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[apple] The Myth of Apple’s Great Design


Apple has great design is the biggest myth in technology today. The latest victim of this ideology comes in the form a remarkable report on the late Steve Jobs’s final project, still in production: a new, $5 billion Cupertino headquarters for Apple Inc. The building is meant to be “as flawless as a hand-held device,” a process supposedly brought about by “treating the construction of the vast complex the same way they approach the design of pocket-sized electronics.”

The only problem with this conclusion: Apple has never accomplished sufficiently great design in its electronics to justify lionizing the pedantry of design at the new Apple campus.

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Notable Design Flaws

If Apple designs at its best when attending closely to details like those revealed in the construction of its spaceship headquarters, then presumably the details of its products would stand out as worthy precedents. Yet, in truth, Apple’s products hide a shambles of bad design under the perfection of sleek exteriors.

MacBook Pro:

The new model ships only with USB-C ports, but all of Apple’s current devices, including the iPhone 7 and a rechargeable Bluetooth keyboard and mouse come with USB-A cables, which cannot connect to the new laptop.


Touch ID, which allows users to authenticate to unlock the phone, download products from the App Store, and make payments at participating retailers with Apple Pay. But even the slightest disturbance on a finger makes Touch ID unreliable.

Auto correct as funny as it once was to guffaw over its foibles, the feature hasn’t become smarter. Users have become more acclimated to managing its errors when writing; how much typing has become retyping, correcting corrections?

The larger 4.7-inch screens made reaching the edges of the screen with one palm difficult, even for users with large hands. Apple’s solution, dubbed Reachability, was an awkward one: double-tapping the home button would lurch the whole screen down for easier address.


The iPod made listening to a whole music library easy, but iTunes always made managing that library difficult and confusing—even destructive.


frequently stops working; on the iPhone, it successfully sends less reliably than text messages once did, particularly when reception is poor.


Keynote, Apple’s PowerPoint alternative, randomly changes the formatting of text in presentation notes—a charming surprise to discover during an actual keynote. iWork, the Apple office app suite of which Keynote is a part, never came close to competing with Microsoft and Google’s commensurate products.

But Why?

Some Apple fanatics will blame these more recent misfortunes of design on the vacuum created by Steve Jobs’s death. But this explanation isn’t sufficient. After all, Apple’s design chief Jony Ive, has remained in charge of the company’s design efforts.

Furthermore, Steve Jobs’s design philosophy was fascist more than it was exacting. The man was a not a demigod of design, but its dictator. He made things get made the way he wanted them made, and his users appreciated his definitiveness and lack of compromise. They mistook those conceits for virtues in the objects themselves and enjoyed it. At a time when every company bows to even the most absurd demands of the consumer, Apple never cared what its customers thought, or wanted. Instead it told them what to like, and how to like it.

In the process, Apple standardized excellence in design at the surface level, while failing to achieve that distinction holistically. Apple’s products are beautiful objects, no doubt. But beautiful objects whose operation never matched their appearance. Beautiful objects that lied about the depths of that beauty.

My 2 cents:

Hating on the leader is alive and well apparently. It is no small irony that the captains of hating on the Microsoft empire now get a taste of their own medicine as overwhelming success breads constant and intense scrutiny. “You either die a hero or live to become a villain” said Harvey Dent in Batman: The Dark Knight.

However, behind the fad lies truth: Apple’s losing its touch, whatever its touch is or was. Some, myself included, had chalked off early market criticism of Apple as a result of inflated expectations: under Jobs, Apple flew too close to the sun and spoiled its investors. Some thought that the market was simply not ready for the first trillion dollar company.

But the repeating underwhelming sales, unimaginative product development (ie. absence of the “next iPhone”) and persistence of the aforementioned extensive, and by no means exhaustive, list of Apple product bugs challenges one of Apple’s fundamental tenants: impecable design from a user perspective.

On one hand, Apple’s problems are very much subject to the self-fulfilling prophecies heaped on by speculators: you keep hearing you have fundamental flaws and you start acting like you do. But, absent speculation, Apple’s back-end and software flaws are finally surfacing in an age where customers aren’t as easy to bully around. The answer to the natural question “why doesn’t Apple care as deeply about its metaphorical back-end as it does about its front-end” might prove more complicated.

My take? A history of isolation and product design “dictatorship” has backed Apple into a corner. We now see a relative commoditization of hardware (ie. Xiaomi can produce an acceptable copy of the iPhone)and a customer shift to software preferences. Developer incentives is Apple’s Achilles Heel vs. open source rivals Android so much so that incentives to develop for Apple has been contingent on Apple’s hardware success.

