basically like, look,
00:49:04 ◼ ► we don't make the rules when they made the rules and make a lot of money. And now they realize that
00:49:11 ◼ ► the business as usual isn't going to work for them anymore, probably. And so they're probably
00:49:14 ◼ ► going to have to make some concessions or they're going to be forced to change. And I think the real
00:49:18 ◼ ► question is, is it too late or not? Have they pushed this too far or is there still time for
00:49:25 ◼ ► them to sort of make concessions that will get the scrutiny off of them? This episode is brought to
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00:51:53 ◼ ► So I think, Jason, it might be too late for Apple to try and squirm out some of this stuff.
00:51:59 ◼ ► - The wall's closing in, yeah. Yeah, it might be. It might be. I mean, you never know. They're a big
00:52:05 ◼ ► company with lots of money, but it does feel a little bit like they waited a little too long,
00:52:17 ◼ ► it has been going...Spotify raised a case with the European Commission back in 2019. It was their
00:52:24 ◼ ► time to play fair campaign that they started. It feels like a million years ago, but now we're
00:52:29 ◼ ► actually getting the ruling of this kind of legal proceeding. So the European Commission is issuing
00:52:36 ◼ ► charges of antitrust against Apple, in Spotify's case, for unfair practices in the streaming music
00:52:43 ◼ ► business. The European Commission says Apple has a dominant position in the market for the
00:52:48 ◼ ► distribution of music streaming apps through its app store, and Apple's rules distort competition
00:52:54 ◼ ► in the market for music streaming services by raising the costs of competing streaming app
00:53:04 ◼ ► but don't think they should have to pay for anything for it. Spotify has become the largest
00:53:10 ◼ ► music subscription service in the world, and we are proud of the role we played in that.
00:53:15 ◼ ► That makes me so mad to read stuff like that. And Apple has argued that the revenue contributes
00:53:25 ◼ ► privacy, and security policies. - Yeah, Apple's argument, which I think is...I mean, there's some
00:53:34 ◼ ► truth in it, but I think it's an incredibly self-serving argument. Apple's basically like
00:53:47 ◼ ► everybody loves their iPhone. What if Spotify wasn't on the iPhone?" We, through our great
00:53:52 ◼ ► largesse as a company, built a software development kit and an app store and all of these developer
00:54:00 ◼ ► tools that allowed Spotify to make an app on our wonderful phone so that they could build
00:54:05 ◼ ► their business. And of course, missing from that is that the value accrues to the iPhone
00:54:10 ◼ ► from third-party apps and that if you couldn't use Spotify on your iPhone, it's less valuable.
00:54:40 ◼ ► third-party developers and building the app store, right? But Apple has also made it mandatory.
00:54:46 ◼ ► And so it's not just supporting the app store, it's supporting the thing that we force you to use.
00:54:51 ◼ ► And there's a lot of complexity here. And I don't... - Well, you see, Jason, I agree with you.
00:54:59 ◼ ► where it becomes a problem is why it's in the European Union, like in the European Commission,
00:55:04 ◼ ► is because then Apple launched their own music streaming service, which they priced the same
00:55:08 ◼ ► amount of Spotify, and Apple doesn't pay 30% to anybody else. - Yes. And this is the core
00:55:14 ◼ ► issue with a lot of the stuff where Apple has built a competitor, is Apple has built a competitor
00:55:20 ◼ ► on its platform where the rules don't apply to it. Because there's no... The rules don't apply
00:55:24 ◼ ► to Apple that it needs to share 15 or 30% to a third party, right? It's the third party,
00:55:31 ◼ ► it pays itself. Whereas everybody else who's competing with it has to pay Apple or has to
00:55:36 ◼ ► degrade its user experience and kick people out of the app and have people go somewhere else and
00:55:41 ◼ ► sign up and then log in, which is doable. - Well, they wish they could kick somebody out,
00:55:44 ◼ ► but they're not even allowed to do that, right? Like they're not actually allowed to say go
00:55:48 ◼ ► somewhere else. - Functionally, they kick you out because you can't do it there and you have to go
00:55:52 ◼ ► somewhere else and you have to figure that out, right? But that's the thing is that Apple...
00:55:56 ◼ ► And this is not the first time, right? Because the Kindle books and iBook store are a good example
00:56:00 ◼ ► of this. Like these examples continue to exist where Apple has built a service that competes
00:56:06 ◼ ► with other services, but with one key difference that Apple doesn't have to pay the middleman
00:56:14 ◼ ► because it is the middleman. And that distorts as the EU said, that distorts competition
00:56:21 ◼ ► because of the App Store rules or, alternately, the degraded user experience. Because the App
00:56:26 ◼ ► Store rules functionally bar you from using Apple's payment methods, depending on the margins of your
00:56:32 ◼ ► business. Essentially, you take all your profit has disappeared into Apple's pocket. And so,
00:56:37 ◼ ► therefore, you degrade the user experience and you push people away and say, "You've got to go
00:56:42 ◼ ► to the web in order to pay for our thing because we're not going to charge you in app because we
00:56:47 ◼ ► would have to give 30% to Apple." So this is the preliminary conclusion. Apple now has a 12-week
00:56:56 ◼ ► period to respond to this preliminary conclusion before then a judgment will be given. If the
00:57:04 ◼ ► judgment is found, like if the judgment matches the preliminary conclusion, Apple will face a couple
00:57:11 ◼ ► of things. One would be a potential fine. This fine for antitrust in the European Union could
00:57:18 ◼ ► be for up to 10% of Apple's revenue from the previous year, which could be a fine of $27
00:57:24 ◼ ► billion, which is a lot of money. But the bigger hit, honestly, could be a requirement for Apple
00:57:31 ◼ ► to change the way they conduct their business in at least the European Union. Now, I wanted to say
00:57:37 ◼ ► to you, you were mentioning a minute ago about you expect Apple to suggest some change to their
00:57:45 ◼ ► business like the way they did with Amazon. Are you expecting that they would do this within that
00:57:57 ◼ ► - I don't know about the timing of it at all, but it just struck me that what the European
00:58:06 ◼ ► Commission may want and what Spotify may want and what a lot of other parties want is Apple to drop
00:58:13 ◼ ► the demand that all financial transactions for digital goods be processed through Apple.
