Google and Apple, The Beginning

Are Apple and Google competitors or are they partners?

Prior to the launch of the Android operating system, Apple and Google collaborated on many projects. Google Search was predominant on Apple products including the (at the time) new iPhone. The iPhone also launched with support for Gmail and had native Google Maps and even YouTube. Google was a cornerstone supplier for the new smartphone.

After the launch of Android only a year later, the relationship changed. The two companies came to be viewed as mortal enemies. The perception that Android was disruptive to Apple—insofar as it undercut the pricing power of the new touch-based user experience—was universal. The “zero price” of Android and its licensing by all other phone makers suggested a competitive collapse was imminent for the fledgling iPhone. Android phones were far cheaper and “good enough.” If not immediately, then with the resources of all phone makers and Google itself, Android would surely soon overtake the iPhone in performance along all dimensions. It took a great deal of courage to argue otherwise.

But, over time, the notion that the iPhone would continue to exist became more widely held. Holding on to a “premium” positioning, iPhone seemed to be have pulled a rabbit out of a hat, perhaps because of Steve Jobs’ reality distortion field or because of magical marketing. Nonetheless, doubts over long-term growth persisted.

Having survived Android, Apple was still seen as vulnerable to a multitude of Google initiatives including Chrome and Chromebooks, a range of Google Pixel phones (enabled by the acquisition of Motorola and HTC.) The entry of Google wearables (enabled by the acquisition of Fitbit), Glasses, the Play Store, YouTube content, Google productivity apps, Google cloud, Google TV, Nest, Google Assistant and numerous other services were all cited as nails in the iPhone coffin. This is all before the age of Crypto a new generation of AIs came into fashion.

Throughout this period the iPhone continued to increase its audience, growing its base of users not only from smartphone non-users but also from so-called “switchers”, that is, those who moved from Android to iOS. Apple has benefitted from this net positive switching for at least five years now as most of its addressable market has already adopted the smartphone. There are about 1.2 billion iPhone users and it’s far more likely that a new iPhone user today arrives from the 3.5 billion Android users than from the 3.2 billion people who don’t yet have any smartphone. That is because those who don’t yet have a smartphone today are also likely to not yet have access to electricity, cellular networks or money.

Indeed, it is Android that seems to be in a precarious position. The ecosystem is bleeding not just high-end users but also from fragmentation. Chinese OEMs in particular deliver their own experiences and code bases, eschewing Google services altogether. Large OEMs such as Samsung are seeking to differentiate with their own experiences and ecosystems and accessories and chafe against Google’s hardware offerings. Upgrade rates to new Android versions are poor. Support of hardware beyond a few years is lacking. But, most fundamentally, Google has not developed a business model that directly fuels development of Android.

Put simply, Android is not a profitable product. It’s not designed to create revenues. It’s designed to reduce costs.

To understand this, we have to understand Google’s business. It’s not very complicated. Google’s revenues in the last quarter are segmented as follows:

The colors above indicate the major categories. Blues are Advertising, yellow is “Other” and red is Google Cloud. Other Bets, consisting of research projects, is a 0.4% rounding error. Apart from Search which is about 60%, each major category is about 10%. Advertising as a business model is about 78%.

To Alphabet’s credit, Advertising as a business model has been reduced from 94% a few years ago. Much of that credit goes to Cloud which is a B2B business and has completely different resources, processes and priorities than Search. The “one trick pony” label is less applicable to Google today.

Search however, and the ancillary properties, are still, by far, the largest sources of revenues and profit. Note that Android itself is missing from this mix apart from Play Store which is a direct Android extension. Play does contribute somewhat as part of “Other” but the OS itself is an enabler across all these categories.

While not directly producing revenues, what Android does is perhaps even more important. It helps reduce the amount Google has to pay to access its customers. Think of Search as a system which takes queries in and puts results out. These results are what advertisers pay for and the queries are what Google pays for. The output depends on the input. That input is harvested from many users. Access to those users is not free. The cost can be paid by building access directly (Android) or by paying for access to someone else’s property (Apple, Windows, or Firefox). In old-school business terminology this is called distribution.

Distribution is often ignored or considered a superfluous “middleman” to be bypassed. But distribution is foundational to any business. It is, effectively, other people, outside your company, helping you sell your product because they have access to the customers. They get paid for that access, often with a percent of sales. Stores are distribution. Wholesalers are distribution. Resellers are distribution. Without distribution scale cannot happen. Distributors help both producers and consumers by creating access.