Apple’s perfect exterior is finally succumbing to its flawed interior.

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[apple] Life and Death in the App Store


Last month, Apple announced it had paid $40 billion to developers since the App Store opened, saying the store was responsible for “creating and supporting” 1.9 million US jobs. More than half a million iOS developers have created apps; the company’s Worldwide Developer Conference is so popular that tickets have to be distributed via a lottery. “[Apple] made our company,” Sykora says. “If Apple didn’t exist, we wouldn’t have a company at all.” And the market for apps is growing: between iOS, Android, and smaller platforms, apps could generate $101 billion annually by 2020, according to market research firm App Annie.

But the App Store’s middle class is small and shrinking. And the easy money is gone.

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For all but a few developers, the App Store itself now resembles a lottery: for every breakout hit like Candy Crush, hundreds or even thousands of apps languish in obscurity. Certain segments of the app economy remain vibrant — ludicrously profitable, even. Apps for massive social networks, on-demand services like Uber, and subscription businesses like Netflix and Spotify remain in high demand. Then there’s gaming: Last year, 85 percent of all app revenues went to games, according to App Annie.

But for a large swath of these app developers — particularly those without venture capital and sophisticated marketing tactics — the original App Store model of selling apps for a buck or two looks antiquated. In 2011, 63 percent of apps were paid downloads, selling for an average of $3.64 apiece. By last year, a mere 27 percent of downloads were paid, and the average price had fallen to $1.27. Today, profiting from the App Store most often requires a mix of in-app purchases, subscriptions, and advertising.

Meanwhile, a fatigue is setting in among customers. There are now more than 1.5 million apps in the App Store (Android users have 1.6 million to choose from), but by 2014, the majority of Americans were downloading zero apps per month. And it turns out people simply don’t use most of the apps they do download. According to ComScore, the average person spends 80 percent of their time on mobile devices using only three apps.

My 2 cents:

The economic dynamics of the App Store and its competition is an ironic black box. The data is there, but economics pundits are yet to delve into the micro economic microcosm that are app sales. App developers are hitting a very tangible wall where catering to consumers existing desires are taking over the idea of wowing consumers by delivering functionalities they hadn’t imagined yet. App purchases are also facing a change in priorities when it come to revenue; a mix of in app purchases, developers are in dire times, relying on activation mixes and vying for a blockbuster position lest your app become a zombie app.

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[apple] A Message to Our Customers


The United States government has demanded that Apple take an unprecedented step which threatens the security of our customers. We oppose this order, which has implications far beyond the legal case at hand.

This moment calls for public discussion, and we want our customers and people around the country to understand what is at stake.

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“The Need for Encryption
Smartphones, led by iPhone, have become an essential part of our lives. People use them to store an incredible amount of personal information, from our private conversations to our photos, our music, our notes, our calendars and contacts, our financial information and health data, even where we have been and where we are going.

All that information needs to be protected from hackers and criminals who want to access it, steal it, and use it without our knowledge or permission. Customers expect Apple and other technology companies to do everything in our power to protect their personal information, and at Apple we are deeply committed to safeguarding their data.

Compromising the security of our personal information can ultimately put our personal safety at risk. That is why encryption has become so important to all of us.

For many years, we have used encryption to protect our customers’ personal data because we believe it’s the only way to keep their information safe. We have even put that data out of our own reach, because we believe the contents of your iPhone are none of our business.

The San Bernardino Case
We were shocked and outraged by the deadly act of terrorism in San Bernardino last December. We mourn the loss of life and want justice for all those whose lives were affected. The FBI asked us for help in the days following the attack, and we have worked hard to support the government’s efforts to solve this horrible crime. We have no sympathy for terrorists.

When the FBI has requested data that’s in our possession, we have provided it. Apple complies with valid subpoenas and search warrants, as we have in the San Bernardino case. We have also made Apple engineers available to advise the FBI, and we’ve offered our best ideas on a number of investigative options at their disposal.

We have great respect for the professionals at the FBI, and we believe their intentions are good. Up to this point, we have done everything that is both within our power and within the law to help them. But now the U.S. government has asked us for something we simply do not have, and something we consider too dangerous to create. They have asked us to build a backdoor to the iPhone.