00:58:26 ◼ ► - Well, 27 billion is a lot of dollars. If it's a one-time payment, Apple can handle it, right?
00:58:30 ◼ ► The real threat to Apple is long-term change of their business model. So changing everything
00:58:37 ◼ ► is probably the easy way out that everybody wants except Apple, right? But it would be very
00:58:43 ◼ ► interesting, I guess, if Apple were to take a targeted approach to deal with this issue.
00:58:58 ◼ ► "Why is that only video? Why is it not Amazon's books? Why is it not Amazon Music? Why is it only
00:59:05 ◼ ► video?" And I don't know. I think the answer may be because they had a partner somewhere in some
00:59:10 ◼ ► country and they wanted to make this deal, but they created a special program. And it means that
00:59:13 ◼ ► Amazon will charge your credit card to buy or rent a digital good in the app store. And that is
00:59:25 ◼ ► So I look at this and I think it really wouldn't be other than the principle of the thing. But
00:59:30 ◼ ► if Apple's lawyers are like, "This is not going our way," right? It would not be inconsistent with
00:59:36 ◼ ► their past behavior to say, "What if we make an exception for streaming services?" Or, "What if
00:59:43 ◼ ► we make an exception for any service in a category that competes with Apple's own services that allows
00:59:51 ◼ ► them to have some different rules?" And would that resolve this? Would that get them off their back
00:59:58 ◼ ► or not? I don't know. But it is in the list of things that I think in terms of Apple moving with
01:00:04 ◼ ► the times, long hair is in, disco is back, whatever the times are, I don't know, for them to offer
01:00:12 ◼ ► stuff like that. That's not wholesale. We give up. Because what does the small business program tell
01:00:17 ◼ ► us? In addition to the video program with Amazon, what does the small business program tell us?
01:00:23 ◼ ► Small business program tells us that Apple doesn't want to give it all away, but is willing to give
01:00:30 ◼ ► a little part of it away in order to keep the bigger part, to lose the battle but win the war.
01:00:35 ◼ ► And so I look at the Spotify thing and I think, "Well, they could do that." That would be a way
01:00:42 ◼ ► for them to get this off their back completely and potentially in other categories too, to just
01:00:48 ◼ ► be like, "Yeah, yeah, yeah. If we do it, you can do it. If you have a fitness service, you can be
01:00:54 ◼ ► in this program. If you have a bookstore, you can be in this program." Anything that we do a service
01:00:58 ◼ ► about, "All right, you can be in this program and then you don't have to pay us." Or you have to
01:01:03 ◼ ► offer in-app purchase or whatever the rules are. Can we get away with something that gets...
01:01:10 ◼ ► Because that's their goal. Their goal is to get away with as little change as possible,
01:01:14 ◼ ► but release all the pressure on them. And I don't know if they can do it in time. I don't know if
01:01:19 ◼ ► they're inclined to. I don't know if it will allow them to escape. But it seems to me that there are
01:01:23 ◼ ► ways for Apple to kind of like try to finesse this in order to avoid the hammer. The hammer may hit
01:01:29 ◼ ► them anyway, but I feel like there are ways that they could do it. That would be one of them,
01:01:33 ◼ ► would be like, "Oh, Spotify, Tidal, Amazon Music, you all can now use your own thing because we have
01:01:43 ◼ ► During this 12-week period in which Apple needs to respond to the European Commission in regards to
01:01:49 ◼ ► the case of Spotify, they're also going to be in court with Epic. That starts when this episode is
01:01:55 ◼ ► released. Today, it'd be about a three-week period of time. This is a much more exciting case from
01:02:03 ◼ ► the sense of everyone's involved. The witness list is a who's who, and it's full of people.
01:02:16 ◼ ► Then they're going to be bringing in a bunch of the most high-profile people possible. Everyone's
01:02:24 ◼ ► a witness. This one is going to be fascinating. The amount of stuff and details we're going to
01:02:30 ◼ ► find out is going to be so exciting. I can't wait. Yeah, it's going to be interesting to watch.
01:02:36 ◼ ► This one, again, not a lawyer, but when I look at the details of this case, I remain skeptical.
