We await the Lamborghini SUV.
Source: Asymcar #28
Horace and special guest Ben Bajarin of Creative Strategies discuss the Glance conference. They investigate the job of the Watch and touch on the changing responsibilities amongst the upper ranks at Apple.
Source: The Critical Path #166
Horace and Anders discuss the iPhone analog audio port, the lightning port’s use by Apple Pencil and Apple’s viewpoint on privacy and the environment. Horace rounds the episode out with a definition of disruption.
In my quoting of the “Cook Doctrine” I cited the primary criteria for Apple to enter a new market:
We believe that we need to own and control the primary technologies behind the products we make, and participate only in markets where we can make a significant contribution.
These criteria, often repeated, were certainly in force when Apple chose to enter the watch market. Apple has sought and achieved a significant market share and did so while owning and controlling the primary technologies behind the product.
I now turn to the significant contribution criterion to study the possibility of Apple’s entry into the car industry.
The significance test shifts the speculation from whether Apple would build a car, to how many cars is could build. Making a few cars is easy (see first commandment of The Entrant’s Guide to the Automotive Industry). Making lots of cars is hard and hence significance in the automotive market (as in watches and phones) means achieving some degree of adoption, a higher degree of usage and a very high degree of profitability.
So what does being significant in the car business mean? Does it mean becoming the next Tesla? The next BYD or the next VW? How quickly?
Fortunately, we have something to compare an Apple entry to. Apple has made a “significant” market entry in phones and others have made entries in cars. If we contrast the rate of growth of Tesla, EVs, and Hybrids to the rate of growth of iPhones in their respective US markets, we obtain a test of significance:
The graph shows the percent of sales for the alternative car technologies (and Tesla) vs. the percent of US phone users using iPhones (comScore). Here are the conclusions:Notes:
We consider the landscape that Apple’s purported Titan project will address in a few years time.
Horace discusses the pattern of disruption powered by Moore’s law. We turn to the transportation sector and consider the “reimagining” of the car. We further consider scenarios, from sustaining where the current players grow, to new entrant opportunities.
The conversation diverts a bit into the regulatory and taxation regime, specifically US road funding is largely tied to fuel taxes. We note the odd situation where an entry level car driver pays fuel taxes while a luxury Tesla driver does not.
We speculate on Apple’s possible “meaningful contribution” to transportation and the required product, customer experience, sales channel, price and financing options.
Source: Asymcar #27
Horace and Anders discuss viewing Apple’s business as a recurring revenue model, then touch on the iPad Pro somewhat unsuccessfully and host a very special guest.
Rocky II video
Full episode of the show with video where available. Main segment begins at 39:39
Source: The Critical Path #164
Apple Watch was released April 10th 2015. Eight months later we are holding the first Apple Watch conference. To kick off the discussion, here are my favorite myths about this new product:
The Apple Watch continues to hold the top spot among products that will be hot this holiday season, as predicted by the IBM Trend app.
The Apple Watch scored 100 out of 100 on the “IBM Watson Trend Scale”. According to various surveys, about 100 million people will shop this Thanksgiving weekend in the US. One wonders how many purchases by 100 million shoppers merit a score of 100/100.
My estimate for units shipped has been 20 million in the first calendar year. About 7 million have been sold in the first two quarters. That leaves 13 for the holiday and Q1 (which includes Chinese New Year.) I still like these odds.
To learn more about the reasoning around this estimate and hear additional supporting data, join us at Glance conference.
Horace discusses politics and disruption with Michael Tofias. Is disruption of government possible? Michael pursues the study of American political institutions, elections, Congress, and computational political economy to reveal how disruption might play out within governments.
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