Specifically, the FBI wants us to make a new version of the iPhone operating system, circumventing several important security features, and install it on an iPhone recovered during the investigation. In the wrong hands, this software — which does not exist today — would have the potential to unlock any iPhone in someone’s physical possession.

The FBI may use different words to describe this tool, but make no mistake: Building a version of iOS that bypasses security in this way would undeniably create a backdoor. And while the government may argue that its use would be limited to this case, there is no way to guarantee such control.

The Threat to Data Security
Some would argue that building a backdoor for just one iPhone is a simple, clean-cut solution. But it ignores both the basics of digital security and the significance of what the government is demanding in this case.

In today’s digital world, the “key” to an encrypted system is a piece of information that unlocks the data, and it is only as secure as the protections around it. Once the information is known, or a way to bypass the code is revealed, the encryption can be defeated by anyone with that knowledge.

The government suggests this tool could only be used once, on one phone. But that’s simply not true. Once created, the technique could be used over and over again, on any number of devices. In the physical world, it would be the equivalent of a master key, capable of opening hundreds of millions of locks — from restaurants and banks to stores and homes. No reasonable person would find that acceptable.

The government is asking Apple to hack our own users and undermine decades of security advancements that protect our customers — including tens of millions of American citizens — from sophisticated hackers and cybercriminals. The same engineers who built strong encryption into the iPhone to protect our users would, ironically, be ordered to weaken those protections and make our users less safe.

We can find no precedent for an American company being forced to expose its customers to a greater risk of attack. For years, cryptologists and national security experts have been warning against weakening encryption. Doing so would hurt only the well-meaning and law-abiding citizens who rely on companies like Apple to protect their data. Criminals and bad actors will still encrypt, using tools that are readily available to them.

A Dangerous Precedent
Rather than asking for legislative action through Congress, the FBI is proposing an unprecedented use of the All Writs Act of 1789 to justify an expansion of its authority.

The government would have us remove security features and add new capabilities to the operating system, allowing a passcode to be input electronically. This would make it easier to unlock an iPhone by “brute force,” trying thousands or millions of combinations with the speed of a modern computer.

The implications of the government’s demands are chilling. If the government can use the All Writs Act to make it easier to unlock your iPhone, it would have the power to reach into anyone’s device to capture their data. The government could extend this breach of privacy and demand that Apple build surveillance software to intercept your messages, access your health records or financial data, track your location, or even access your phone’s microphone or camera without your knowledge.

Opposing this order is not something we take lightly. We feel we must speak up in the face of what we see as an overreach by the U.S. government.

We are challenging the FBI’s demands with the deepest respect for American democracy and a love of our country. We believe it would be in the best interest of everyone to step back and consider the implications.

While we believe the FBI’s intentions are good, it would be wrong for the government to force us to build a backdoor into our products. And ultimately, we fear that this demand would undermine the very freedoms and liberty our government is meant to protect.”

– Tim Cook

My 2 cents:

Way to go Apple for standing up for customer privacy yet again! That being said, this is probably the first round of a long battle for privileged information in the name of the greater good. One could make the argument that data privacy walks a fine line between being one of the most prized possessions in the tech space and being at risk of being thoroughly commoditized if infringements lead to mainstream access. Apple just put its foot down, in the interest of the customer and in its own interest, lets see how other players will follow up.

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[apple] Apple is suddenly trying to hire a bunch of new people for its stores


Apple is suddenly trying to fill a lot of open positions at its stores.
Apple posted 15 job listings for U.S. Apple Stores in the past week. That may not seem like many, but there are certainly more than 15 openings, as the listings are not location-specific — each one is for “various” locations and does not specify a number of spots being filled.

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Apple says that there’s no problem keeping retail employees. Apple’s retail operation posted a 81% employee retention rate in 2015:

“We just ended the year with the highest retention rates we’ve ever had: 81%. And the feedback is that it’s because they feel connected… I don’t see them as retail employees. I see them as executives in the company who are touching the customers with the products that Jony and the team took years to build.” – Angela Ahrendts

Ahrendts has more closely integrated Apple’s online and physical retail operations, and has angled Apple’s stores more as a place for users to become familiar with Apple products and the brand than merely a place to buy iPhones. For example, when the Apple Watch first launched, customers could not buy one from the store, although they could book an appointment to try one on.

My 2 cents:

And this isn’t just a US and China trend, Apple Retail is hiring intensely and globally, a clear indicator of how Apple is planning on recovering prestige and results. Angela Ahrendts will be under heavy public scrutiny in 2016 as Apple Retail leads the sales charge Apple needs. On one hand, more stores, on the other, creating a symbiotic online and bricks-and-mortar experience; Ahrendts’ message is clear: Apple will leverage its most unique assets to achieve results that have been recently lacking, its sales force and channels.