01:02:41 ◼ ► A judge can decide whatever. I feel like Epic... I don't know. I'm skeptical of Epic's case here,
01:02:54 ◼ ► all the dirty laundry is going to be out there. To mix metaphors, blood will be in the water,
01:03:05 ◼ ► it's going to be not a good thing for Apple. Yes, I agree. I think it's going to be tough,
01:03:10 ◼ ► because it's going to be more ammunition, more evidence for whatever politicians want to talk
01:03:17 ◼ ► about regulating Apple. It's funny, because a lot of the conversations about big tech being
01:03:22 ◼ ► too powerful are about things that really aren't about Apple at all. Apple has done enough to make
01:03:29 ◼ ► enough people angry about these issues that Apple gets rolled in with the rest and all those other
01:03:35 ◼ ► conversations. Then they come to Tim Cook and it's like, "We don't want to talk to you about
01:03:39 ◼ ► social media. We just want to talk to you about the App Store." Apple's good on the things that
01:03:46 ◼ ► a lot of the other companies are bad on. They're good on the social good issues, right? Part of
01:03:51 ◼ ► this is also just because they don't have a social network, right? If Apple ran their own social
01:03:56 ◼ ► network, they would probably be in some of the same problems that Twitter and Facebook are in,
01:03:59 ◼ ► around speech and all that kind of stuff. The only argument that Apple gets there is that,
01:04:03 ◼ ► with the curation of the App Store, they're accused of kicking Parler out of the App Store and things
01:04:08 ◼ ► like that, because the argument there would be their complete control of the App Store means
01:04:13 ◼ ► that if you're not in Apple's good graces, you are lost in the platform and there's nothing you
01:04:22 ◼ ► is, in addition to the Spotify program, essentially, that allows music services to bypass Apple, and
01:04:38 ◼ ► Apple spent the last few years building Gatekeeper and Notarization and all of these other things in
01:04:44 ◼ ► the Mac App Store, and the context has been, "How do you provide App Store-level control and curation
01:04:50 ◼ ► without having a 'you must use the App Store' approach that they have on iOS?" And the way
01:04:56 ◼ ► that's always been pitched is, "Well, the Mac doesn't have that model. The Mac lets you download
01:05:02 ◼ ► and run anything, and so how can Apple make the default more like the App Store without it actually
01:05:07 ◼ ► being everybody has to be in the App Store?" And that's all true. And to Apple's credit, they have
01:05:14 ◼ ► said publicly that if you want to run software on your Mac, you can. You just sort of have to go
01:05:19 ◼ ► through some hoops, but you can. However, as a part of all this, I've started to wonder,
01:05:25 ◼ ► "Is that also Apple having a trapdoor for sideloading on iOS?" Because if Apple were forced
01:05:35 ◼ ► to sideload on iOS, forced to allow apps that are not in the App Store to be installed on iOS,
01:05:39 ◼ ► I wonder if this would be the way that they would do it, right? That they would say, "Okay, well,
01:05:44 ◼ ► here's what we're going to do, is we're going to do what we do on the Mac, which is an open platform,
01:05:48 ◼ ► and we've got all this technology already. You've got to have a membership, and you have to
01:05:52 ◼ ► notarize, and then there's a setting you have to turn off, and you have to go through a warning
01:05:59 ◼ ► screen," and all of those things that are barriers. And I'm not sure they will get to that point,
01:06:05 ◼ ► or they will even be allowed to get to that point. But I start to wonder, is that all in play, too,
01:06:19 ◼ ► If I was going to give a fun upgrade, conspiracy theory, I would not be surprised if a couple of
01:06:28 ◼ ► days before WWDC, they announced massive changes to the App Store. Yeah. Yeah. Which is, you know,
01:06:39 ◼ ► they did it a couple of days before, which was really smart, because they didn't make the whole
01:06:42 ◼ ► presentation about that one thing. You kind of get it out there. It's around the time people
01:06:46 ◼ ► are thinking about it. I just think that the wagons are circling, the bloods in the water,
01:06:56 ◼ ► if they make it out of these two cases somewhat intact, I just think that you cannot be as smart
01:07:05 ◼ ► as those people are in that building and not realize that you just don't have a lot of legs
01:07:10 ◼ ► to stand on anymore. Even if you think you're right, it's very clear now that there is a lot
01:07:16 ◼ ► of money in trying to prove you wrong. Well, Apple's take on this was always, if it ain't
01:07:22 ◼ ► broke, don't fix it. It's also why they didn't address some really obvious problems with the
01:07:27 ◼ ► App Store, including the fact that it's built on iTunes and it's a hit single model. So,
01:07:31 ◼ ► like, you can't sell upgrades, you still can't sell upgrades. And they've got this subscription
01:07:35 ◼ ► model that they're doing now and apps are adopting that, not necessarily because they want to,
01:07:40 ◼ ► but because that's how they have to do it, because that's what Apple has decreed, right?
01:07:44 ◼ ► Apple has, for a long time, I would actually argue until Phil Schiller kind of took over the App
01:07:50 ◼ ► Store, there was a period there where Apple literally had no introspection of the App Store.
01:07:55 ◼ ► They never thought about what could be better, because why? Winning is, as the saying goes,
01:08:02 ◼ ► a great deodorant. They were making so much money that it didn't matter. And that arrogance
01:08:08 ◼ ► has continued, right? Like, they're so successful, they make so much money, we just talked about it,
01:08:13 ◼ ► that, like, who's going to stop us? It's really the attitude. It's like, we have this great
01:08:17 ◼ ► platform, people love it, the users love it, the users love the apps, the developers will go along
01:08:21 ◼ ► and do what we say, who's going to stop us? And I imagine there was a little voice inside Apple,
01:08:28 ◼ ► somebody saying, "The courts will stop you, the EU is going to stop you, the politicians are going
01:08:33 ◼ ► to stop you, somebody's going to stop you." And it probably took too long for that voice to be heard
01:08:38 ◼ ► enough for them to realize it. But when Tim Cook says, "We're going to move with the times,"
01:08:43 ◼ ► I feel like that voice has been heard now, right? But as we said, is it too late? But yeah,
01:08:48 ◼ ► yeah, they've gotten to the point now where they realize who's going to stop us is the courts and
01:08:53 ◼ ► the law and the governments are going to stop us. And we are going to need, like I said, to scramble
01:09:01 ◼ ► to try to make it look like we're responding to criticism in a benevolent way. We've listened
01:09:07 ◼ ► to your questions about this. And so we've got an exciting new program that allows more freedom,
01:09:13 ◼ ► isn't it great? And, you know, gritted teeth, they don't want to do it. But I do think we've
01:09:18 ◼ ► reached the point where Apple's going to start rolling a bunch of things out that they hate,
01:09:22 ◼ ► but they know that they have to do it because the alternative is worse, right? The alternative is,
01:09:26 ◼ ► you can't run an app store anymore, or you can't write apps for your own platform anymore,
01:09:30 ◼ ► or something that's really bad, like really, really, really bad to their, you know, future
01:09:36 ◼ ► as a company. And so they will make concessions. And yeah, I wouldn't be surprised if it happens
01:09:41 ◼ ► soon, given what's going on here. But yeah, we'll see. And I want to be clear, although I
01:09:48 ◼ ► appreciate Apple talking about the importance of iOS and the App Store and curation and security
01:09:55 ◼ ► and all of those things. One, Apple hasn't done a really great job with curation on the App Store.