Access is also provided by what we call infrastructure. Just like you can’t travel by car from your house to your destination without roads, all access to products and services is effectively infrastructure. If you own the infrastructure then you have to pay to build it and maintain it. If you don’t own it you have to pay to use it. All infrastructure has value and all infrastructure has costs.

This all makes more sense when recalling the historic birth of Android. At the time (2006 to 2008) the worry for Google was that Microsoft’s mobile operating system (Windows Mobile née Windows CE) would be licensed as was Windows. That is to say that all phone OEMs would take a license for a nominal fee and build Windows Mobile phones. Microsoft would thus dominate the mobile computing market the way it dominated the PC market (with market share above 95%). Microsoft would then ensure that Bing search was the default on all devices running Windows and Windows Mobile, thus blocking access to what was expected to be the next 3 billion users while capturing all search ad dollars ad infinitum.

If Windows Mobile were to dominate, Google would be denied distribution, at any price. It would thus be relegated to, at best, 10% market share of mobile search. This would be an existential crisis.

In this setting, Apple was an ally for Google. Apple was not a search engine provider and was very welcoming of Google search on a nascent Safari browser. Whereas Explorer would block Google search, Safari would offer default placement. Not for free, but for a reasonable cost. Google was a “go-to-market” partner for Apple and it was a symbiotic relationship.

However, the expectation of Google at the time was that Apple would be no more successful with iPhone than it was with the Mac: A fringe of “creative” or “fanboy” quirky oddballs. This was not just Google’s expectation. It was everyone’s expectation.

Android was built to counter a Microsoft mobile OS monopoly with a “zero cost” option vs. Microsoft’s end-user-license model. Microsoft made money selling software. Both system software (Windows) and application software (Office.) Google would give away system software (Android) and services (Gmail and Docs) but make money on advertising.

A genius move. Phone OEMs would much rather pay zero of the OS on their phones than for the non-zero Windows Mobile license. [On a $200 retail cost phone (and thus $90 bill of materials) a $8 OS license is a huge cost.] Google’s Android did indeed block Windows Mobile from getting a foothold in the post-PC era.

But it did so by taking some short cuts. Android itself was an acquisition in 2005 (for $50 million, with a keyboard interface) and, in response to the iPhone, a new touch user interface was developed. It so happened that this interface copied as closely iOS as Windows had copied the original Mac. This perceived theft was such an affront to Steve Jobs that he declared war on Google.

It was important to ask (as few did) why did Google need to develop an OS, only to give it away. Was its business that robust if it needed to expend enormous energy and capital to build an enabler? The answer is, of course, distribution.

Google was initially not paying for distribution as most people just typed “” into their browsers. As the URL field became a search field, Google could still expect PC users to make their search bookmark, one click away.

But on mobile devices, the friction of the constrained interface meant that defaults mattered. Mobile was going to require new distribution economics. Devices were going to be in the hands of many more people, who, since they did not have full-size keyboards, would type less and who would interact in new (and very succinct) ways. One click away was one click too far.

With Android (and Chrome) Google set defaults for its services across the platform. If Android was the OS then Chrome would be the default. If Chrome was the default, then Google Search would be the default. For these Android-sourced queries, Google would not pay for distribution. Or, more precisely, would only pay to build and keep Android. Thus the more Android there was, the cheaper it was to obtain search queries for Google. Google had built its own highways: it owned the infrastructure that connected users to its services. These roads were for Android users. And what about iOS users?

Over a 15 year period the smartphone went from essentially zero to 5 billion users. It became so important to those 5 billion people that they keep it with them every waking moment, use it 100 times for a total of 5 hours each day. That adds up to 182,500,000,000,000 interactions a year and, as a result, it has changed behavior, politics and humanity itself.

Throughout this period, the relationship between Google and Apple changed. From being allies, to mortal enemies to, as we shall see, partners. We have to understand this new relationship that has emerged and its consequences.

The next post will explore the relationship in detail using the lens of the deal structure that exists. A deal which is not public and largely unexamined.

The Apple Investor’s Dilemma

While preparing for the 2023 Apple Investor Event, I looked at my presentations from the last such event. This was called the Apple Summit NYC and took place in August 2018, about 5 years ago.

We will review these graphs at the next event but I would like to post them here to get the conversation started. Keep in mind that the conversation at the time was very much oriented around whether Apple’s growth could continue.

The cash and cash equivalents showing generated cash had just topped $400 billion.