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[apple] Apple Wants to be a Services Company


The iPhone is out of growth, so Apple wants to be seen as a services company like Amazon, Facebook, or Google. For Apple, services include things like app sales, iCloud revenue, Apple Pay, Apple Music, and iTunes.

This is a wonderful idea, but there’s a problem: Apple’s services revenue is tied to the strength of its iPhone business, which is projected to drop this year.

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Why is the iPhone falling? Because the global economy is shaky. Major markets, including Brazil, Russia, Japan, Canada, Southeast Asia, Australia, Turkey, and the eurozone, have been impacted by slowing economic growth, falling commodity prices, and weakening currencies.

So, Apple is in this weird cycle: It wants to grow services revenue, but services revenue depends on iPhone sales. Currencies are falling because the global economy is weak relative to the US economy, which is leading Apple to raise prices on the iPhone, which is hurting iPhone sales, which will limit services revenues.

Cook said people should be looking at Apple as a services business:

“We started breaking out services, as you know, in the beginning of fiscal year 2015. And as that business has grown and as it became clear to us that the investors wanted — investors and analysts wanted — more visibility into that business. The size and growth of these services tied to our installed base compare favorably to other services companies you’re familiar with.”

Of course, it isn’t that simple. Apple can wish people valued it a certain way. Wishing won’t make it so.

My 2 cents:

If Apple truly were a services company, it would lower iPhone prices, go for smartphone unit volume, then get more money from that. But it is not a services company and these service segments Apple are so far down the learning curve that they are border-line commoditized: cloud storage, e payments, and I’m sure music is on the hit list for products that the internet commoditizes for end users.

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[apple] Apple TV – The Future of TV is Apps



 My 2 cents: 

Another dimension to the Apple stock freak-out is the good old expectations-reality gap that people keep attributing to millennials. While the “next iPhone” doesn’t present itself (and while the current iPhone sales has Wall Street skeptical) Apple has pushed the envelope in potential “next iPhone” markets: wearables and now television. It’s not like Apple TV is new, but as we can see, Apple TV is about to get Apped Up. If you consider the rise of chord-cutting, casting, and the over all rise of media streaming, people are going back to their beloved TVs for the most complete entertainment package to date. TV-land is full of competition and substitutes, but no one has cracked the universal entertainment platform code yet, and it looks like Apple is committed.

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[apple] Apple Watch Scooped Up Over Half The Smartwatch Market In 2015


Despite a late arrival to the wearables market, Apple claimed the top spot in terms of device sales, according to new research from Juniper out this week, which stated that the Apple Watch accounted for over 50 percent of smartwatch sales in 2015.

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Android Wear earned less than 10 percent of sales in 2015, the report said, even though the software now powers watches made by a number of companies, including Huawei, Motorola, Sony, ASUS, LG, Fossil, and others.

Meanwhile, Samsung’s Tizen-based Gear S2 didn’t achieve strong sales since its November launch, despite being well received, the report also said.

Apple’s presence in the smartwatch market is also making it harder on its rivals to compete, as evidenced this week by Fitbit’s crashing stock, indicating investors’ lack of confidence in the device manufacturer’s ability to take on Apple on the high-end, as well as other established smartwatch makers further down the spectrum, such as Pebble.

However, just because Apple is running away with the lead thanks to its 52 percent market share, that doesn’t mean the smartwatch market itself is anywhere near established, Juniper also warned in its report.

“The smartwatch is now a category waiting for a market,” wrote Juniper research analyst James Moar. “Newer devices have offered more polished looks and subtly different functions, but no large changes in device capabilities or usage. With smartwatch functions established, it is now up to consumers to decide if they want them, rather than technology companies providing more reasons.”

In other words, the future of the market is in the hands of consumers – who may or may not feel the need for wrist-worn technology to invade their lives.

My 2 cents: 

Much of the nay-saying that has been surrounding Apple this 1st quarter can be traced to inevitable(?) comparisons between the Apple Watch and iPhone in that the market is itching to have Apple move away from what is seen as an iPhone dependent state. The Apple Watch is no iPhone, nor is it perfect and undeniably a better product than competition has to offer BUT it still is the market leader! This just goes to show that Apple’s watch game is a long term game and that power to Cook for having Apple plunge into what was previously a promising but hazy industry and creating market demand (and then promptly seizing 50% of that demand with its pilot product).