01:09:59 ◼ ► There's a lot of garbage and scams and stuff in there. So they don't really have as strong
01:10:03 ◼ ► an argument as they would have if they had to get back to the, "It doesn't matter if we're making
01:10:08 ◼ ► so much money" argument, that they could have made a better argument if they had policed the
01:10:13 ◼ ► App Store better, but they didn't. And two, I appreciate that on the Mac, I can run any software
01:10:19 ◼ ► I want. I don't like the fact that there are, you know, emulators and stuff that run on iOS that you
01:10:24 ◼ ► can't use unless you jailbreak or use other weird means of exploiting iOS bugs in order to install
01:10:30 ◼ ► software. Like, it's not for everybody. Of course, there will be abuse. There's abuse on the Mac now.
01:10:35 ◼ ► That's how malware spreads on the Mac, is they tell you how to turn off all the security while
01:10:40 ◼ ► you're installing the app. Like, I get it. It's not a great situation in terms of that. At the same time,
01:10:46 ◼ ► do I think that iPad and iPhone might be, you know, better if you had, you know, the ability to install
01:10:56 ◼ ► third-party apps on it that didn't go through Apple? Yeah. Yeah, it would be more dangerous, yes.
01:11:02 ◼ ► It would also be better. And Apple would have to compete. That's the other thing. Apple would have
01:11:08 ◼ ► to compete on user experience and say, "Well, you know, it's better to do it our way because it's
01:11:15 ◼ ► easier and faster." It's like, "Yeah, okay, but you have to compete now." Talking about subscriptions and
01:11:23 ◼ ► revenue splits and all that kind of stuff, let's check back in with Apple Podcast subscriptions.
01:11:29 ◼ ► Yeah. This is something we spoke about a couple of weeks ago. And, you know, the dust has kind of settled
01:11:33 ◼ ► on this. I think that by this point, we both kind of feel pretty similarly. Like, this is a somewhat
01:11:40 ◼ ► decent, in some instances, pretty good arrangement for certain types of podcasters. Yeah. I wrote a
01:11:47 ◼ ► piece about it on Six Colors. I think it's a 1.0 product, essentially. There's a lot of good stuff
01:11:52 ◼ ► in there. Anybody who's been through what we've been through in launching subscription services,
01:11:58 ◼ ► you know, for podcast support, it's hard. And there are a lot of people out there who are
01:12:02 ◼ ► podcasters who are not going to do the technical work. It's just too much who can do this program
01:12:07 ◼ ► and allow their listeners who are, you know, presumably a lot of them on Apple Podcasts in
01:12:13 ◼ ► order to get money from them in an easy way. There's stuff that it should do that it doesn't
01:12:19 ◼ ► currently do that we covered. But, you know, I don't want to make the mistake of saying sort of
01:12:25 ◼ ► like, "Well, it's not for me and therefore it's irrelevant," because that's not right. Like, it
01:12:28 ◼ ► has some interesting aspects, although I think it could be better. What struck me, though, when I
01:12:35 ◼ ► was writing that piece, and the piece is very much like, "Here's what's good about it. Here's what
01:12:38 ◼ ► needs to change." And then the last section is, but here's why it really actually kind of makes me
01:12:42 ◼ ► angry, is all the other things we just talked about, which is App Store rules mean that nobody
01:12:51 ◼ ► can ever compete with this product on iOS. Because no podcast app can put a feature—first off,
01:13:00 ◼ ► there's some technical issues regarding in-app purchases and how those are handled that are very
01:13:04 ◼ ► complicated and would be very hard to overcome. But assuming you could overcome them, if you're
01:13:09 ◼ ► Overcast or Castro or PocketCasts or anybody else, to make it as easy as an in-app purchase,
01:13:16 ◼ ► you have to hand all the money to Apple. And at that point, one of two things happens. Either
01:13:25 ◼ ► because you're competing with Apple, who's paying itself. Or you have to change the pricing,
01:13:30 ◼ ► and that means you are more expensive than Apple, and that's not great. Or you take your cut out of
01:13:38 ◼ ► what you give to the podcaster, and now the podcaster is joining your program but making
01:13:42 ◼ ► less money if they're in your podcast app. And it just—fundamentally, the App Store rules lead
01:13:48 ◼ ► to a situation where Apple is able to launch features and services on iOS that cannot be
01:13:56 ◼ ► competed with directly because of the App Store rules. And that—this is the same argument, right?
01:14:05 ◼ ► It's the same argument, which is Apple has created a method where they take a percentage. Anybody
01:14:10 ◼ ► else who could implement it would have to pay Apple the same percentage, as if Apple's work
01:14:15 ◼ ► on that was the same as Apple's work on their own product. And as a result, Apple has built a barrier
01:14:20 ◼ ► there where basically only Apple can do it in a way that makes any sense. Now, the way we make it
01:14:26 ◼ ► work is like an interesting gray area where we put a link in our show notes that go in every single
01:14:34 ◼ ► podcast client, which you can click, and it could take you to a checkout page, and you sign up,
01:14:38 ◼ ► and then you get given an RSS feed, and you go back to your app and put it in. Now, Apple's not
01:14:43 ◼ ► taking any of that because it's not going through the App Store. It's nothing to do with the
01:14:49 ◼ ► application. It is an outside transaction, right? So like if you're listening in Pocket Casts right
01:14:55 ◼ ► now and you click the link, Pocket Cast is not involved in this transaction at all, so no money
01:14:59 ◼ ► is owed to Apple, right? Now, this is like an interesting kind of gray area, but like Pocket
01:15:07 ◼ ► Cast can't do it themselves, right? They can't say, "Hey, we're going to handle these subscriptions
01:15:12 ◼ ► for you now," because if they did that, they wouldn't make any money out of it because they'd
01:15:16 ◼ ► have to pay Apple 30% and then they'd have to give us the rest basically to remain competitive.