Apple was still providing guidance and their accuracy with those estimates was reviewed. Also, the growth and cyclicality due product launches and major upgrades.

Share price and EPS multiples.

Can you, off the top of your head, visualize these graphs today?

Join us at the Boston event to look back so we can look forward.

9:0010:00Welcome, Coffee, Donuts
10:0011:00Product & Services Review
11:0012:00Valuation Review (State of the Golden Goose)
12:0012:30Lunch (on-site)
12:3013:00Growth Potential (new products, services and business models)
13:0014:00Limitations (Saying No)
14:0015:00Externalities (Audience Participation)
15:0016:00How to Analyze Apple
16:0020:00Networking and Field Trip
Apple Investor Event Program

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Forecast for Apple’s Earnings for Fiscal Fourth Quarter 2023

As we move ahead into the September quarter, I’d like to review our outlook, which includes the types of forward-looking information that Saori referred to at the beginning of the call. We expect our September quarter year-over-year revenue performance to be similar to the June quarter, assuming that the macroeconomic outlook doesn’t worsen from what we are projecting today for the current quarter. Foreign exchange will continue to be a headwind, and we expect a negative year-over-year revenue impact of over 2 percentage points.

We expect iPhone and Services year-over-year performance to accelerate from the June quarter. Also, we expect the revenue for both Mac and iPad to decline by double digits year-over-year due to difficult compares, particularly on the Mac. For both products, we experienced supply disruptions from factory shutdowns in the June quarter a year ago and were able to fulfill significant pent-up demand in the year ago September quarter.

We expect gross margin to be between 44% and 45%. We expect OpEx to be between $13.5 billion and $13.7 billion. We expect OI&E to be around negative $250 million, excluding any potential impact from the mark-to-market of minority investments, and our tax rate to be around 16%.

Luca Maestri, CFO Apple Inc., Aug. 03, 2023

In August Apple reported Net sales growth of -1% and EPS growth of 5.4%. My expectation is a 1% sales growth with EPS growth of 11.4%. This might be slightly optimistic but it’s based on the following assumptions:

  • iPhone unit growth of -1.4% (y/y) but revenue growth of 2% (as per guidance, up from -2% previous quarter’s growth).
  • Mac unit and revenue growth of -12% (this might be optimistic, low confidence)
  • iPad unit growth of -2% but revenue growth of -12%.
  • Services revenue growth of 12% (acceleration from 8% q/q)
  • Wearables 2% revenue growth (consistent q/q, down from 10% y/y)

I estimate the gross margin to remain at 44.5%, open to be $13.5 billion (low-end of guidance), OI&E at -$250 million (per guidance) and tax rate at 16%.

The number of shares I estimated at 15.666 billion (down 109 million, below 126 million average drop for last 8 quarters.)

To summarize, for the fiscal fourth quarter 2023:

  • Total revenue: $91.1 billion
  • EPS: $1.43

Revenue by segment:

  • iPhone: $43.5 billion
  • iPad: $6.2 billion
  • Mac: $10.0 billion
  • Services: $21.5 billion
  • Wearables/Home/Accessories: $9.8 billion
  • Gross margin on total revenue: 44.5%

As can be seen in the following graph, my expectation is that the company will return to a pre-Covid growth trajectory (on a TTM EPS basis) after a transient surge and recovery due to the phenomenon of work-from-home and reduced travel. The uncertainty related to Covid is subsiding but macro and geopolitical uncertainties remain and the company continues to provide limited guidance.

Apple Investor Event 2023 (Location Update)

There are still tickets available for the super-exclusive (max. 25 participants) Apple Investor Event, November 9th.

The location is The Metlo, 21st floor, in Boston’s Seaport district. The address is:

With location is in an area known as the Innovation District, this very new building is walking distance from Boston’s South Station which is a terminus for direct trains from New York City and points south. It’s also walking distance to the World Trade Center stop for the free Silver Line connecting to Boston’s Logan Airport, making it a car-free destination. Local parking garages are available for drivers.

The venue is a media room with intimate access to a very large projection screen.

The agenda has been expanded to include the following topics:

  • Overview of recent performance (product/services)
  • Valuation
  • Growth potential
  • Limits to growth
  • Determinants for share price appreciation/depreciation, i.e. signals to look for in deciding your position relative to your risk appetite.

There will be opportunities for private meetings and after-hours networking. Depending on interest, I’m available to conduct a walking tour of historic Boston Waterfront, one of the most interesting historic sites on the continent.