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[apple] Why Apple’s Investors Are Questioning its Future


Early this year, Apple fans forecast that the iPhone-maker would become the world’s first trillion-dollar company. Today, that monumental goal is far from reach, and getting more remote with each passing week.

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So why are investors down on Apple? Its price-to-earnings ratio now stands at a meager 11, far below the S&P average. That means that investors are not just skeptical that Apple will be able to repeat its stellar performance in 2015. The market is actually predicting falling profits for the tech giant.

The skepticism can be summarized as follows: the world worries that Apple will never find another iPhone; that single product accounted for 66% of total sales, and for the entire increase in revenues; sales from all its other products combined actually declined.

For an analyst from another planet reading its financial statements, Apple would look like a giant bank or asset manager. Its balance sheet holds $206 billion in cash and securities, or around 71% of its total assets. Apple makes just 1.4% on those holdings. Eventually, it will need to find a way to invest a big chunk of that cash.

The bottom line: Tech’s superstar is entering a world of low expectations, when it’s regularly beaten high expectations. It should be able to vault over the new, low bar with ease, and raise its stock price in the process. Investors, though, believe we’ll never see the likes of a new iPhone—or the Old Apple. But the current Apple may be more than enough.

My 2 cents:

Fact of the matter is, much of this speculation is based on three sources: (1) trillion dollar hesitancy, (2) iPhone expectations and (3) supplier leaks. Apple’s dip can be reversed if one considers that (1) an aspiring first trillion dollar company is under the most intense scrutiny (2) iWatch’s release closely parallels iPad’s release: impressive but not iPhone level… is that so bad? (3) supplier forecast sales that have been leaked don’t relate specifically to Apple’s demand; therefore lower sales from suppliers does not mean lower Apple sales forecast. Does Apple need another iPhone to keep being iPhone? It’s tough to be the innovative leader, and speculation doesn’t help, but Apple has performed above predictions like clock work and iPhone dependency seems to be a concern that Apple doesn’t share.

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[apple] Apple is rumored to be making a smaller iPhone. Is it good to give the people what they want?

**Currently tech-trekking with my fellow Kellogg MBA’s through Seattle, Bay Area, Silicon Valley for the following week, posts will reflect our awesome schedule!**

Monday: Starbucks, Microsoft, Amazon
Tuesday: Salesforce, Twilio, Linkedin
Wednesday: Intuit, Facebook, VMware
Thursday: Google, Medallia, Adobe

Friday: Apple, Cisco, PayPal

Apple is rumored to be releasing a new, smaller-screened iPhone — the 6c, which is particularly intriguing because releasing the 4-inch phone fits into a sort of trend from Apple that’s emerged over the past few years: The company appears to be listening more closely to its customers.
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Likely, the answer is because there are vocal Apple customers out there who don’t want a phone with a screen more than 4 inches. These are people who don’t care much about visual media and who want phones that fit in their pockets. And there may also be more practical reasons. With Morgan Stanley predicting that Apple could see its first smartphone sale slide it may make some sense to appeal to that segment of the market even if it’s not the hot one to pursue.
Steve Jobs’ 2 cents…
“I have my own theory about why decline happens at companies: They make some great products, but then the sales and marketing people take over the company, because they are the ones who can juice up profits.
When the sales guys run the company, the product guys don’t matter so much, and a lot of them just turn off. It happened at Apple when [former CEO John] Sculley came in, which was my fault, and it happened when [former CEO Steve] Ballmer took over at Microsoft.”
That’s not to say that going back to a smaller screen is going to be the end of the world for Apple. It could be a great hit. But what Apple has to balance, perhaps more than any other company, is its desire for mass-market appeal and its reputation for carefully-curated quality.

My 2 cents:

On one hand, Apple and the rest of the high-tech horsemen of the apocalypse (Amazon, Google, Facebook) have made huge forays, investments and statements that point towards video as the new-old hot property. A larger phone/screen meets that logic, but just stop and think about just how small the iPhone 4 was! I saw an iPhone 5 theses days (much longer than the 4, mind you) and it looked puny, and so practical! Not all clients are screen-affictionatos and those who are will get their kicks through the regular iPhone 6, 6+, 6s etc. I see Apple delivering form and function through the 6c, not a sales ploy; there is nothing wrong with launching a product spin-off to target variations of the core segment.
And personally, I miss when my phone fitting in my pocket, don’t you?

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