01:15:21 ◼ ► And, you know, some apps, including Overcast, used to have a little button that you could tap,
01:15:28 ◼ ► and it would sense for a tag that was attached to any kind of subscription field, which we used to
01:15:35 ◼ ► do, but that's since gone away because it just wasn't used. It wasn't standardized, so we never
01:15:41 ◼ ► mentioned it. Nobody ever mentioned it. It was just a thing that was there. Well, and the truth
01:15:44 ◼ ► is also, when Marco put that in, he knew that if Apple called him on it, he'd have to remove it
01:15:50 ◼ ► because technically, even though it's not his money, like it's one of those things where fear
01:15:56 ◼ ► of app review leads to, and this is a put it on the list, fear of app review rejecting your app
01:16:04 ◼ ► and destroying your business leads to a level of timidity in development because everybody's afraid
01:16:11 ◼ ► that Apple's going to kill their product if they try to do something, even if the rules, even if
01:16:16 ◼ ► you went through the process and Apple was like, "Oh, no, this is great. Who's going to put in all
01:16:21 ◼ ► that work and then roll the dice and see if Apple will be convinced that it's a good idea?" So this
01:16:28 ◼ ► was always a case where it felt like it was on the edge of what the App Store rules even would
01:16:34 ◼ ► allow. And yeah, it's so quiet and nobody noticed it and it just wasn't a thing. It's the story of
01:16:40 ◼ ► the App Store, right, which is there's a way to pay, but you have to do it in a web browser.
01:16:44 ◼ ► You can't do it in an app, except for Apple. You can do it in an app for Apple, but nobody else
01:16:48 ◼ ► can do that. So this is also interesting when looking at Spotify. So Spotify just announced
01:16:54 ◼ ► their plans for podcast descriptions as well, and it's all being run through Anchor if you want to
01:17:00 ◼ ► go with them, which is the tool that they're using for this. I believe that it's also working through
01:17:07 ◼ ► a kind of a different tool as well, but for most podcasters, they'll use Anchor. Spotify are taking
01:17:12 ◼ ► no cut at all until 2023, where the cut will be 5%, but you do have to arrange your own Stripe
01:17:20 ◼ ► account so you're going to be paying the card processing fees. So actually, once Spotify's cut
01:17:26 ◼ ► comes in, the difference in money between them and Apple is actually not that much, but the good thing
01:17:32 ◼ ► about Spotify's system is it's the content that you go through with them, it's not locked to
01:17:39 ◼ ► Spotify because it's going through Anchor. They give you an R, like if you subscribe, you get an
01:17:44 ◼ ► RSS feed as well. So it will show up in Spotify once you're subscribed because it's all tied
01:17:48 ◼ ► together, but you can take the RSS feed with that exclusive content that somebody's using through
01:17:57 ◼ ► Now, Spotify are doing the thing, they can't tell you, like it's that frustrating thing again, right?
01:18:04 ◼ ► So you see that there's exclusive content and they kind of say like, this is subscriber only content,
01:18:09 ◼ ► but they don't tell you how to get it. Spotify is telling podcasters, you have to put the links in
01:18:15 ◼ ► the notes yourself so people can go out and get it. But I'm assuming on the back end, once you've paid,
01:18:20 ◼ ► it then just shows up in your Spotify account. Yeah, the magic here of what they're going to do
01:18:25 ◼ ► with Anchor is that first off, unlike Apple Podcasts, which will only work in the Apple
01:18:29 ◼ ► Podcasts app on Apple's platforms, unlike Apple Podcasts, Spotify using Anchor, you can create this
01:18:35 ◼ ► subscription feed. And how is that different from what we do? The answer is because it's Anchor,
01:18:41 ◼ ► Spotify is tied into Anchor and Spotify, when you subscribe to one of those podcasts that's on
01:18:48 ◼ ► Anchor, it will just appear, like you said, in your Spotify app because it has connected you to
01:18:54 ◼ ► that, right? It knows that it's you. You're authorized with Spotify, you've linked your
01:18:58 ◼ ► account. And keep in mind, you can't add an external URL podcast in the Spotify app right now.
01:19:05 ◼ ► That's not a thing you can do. So this is a way that it'll still be listenable inside of Spotify,
01:19:12 ◼ ► where our per user member feed URL thing doesn't work in Spotify right now. Not right now.
01:19:20 ◼ ► But Spotify, I think surprising everybody, have said that they want to also allow for companies
01:19:29 ◼ ► like ours, companies like Jason's, who have their own memberships that are serviced through another
01:19:35 ◼ ► platform or from a platform of their own. They want to try and get this content into Spotify.