Don’t leave it too late, register now.

Apple Investor Event 2023

I’m super excited to announce the Apple Investor Event 2023. This will be the third Apple Investor Event I’ve hosted but it’s been a long time since the last one.

The event will take place November 9th, 2023 in Downtown Boston Area (precise location will be announced soon.)

The program is a series of talks with data/visualizations on the following topics:

  • Products: Financial performance and market overview.
  • Services: Understanding synergies with products
  • Valuation: Measuring customer creation and retention
  • Growth: Opportunities in Products, Services and Geographies. Emphasis on new products in Spatial Computing.
  • Limits to growth: Market Saturation, Apple Silicon headroom, GDP growth.
  • Externalities: Competition, macro, China, regulation.

We are planning a very intimate setting. Sign up here. Tickets are extremely limited. Evening events TBA.

Are Share Buybacks a Waste of Money?

Apple has so far returned $761.5 billion to shareholders. 143.3 billion in accumulated dividends and $618.2 billion in share buybacks. These are the gray areas in the graph above. The question that often comes up is: isn’t this capital return program a misallocation? In particular isn’t buying back shares and retiring them a waste of money?

By definition, it cannot be. The mechanism of buying shares and retiring them is a process of returning retained capital to shareholders. The other ways this can be done are through dividends (periodic or one-time) or the sale of the company (liquidation). Ignoring the liquidation option which does not make sense for viable companies, the decision between dividends and buybacks comes down to a tax efficiency question.

The result is, however, roughly the same: retained earnings, which are stored by the company as cash typically (net value for Apple today is $57.2 billion), are an asset balanced by a liability to the shareholder called Total Shareholder Equity (valued today as $60.3 billion.) As such, the retained earnings belong to the shareholders. It’s why they own the company. It’s what their cash share of the value in the company is.

It’s also surplus to the company’s needs. Had the company needed this cash, it would have spent it on building the products and services it sells or operations that maintain or grow the business. Those expenses appear in cost of sales (COS) or cost of goods sold (COGS) or in operating expenses Sales, General and Administrative (SG&A) or Research and Development (R&D). If it’s not spent this way then it drops to the net income line and, crucially, is subject to taxation (about 12% to 15% for Apple). After taxation, once returned, it’s taxed again as either capital gains (in the case of buybacks) or dividend income. These rates vary on the jurisdiction of the owner and the current tax policy.

Note that the spending on R&D includes development of future projects which are not directly related to current products. Engineering of current products is expensed against COGS. R&D for Apple ($29.4 billion in last 12 months) is significant, having grown to 9% of sales, as the graph below shows.

For the company to decide to return capital it really does mean that it has no good ideas on how to spend it given what the company knows it can and cannot do. It’s a judicious decision and one which honors the relationship between owner and manager with fiduciary responsibility to the owner.

Still, doesn’t that mean it’s wasted?

No. Giving it to the shareholder means that the company says “It belongs to you, I don’t know what to do with it on your behalf, so here, you figure out what to do with it.” The shareholder can then make an allocation decision that suits their sense of what is valuable or useful. The return is a deferral of decision to the owner rather than their agent.

To the extent that once returned, the capital is misspent, that is on the spender, not on Apple.

Consider the alternatives. Instead of returning capital, what some managers decide to do is to re-allocate those retained earnings to acquire other companies with the promise of value creation through synergies. However these are often huge wastes of money. The new asset is recorded as “goodwill” on the balance sheet, offsetting the retained shareholder equity. As the synergies fail to materialize, the asset (goodwill) is written off, and shareholder equity decreases accordingly, and so, value evaporates or is transferred to the owners of the acquired company who cash out above market value.

Acquisitions are a process of picking the pocket of shareholders.

The alternative might be to spend heavily on R&D. That is more admirable but the amount involved is enormous and it’s very difficult to find enough people and projects worth pursuing without turning R&D into an academic organization. Remember that with R&D at $7.4 billion per quarter, the company is spending 41 times more than it did in 2006.

And doubling or tripling R&D, even if possible, would impact margins to such an extent that Apple’s profitability would show very poorly indeed. That would collapse share prices and decrease share-based compensation, limiting the possibility of recruiting talented engineers. It would bring quite a lot of negative consequences.

Another exercise to undertake would be to ask what would happen if the mechanism of share buybacks were made illegal. It was not always legal anyway. That is left as an exercise to the reader.