01:19:41 ◼ ► They don't want to do the arbitrary RSS adding thing because it doesn't work with the way that
01:19:46 ◼ ► Spotify's infrastructure works. The ins and outs of that are not necessarily important to get into
01:19:53 ◼ ► right now. So they are creating an OAuth based system. So an existing platform would create a
01:19:59 ◼ ► hook that you can then basically use your login information in the Spotify app and then you can
01:20:05 ◼ ► get the content straight into Spotify. I think this is fantastic. And Spotify take nothing and
01:20:10 ◼ ► they're not asking for anything. They just want the content because Spotify, their business now is,
01:20:22 ◼ ► they want to have them as well. And this is a case where this is something that, you know,
01:20:26 ◼ ► Apple's not interested in doing something like this, but this is, yeah, I'm really interested in
01:20:30 ◼ ► this. But Apple still allow the arbitrary RSS feed thing, right? Right. That's true. Whereas
01:20:35 ◼ ► Spotify had built a complete wall and then this is a way to get in where you use OAuth. So assuming
01:20:42 ◼ ► that Memberful, which is our provider of membership services, supported the OAuth system that Spotify
01:20:51 ◼ ► is using to verify somebody is a subscriber, at that point, we would be able to offer membership
01:20:59 ◼ ► podcast content inside of Spotify. Which I'm very excited about. I want to take a quick side note
01:21:05 ◼ ► here now and just say that I don't think Spotify, I think it's pretty clear actually, are not going
01:21:11 ◼ ► to be as bad for the podcast industry as everybody had originally feared. It does seem a little less
01:21:14 ◼ ► absolutist than we were led to believe early on. So they're embracing openness. I love that that's
01:21:21 ◼ ► on both sides because membership content can be listened to anywhere, right? That's more open than
01:21:28 ◼ ► Apple podcast subscriptions are. I feel like that this OAuth system is very creative first in saying
01:21:36 ◼ ► like, "Hey, we don't necessarily want your money, right? We don't want all your money. If you want
01:21:41 ◼ ► to do your own thing, fine. And you can still get to your listeners. You just have to do this little
01:21:45 ◼ ► bit of extra work." It's like, "Okay, fine." And their other thing is, and everyone says, "Oh,
01:21:53 ◼ ► they're just getting ready to do ads and they're going to make their own ad platform and it's going
01:21:56 ◼ ► to kill the industry." I don't think this is true at all in the sense of killing the industry.
01:22:01 ◼ ► They, Spotify are very clearly building a large user base so they can create their own ads
01:22:12 ◼ ► I want to be a part of this program. I want Spotify's ads. So I will now use either Anchor
01:22:17 ◼ ► or Megaphone, which is the two hosting platforms that they use. And then I can get Spotify's ads
01:22:24 ◼ ► put in." But the thing that I just want to mention for this, I think a lot of people forget is
01:22:28 ◼ ► YouTube. YouTube's ads are not the only ads on YouTube videos. And YouTube's ads, creators make
01:22:36 ◼ ► less money because they're not as well made. Most of the high paying, effective ads on YouTube are
01:22:43 ◼ ► the ones that are inside the videos. Our ads are inside of our podcasts. And then they are more
01:22:49 ◼ ► targeted. They are bred by the hosts, which are better. And it requires that if any good hosts
01:22:56 ◼ ► will have done the due diligence and make sure that they're happy with the sponsor or whatever.
01:22:59 ◼ ► So I think that those two things can continue to exist on Spotify. It's the same way that they do
01:23:06 ◼ ► on YouTube. That Spotify can have their ads, but creators can have their ads as well. And whichever
01:23:11 ◼ ► wins, wins, right? So I just think that the cards that Spotify are playing now, they're kind of like
01:23:17 ◼ ► putting it all on the table. And I really just don't think it's as bad as I'd originally feared.
01:23:23 ◼ ► And honestly, they're making decisions I wish Apple would make. Yeah. Other than the fact
01:23:28 ◼ ► that Spotify, I mean, I think the problem was this idea that Spotify structured their podcast stuff
01:23:35 ◼ ► so that you had to submit to them, but also that you couldn't do a custom RSS feed, which was the
01:23:39 ◼ ► only way that we had to do members only content, right? Like that wall that has turned out to be a
01:23:44 ◼ ► little more porous than we maybe thought. And that helps, right? Because Spotify isn't open quite,
01:23:51 ◼ ► but it's like Spotify, it seems now wants to be part of a larger podcast ecosystem instead of,
01:24:03 ◼ ► they opened a window or they opened the door. It's still its own thing, but there are pathways
01:24:10 ◼ ► in and out and there's circulation that's allowed to happen. Whereas it seemed when they first did
01:24:15 ◼ ► this that they're like, we don't get it. We're just going to build podcast stuff into Spotify,
01:24:20 ◼ ► where you submit your podcast and they appear in here and like, we're our own thing. And we're
01:24:24 ◼ ► going to take podcasting and we're going to go home. And with their purchases and some of their
01:24:29 ◼ ► announcements that they made, I don't know whether this was their original intent. I suspect not,
01:24:33 ◼ ► but they seem to be more open to it now. I don't love Spotify, but a lot of people use them.
01:24:40 ◼ ► And their approach seems to have been tempered from what their original approach that was very
01:24:46 ◼ ► much like the world happens inside the Spotify app and nowhere else. I mean, just for me personally,
01:24:52 ◼ ► as a listener, I don't want my music and podcasts inside of the same app. And also the Spotify
01:24:57 ◼ ► podcast listening experience I think is inferior, but some people do. Some people do. And that's,
01:25:03 ◼ ► and that's fine. Right. In the end, this is the biggest problem with Apple's podcast thing,
01:25:08 ◼ ► honestly, is that only works in Apple's app and like, that's fine. Lots of people use Apple's app,
01:25:18 ◼ ► being in having a program that only works in one place is not as good as having a program that
01:25:25 ◼ ► works in all places. Right? Like that is a problem. And so being on the other side of it and being
01:25:31 ◼ ► like, yeah, we're just part of the whole, and you can listen in Spotify too. I want to be there. I
01:25:36 ◼ ► want our, there are probably people who listen to our members only podcasts who mostly listen
01:25:43 ◼ ► to podcasts in Spotify, but have to not for us. Right. Probably not that many. The other thing
01:25:48 ◼ ► is that we have listeners in Spotify that don't become members because they can't get the content.
01:25:55 ◼ ► Right. Same, same point. Yeah, exactly. So sure. I would love for, for our stuff to come to where
01:26:02 ◼ ► they listen. Right. That in the end, that's the goal of somebody who's making content in a medium
01:26:09 ◼ ► or in a, in a something like podcasting. Right. The goal is I want anybody to be able to hear it
01:26:14 ◼ ► wherever they want to hear it. Like I don't want my, I don't get a bonus for the number of people
01:26:20 ◼ ► who listen in Overcast or listen in Apple podcasts. Right. It's like, I don't have a horse
01:26:30 ◼ ► opportunity to listen wherever they feel comfortable because I just want the most people
01:26:34 ◼ ► to be able to listen. And then fundamentally, yes, I want the most people to be able to
01:26:38 ◼ ► become a member and support the show. And so it sounds like Spotify's approach is going to allow
01:26:43 ◼ ► us to do that. And that's great because Apple already lets you do that with their approach.
01:26:49 ◼ ► Apple's subscription thing is a new thing, but you can already listen to our members podcasts in
01:26:54 ◼ ► there. Spotify is the one where you can't. And so I'm encouraged by that. This episode is brought
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01:28:43 ◼ ► show and RealAFM. Let's do some #AskUpgradeQuestions. Dan asks, "If you only had $1600 to spend on new
01:28:53 ◼ ► hardware and had to pick one, would you go with the 24-inch iMac or the 12.9-inch iPad Pro for
01:28:59 ◼ ► Magic Keyboard?" So I like this because it's sort of like a shopping spree. Yeah. Right, you have
01:29:05 ◼ ► you have to buy one. So what would you buy and you can't buy anything else. I'd get the iPad Pro,
01:29:13 ◼ ► because I want a new iPad Pro because I love the 12.9-inch iPad Pro and I've got MacBook Air and
01:29:19 ◼ ► my iMac Pro would not, I don't, the 24-inch iMac isn't the right replacement for it. It
01:29:27 ◼ ► wouldn't actually be faster in a lot of ways than my iMac Pro. So this one's actually pretty easy
01:29:45 ◼ ► For my kind of work setups right now, the iMac would actually be of the most benefit to me. Like,
01:29:52 ◼ ► I don't feel the requirement to change out my iPad right now, but the Mac Mini that I'm recording on
01:30:00 ◼ ► and editing on at the studio right now feels so much slower than my M1 MacBook Pro. So I have an
01:30:06 ◼ ► Intel Mac Mini and when I'm editing in Logic, this thing, it's like just chugging. It's not enjoying
01:30:14 ◼ ► it and things are moving slowly and it's a bit of a mess considering as well. It's upsetting really,
01:30:21 ◼ ► because this is a six-core Intel i7 with 32 gigabytes of RAM and my M1 MacBook Pro with
01:30:31 ◼ ► 16 gigabytes of RAM just runs circles around this iMac, around this Mac Mini. So for me right now,
01:30:38 ◼ ► I would go with that. That's just for my own work preferences right now. I can see for a lot of
01:30:44 ◼ ► people that the iPad would be the right thing to go for. I think it really depends what you do. I
01:30:50 ◼ ► think for most people with that budget, the iPad Pro with Magic Keyboard would be the better option,
01:31:11 ◼ ► Eric asked, "Should Apple add more software power to the iPad Pros and still keep iPadOS the same
01:31:24 ◼ ► I think one iPadOS makes sense, but remember Apple often will roll out features that have
01:31:33 ◼ ► at the developer conference, said, "Here's a new feature, but this requires the M1. This requires,
01:31:42 ◼ ► you know, whatever it is, this much RAM." Now that they're listing RAM, they could do that.
01:31:47 ◼ ► All the iPads can do this, but you can do more of this on this iPad. So like with some of the
01:31:53 ◼ ► multitasking stuff, it was like, you know, you could have two apps side by side, but you can't
01:31:58 ◼ ► do slide over or whatever with some of the older iPads when they first introduced that. It was some
01:32:02 ◼ ► element of that. Yeah, right. So I don't think it would be unreasonable at all. Let's say that
01:32:10 ◼ ► the thing Federico keeps talking about, like Hypervisor framework, like the ability to run
01:32:14 ◼ ► a Linux VM in an iPad, right? I could see Apple just saying M1 only. And right now that's iPad Pro
01:32:27 ◼ ► 2021 only, right? But here's the thing. Eventually the iPad Air will have an M1 in it, right? In two
01:32:36 ◼ ► years. And then eventually after that, maybe the iPad has an M1 in it and the iPad mini has an M1
01:32:44 ◼ ► in it. Maybe. Eventually. That's what I think that they can do. I don't think they're going to
01:32:50 ◼ ► break it apart and say, "Well, now there's iPad Pro OS," and all that. But I think that they will
01:32:55 ◼ ► feel free to release features as they have on the Mac that require specific hardware. And, you know,
01:33:01 ◼ ► below that point, you just don't get it. And that's okay. And that did happen with multitasking,
01:33:07 ◼ ► where originally only like the iPad Air 2 or something had the ability to do multitasking when
01:33:12 ◼ ► the beta came out, because it was the only one capable enough with processor and RAM to do it.
01:33:18 ◼ ► And then by the time the fall rolled around, I think then had some new iPads that better supported
01:33:24 ◼ ► it. I think that was when the iPad Pro came out. So, yeah, that's my answer, Eric, is that I think
01:33:30 ◼ ► Apple will feel free to introduce some features that are, for example, M1 only. And over time,
01:33:37 ◼ ► more devices will support the M1 and therefore get those features. But originally, it might just be
01:33:43 ◼ ► limited to, for example, today's iPad Pros. Matthew, who was the originator, suggestion,
01:33:52 ◼ ► suggestioner, that's a terrible word I just made up, of SnellTalk asks, "Do you think Apple's new
01:33:58 ◼ ► podcast description model will encourage them to improve or develop their software offering for
01:34:02 ◼ ► recording, editing, and publishing podcasts?" No. I don't think so either. I like the idea of this
01:34:09 ◼ ► question. It's like, yeah, will they now offer more tools? So they have offered more tools for
01:34:15 ◼ ► publishing, right? So Apple Podcast Connect, which is a thing that has existed before, now has
01:34:20 ◼ ► additional features that it needs to have for subscriptions to work. But then because of that,
01:34:23 ◼ ► there are some additional things that people can do, whether you like that or not or whatever,
01:34:28 ◼ ► there are now new tools. I don't think that this will push them to do more things, which, I mean,
01:34:35 ◼ ► and the main thing would be to really improve iPadOS. I mean, if you've listened to this show
01:34:40 ◼ ► for more than a couple of years, you would have had to talk about this. Well, I think they could
01:34:44 ◼ ► put podcast-friendly features in Logic, for example. They could do that, or GarageBand,
01:34:49 ◼ ► which they did at one point, and then they took them back out. I could see a scenario where they
01:34:54 ◼ ► would say, "Oh, well, we're adding some features to Logic or GarageBand that will automatically
01:34:59 ◼ ► upload your podcast to the backend of Podcast Connect," or whatever they're calling it.