Apple is Doomed, Revisited

Before the iPhone launched in late 2007, Apple was trading consistently at a P/E ratio above 30. Here is a table for the P/E ratio on each Friday’s closing price from May to August, 2007. The iPhone launched on June 29, 2007.

DateP/E Ratio
6/27/0733.6 (2 days before iPhone launch)
Apple’s P/E ratio around the iPhone launch

Apple was not super powerful but it was not doomed either. It was a time when the iPod was dominant and the Mac was still alive. iTunes re-wrote the rules of the music industry and debate was raging whether Apple should be considered a media company. Platforms were not its strength but Steve Jobs showed he was still able to distort reality.

These good times did not last. The first year of the iPhone was a period of minimal contribution from the new category with Apple still largely valued on the basis of the iPod. The predictions of failure for the new communications product, especially given its high price, were legendary. It wasn’t until 2008 that the iPhone began accelerating and making a meaningful contribution to the bottom line.

It was then, in late 2008, that Apple’s valuation broke. The P/E ratio fell from above 30 to nearly 10. The following graph shows the catastrophic 53% share price collapse coupled to the triple digit surge in earnings which led to the P/E ratio tanking.

[The graph shows earnings per share for the trailing 12 months (blue line) and 10x, 15x, 20x, 30x and 40x that value (colored lines). The share price is the black line. The share prices are sampled every Friday. The graph is notably logarithmic. The grey shaded areas are periods of significant contraction. The percent drops/increases during these periods of contraction/expansion are shown in the annotation arrows near the bottom.]

The valuation remained broken for 12 years, between late 2008 and late 2020. This period being, arguably, the most remarkable wealth creation event in history of business. For evidence see the following graph showing the amount of retained earnings returned to shareholders building inexorably toward one trillion dollars. This is not share price appreciation but cash returns. [If you have evidence of a larger wealth-creation event do let me know.]

The creation of $800 billion of shareholder wealth at fire-sale share pricing.

As I explained throughout this period, motivation to dispose of shares which create immense wealth is explained by the fable The Goose That Laid the Golden Eggs but the question some are asking now is whether more wealth can still be created, and if so, can we expect Apple’s valuation to collapse accordingly?

I should note that during the long, dark years of wealth creation, other technology companies such as FaceBook, Amazon and Netflix, Google (so-called FAANG) and Microsoft enjoyed far higher multiples than Apple, sometimes 3x higher. This was not seen as abnormal by analysts because those companies were always assumed to have higher growth potential, with a diverse portfolio of opportunities while Apple’s growth was perpetually in its past, based on one product.

Paradoxically perhaps, since the Covid-19 pandemic Apple shares have enjoyed P/E ratio roughly equivalent to the other tech companies. For instance, peaking at 42 in January 2021, the P/E ratio has averaged about 27.5 since then. Simultaneously, diversified companies such as FaceBook (now Meta) and Netflix collapsed due to serious business model flaws (based on single sources of income) and Google (now Alphabet) and Amazon have slowed growth and are facing anti-trust scrutiny. Having lost any presence in mobile computing Microsoft has become entrenched in enterprise, finding new businesses in cloud and (possibly) generative AI. As a result of these reversals, the contrast between Apple and the mega-cap cohort has become fuzzy.

So back to the question: does it make sense to price Apple in the 30x P/E or should it go back in the gutter at 10 to 20?

I would argue that the big change in perception hasn’t been the surge in earnings during Covid (see graph below). The big change is the realization that Apple is no longer about to go out of business.

How could Apple not be going out of business?

Remember that a P/E ratio in the teens is a clear signal from the market that the company is a questionable “going concern”. This is parlance indicating doubt that the company will continue in its present form..

What has changed since 2020 is that even though there were a multitude of crises—from war to pestilence—the eggs kept coming. Perhaps, perhaps, Apple was not doomed after all. In that time it managed to create 1 billion customers. Perhaps having 1 billion customers was a positive outcome. Perhaps counting iPhones during a single quarter was not the only way to value the company. Perhaps having 1 billion satisfied customers made it viable. Perhaps having 1 billion satisfied and loyal customers returning every year was interesting. Perhaps having 1 billion satisfied wealthy customers meant the end is not around the corner. Perhaps having 2 billion active devices in use was sustainable. Perhaps providing services to 1 billion customers using 2 billion devices delivered through 1 billion subscriptions made some sense. Perhaps having all this data in a linear graph made it predictable?

Perhaps. Though Apple provided updates on these figures regularly, the questions everyone asked were still on unit shipments (which Apple stopped providing.) While Services grew at double digits and 70% margins the questions from analysts on conference calls persist on the iPhone and currency or production “headwinds”. Perceptions take time to change. They are still changing.

Maybe at this point it’s time to agree that Apple’s end will not come through being easily replaced by the competition (first Windows then Android, etc.) but by having access to its markets restricted. Being the only American company to have cracked the China puzzle, it’s surely vulnerable there. And please don’t mention India.

Apple is no longer doomed because it’s too weak. It’s doomed because it’s too strong.

It seems that it’s not too hard to believe the end is still near.

The Poetry of Pricing

iPhone 15 has just been released and, as usual, all the products in the iPhone line-up have received new prices. The following graph shows the current product line-up (US prices before tax) and the historic price points for all the previous versions of iPhones since inception.

It was amusing before the launch to see reports that the iPhone 15 would see a price increase. If I were a betting man I would have bet against it. The reason is that, as the graph shows, pricing changes are regularly made every three years and the last one was in 2021, two years ago. It would be an extraordinary claim to expect a price increase this year.

Also, as you can see, price increases only occur when there is a new “top-of-the-line” model introduced. This new highest spec, usually, but not only, in memory, justifies the new top of the range. For instance, the top of the range in 2015 was the 6S Plus with 128GB of storage. Three years later is was the Xs Max 512GB. Three years later it was 14 Pro Max 1 TB. In nine years the top memory increased by an order of magnitude but the top size also increased as did the number of cameras. Naturally, the price increased by about $650.

Therefore we can predict with some comfort that the next “highest price” point will be $1699 for the iPhone 16 Pro Max 2TB, or equivalent. The possibility exists that the iPhone 16 Pro will also include a leap higher in optics and have more technological tie-ins with Spatial Computing.

But this highest price point is not necessarily the most common price point. Indeed, we can guess that the most common point is visible in our graph above. The density of product choices increases toward the middle of the range. The highest and lowest price points are populated with one product. The middle price points from $800 to $1,100 are populated with\ three products each. Therefore a good guess is that the $900 is likely most popular and that the average selling price is also very near there.

Note that the average sales price (ASP) has not been available from Apple since 2018. At that time the ASP was $790 (holiday quarter of 2017). A gradual increase to $900 over five years is not unreasonable. In fact, it probably should be higher given inflationary pressures. We can only guess.

We have to understand that Apple does not set pricing in response to competitive pressures, commodity pricing, inflation, currency exchange rates or internal sales or margin targets.

Pricing is sacred and is a decision made based on consumer understanding.

The anecdotes of Steve Jobs preferring certain price points because of their poetic value are legendary. 99c for a song sounds right and looks good. The iPod was priced in lovely, alliterative $100 increments. Same logic applies to services.

Pricing is an art and when you see the spectrum above you also see how the increments nudge the decision process. Pricing is a signal. It’s a conversation between seller and buyer containing information that both parties will exchange. On the part of the seller it suggests both the cost of the offering and the value it provides. Buyers are inclined to see if they can stretch to the next higher increment given the increased value proposition. Once their decisions in the collective are tallied, the seller knows well what buyers prefer.

Apple has been having this conversation for decades and it shows.

Brief Comments on the iPhone 15 Event

After the Apple iPhone 15 launch event of September 12, 2023 I was a guest on the Claman Countdown show on FOX Business News (FBN) and here is the video.

In advance of the event I was asked for a few thoughts that might be topics I would like to discuss.

My answer was:

Apple has been pushing hard on imaging in their iPhone evolution. It has also released the Vision Pro that offers so-called Spatial Photos and Video. There is speculation that there will be some linkage at some level with Vision Pro and iPhone imaging. I do wonder if we’ll get hints of possible new optics that can support the Spatial Photography

Remember that Apple hinted at Spatial capabilities with its iPhone Lidar sensor some time ago. Apart from better focus at night, there was little purpose for laser distance measurements in a 2D photo device.

Additional Apple Watch health features are also always interesting. Apple’s efforts in health are hiding in plain sight and point to major value proposition to a large audience that skews older.”

Based on this, I’m rather happy to see the support for Spatial Photos and Videos in iPhone 15 Pro. The surprise on the watch was not a new Health feature per se but the Double Tap interaction mode.

Also of interest to me was the Roadside Assistance via Satellite. This will be a very well received feature and many news stories will be written about it.