01:35:03 ◼ ► - Yeah, I mean, I'm not thinking that the features would be tied to subscriptions. Just the idea of
01:35:10 ◼ ► like Apple now kind of taking a bigger hand in podcasting again, would that maybe have them say,
01:35:22 ◼ ► - It's not impossible that what will happen or has happened is somebody... Like, I've been beating on
01:35:30 ◼ ► the drum of Logic and GarageBand being better for podcasters forever, right? And maybe there's a
01:35:35 ◼ ► meeting where they're like, "No, no, no, we're a music tool. No, no, no, we're a music tool." And
01:35:42 ◼ ► And a manager's like, "Oh, yeah, right. Okay." Right? So it's possible, but I wouldn't count on
01:35:50 ◼ ► it. I feel like Apple's sort of like decided... Their tools aren't required for any of this stuff,
01:35:56 ◼ ► it's just podcasts. And it's been so long that they have not been participants in this actively,
01:36:06 ◼ ► had to GarageBand that would make it much more suitable for editing podcasts than it is.
01:36:14 ◼ ► because GarageBand on iOS is not suitable for podcast editing. But there are other tools too,
01:36:19 ◼ ► so I don't know. I don't expect it. It's possible. It's always possible, but I think it's unlikely
01:36:25 ◼ ► that this initiative is suddenly going to transform their software strategy regarding audio software.
01:36:36 ◼ ► Apple TV and HomePod issues? I had four days of being able to use my HomePod pair with my Apple
01:36:43 ◼ ► TV again until this morning when the failures began again. So I updated and I was like,
01:36:50 ◼ ► "Alright, I'm going to try this out. I'm going to give it a go." So I've been looking for the
01:36:55 ◼ ► last lot, best part of this week. I've been using it. It's been great. Love it. And then we were
01:36:59 ◼ ► watching Netflix today. All of this with Netflix was perfectly fine. And then today, every five
01:37:04 ◼ ► minutes, it was pausing. And I have to play again. And then every five minutes, pause again.
01:37:11 ◼ ► I have yet to do the full factory restore of my Apple TV that I said I was going to do. I haven't
01:37:17 ◼ ► done it yet. I'm going to give it a little bit longer with tvOS 14.5. And then I'm going to do
01:37:25 ◼ ► that too. It's just one of those things where I know it's going to be a pain and it's going to be
01:37:29 ◼ ► a bunch of time and I don't want to do it. But I will eventually do it. One thing I don't know,
01:37:46 ◼ ► I think so. Because I know you can do the home screen sharing. I mean, does it also work with
01:37:53 ◼ ► restoring an Apple TV? So I don't know. I'll find out. I think everyone in the discourse is now
01:37:59 ◼ ► telling me it syncs. Now that I know that, I will just do this at some point in the not too
01:38:04 ◼ ► distant future just to see if it improves my experience. Just because I've had a couple of
01:38:08 ◼ ► people who wrote in that were having the same problem with me and they did do this and it fixed
01:38:12 ◼ ► it. Now I've also heard from other people who fixed it in other ways and that didn't work for me.
01:38:16 ◼ ► But maybe this one will. I think that's it for today's episode, Jason Snow. If you would like
01:38:22 ◼ ► to send in a question to help us close out an episode of Upgrade, it could be about anything
01:38:26 ◼ ► you want. Mostly tech focused, so of course send in a tweet with the hashtag #askupgrade or use
01:38:31 ◼ ► question mark #askupgrade in the relay FM members discord, which you can get access to if you
01:38:37 ◼ ► subscribe for the show. We talk a lot about subscriptions this episode. You're like, hey,
01:38:40 ◼ ► what is that subscription thing they keep talking about? They're talking about their own content.
01:38:44 ◼ ► Well, Upgrade Plus is what it is. Go to getupgradeplus.com and you will get longer episodes
01:38:49 ◼ ► of every single release of Upgrade. Even when we do the bonus ones, when we have drafts, you get a
01:38:54 ◼ ► longer episode even. And also every episode has no ads as well. In Upgrade Plus this time, we're
01:39:00 ◼ ► going to talk about Jason's experiences of driving a Tesla for a very, very long journey. So if you
01:39:05 ◼ ► want to hear about that, go to getupgradeplus.com. Thank you to Tax Expander, Fitbod and Hello for
01:39:11 ◼ ► their support of this episode. Thank you for listening. Let me tell you about another show
01:39:16 ◼ ► here on Relay FM called Automators. If you want to learn how to make your devices do more for you,
01:39:21 ◼ ► join David Sparks and Rosemary Orchard. They cover a huge number of programs, apps, and ways that you
01:39:26 ◼ ► can automate things in your life. Find it at relay.fm/automators or search for Automators
01:39:31 ◼ ► wherever you get your podcasts. If you've been thinking, "Hey, all these cool kids are using
01:39:36 ◼ ► their Streamdex these days," they just did an episode about Streamdex so you can find out
01:39:40 ◼ ► why people are using those things and go check it out. If you want to find Jason online,
01:39:44 ◼ ► you can go to sixcolors.com and he is @jsnell on Twitter, J-S-N-E-L-L-L. And I am @imike,