Apple could be looking for its next big revenue model

Apple has always been an evolving company. While it never really invented any product categories, it always seemed to make those product categories work better and smarter. It also found a way to make us want them, even when they were more expensive. Today, the WSJ reports, it’s trying to find its way to a future without the iPhone at the center of its revenue model.

This shift happens as Apple reported lower revenue for the first time in years against a backdrop of flagging iPhone demand. Part of the problem is a shifting Chinese market, but it’s also due to people simply taking longer to refresh their phones. As that happens, and the price of iPhones soared over $1000, there has been a decline in sales.

With iPhone sales down 15 percent, this was not a typical Apple earnings report, but it was something that company had anticipated when it announced lower Q1 guidance at the beginning of the year. If the Wall Street Journal story is accurate, Apple is already trying to take steps to move the company into its next phase, possibly as a services business.

If that’s the case, it would mark a radical departure from the company’s history in which it has redesigned various types of hardware, bucking popular design trends along the way. Back in the 1970s and 1980s when it was called Apple Computer, Steve Jobs and Steve Wozniak made computers with a GUI when most people were working from DOS prompt.

In the early 2000s, Apple came out with an MP3 player called the iPod and opened a music store called iTunes. By 2006, the year before it would introduce the iPhone, Apple had sold over 42 million units and 850 million songs. It was a combination of hardware and services that helped transform a flagging company into a powerhouse.

In 2007 when Apple introduced the iPhone, it knew that it would begin to eat into iPod sales, and it eventually did, but it didn’t matter because it was the next logical step forward. When it introduced the App Store in 2008, the iPhone became more than a stand-alone piece of hardware. It was a new kind of hardware-service model and it would generate incredible wealth for the company.

The iPad came along in 2009 and the Apple Watch five years later in 2014. While each has done reasonably well, nothing has touched the success of the iPhone. Keep in mind that analysts estimated that Apple sold 71 million iPhones last quarter, and this was in a quarter in which sales declined. It’s hard to sell 71 million units of anything in a three month period and have it be a down quarter.

What comes next is probably some combination of entertainment/content and making use of advancing technologies like AR/VR, driverless cars and artificial intelligence. It’s unclear what direction Apple will take in these areas, but we do know that recent hires and acquisitions point in these directions.

There has long been speculation that Apple could make a splashy acquisition in the content area. When Eddie Cue, Apple senior vice president of Internet software and services was interviewed by CNN’s Dylan Buyers at South by Southwest last year, Buyers specifically asked Cue about buying a property like Netflix or Disney. He implied that it was about taking the Apple TV and combining that with a big-name content production company.

Cue indicated that the two companies were great partners for Apple TV, but he wasn’t ready to commit to anything along those lines. “Generally, in the history of Apple, we haven’t made huge acquisitions.” He went onto explain from Apple’s perspective, it wants to figure out where the future is and to build something to get it there, rather than buying something that is working for the current state of affairs.

It’s worth noting that Apple TV has not matched the huge success of its other devices, but service revenue has been growing steadily. In the most recent earnings report, Apple reported services revenue of $10.9 billion, up 19 percent year over year. That’s still a small percentage of the overall $84.3 billion the company reported for the quarter, but it is growing.

Regardless, nobody can know if Apple can approach the success with any product that it has had with the iPhone. But it knows that in spite of its vast riches, it’s dangerous for any company to rest on its past success. So it looks ahead and hires new blood and looks for a future with less dependence on the iPhone because it knows, as the Grateful Dead once sang, “You can’t go back and you can’t stand still. If the thunder won’t get you, then the lightning will.” Apple is hoping to avoid that fate, and perhaps it is some new combination of hardware, content and services that could lead the way.

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Daily Crunch: Stop repeating this privacy lie

The Daily Crunch is TechCrunch’s roundup of our biggest and most important stories. If you’d like to get this delivered to your inbox every day at around 9am Pacific, you can subscribe here.

1. Stop saying, ‘We take your privacy and security seriously’

Zack Whittaker says that in his years covering cybersecurity, there’s one variation of the same lie that floats above the rest: “We take your privacy and security seriously.”

The truth is, most companies don’t care about the privacy or security of your data. They care about having to explain to their customers that their data was stolen. And when they use this line, it shows that they don’t know what to do next.

2. SeaBubbles shows off its ‘flying’ all-electric boat in Miami

We were promised flying cars but, as it turns out, “flying” boats were easier to build. And by “flying,” I mean “raising the hull of the boat out of the water with foils.”

3. Australia’s government and political parties hit by cyberattack from ‘sophisticated state actor’

PM Scott Morrison said the computer network of the country’s parliament, and those belonging to Liberal, Labor and Nationals parties, were targeted by an attack that took place a few weeks ago, according to The Sydney Morning Herald. Australia is months away from federal elections.

Jeff Bezos - WIRED25 Summit: WIRED Celebrates 25th Anniversary With Tech Icons Of The Past & Future

SAN FRANCISCO, CA – OCTOBER 15: Jeff Bezos attends WIRED25 Summit: WIRED Celebrates 25th Anniversary With Tech Icons Of The Past & Future on October 15, 2018 in San Francisco, California.

4. What business leaders can learn from Jeff Bezos’ leaked texts

Wickr’s Joel Wallenstrom makes the case that when corporate executives take a laissez-faire approach to digital privacy, their employees and organizations will follow suit.

5. China tells teachers to quit assigning homework through WeChat

The regional call to action follows a set of national guidelines released by the Ministry of Education in October directing teachers and schools to take more responsibilities rather than shift the load onto parents.

6. Razer is closing its game store after less than a year

The Razer Game Store launched worldwide in April 2018 with the aim of taking a slice of a business dominated by Steam. The company didn’t comment on why the store is closing, but you’d imagine that it didn’t go as well as Razer had hoped.

7. Monday podcast roundup

This week, Equity discusses Peloton’s plans for an IPO, while Original Content reviews “Russian Doll” and interviews the filmmakers behind “The Breaker Upperers.”

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Netflix cancels ‘Jessica Jones’ and ‘The Punisher,’ its last Marvel shows

Netflix is no longer in the Marvel superhero business, with the cancellation of “Jessica Jones” and “The Punisher.”

The writing has been on the wall since last fall, when the streaming service canceled its other three Marvel shows — “Iron Fist,” “Luke Cage” and “Daredevil.” Plus, showrunner Melissa Rosenberg was already announced to leave “Jessica Jones” after the upcoming third season.

There have been conflicting reports about which company ultimately decided to pull the plug, but this does seem to be part of a broader corporate rift, with Disney ending its broader deal with Netflix and producing Marvel shows for its yet-to-launch streaming service.

Disney has also announced a slate of animated Marvel series on Hulu (where Disney will become the majority shareholder, post-Fox acquisition), following a similar structure to the Netflix shows — four separate series followed by a big crossover.

Neflix, meanwhile, just released the first season of “The Umbrella Academy,” an offbeat superhero series based on the comics by Gerard Way and Gabriel Bá.

In a statement, Netflix said:

Marvel’s The Punisher will not return for a third season on Netflix. Showrunner Steve Lightfoot, the terrific crew, and exceptional cast including star Jon Bernthal, delivered an acclaimed and compelling series for fans, and we are proud to showcase their work on Netflix for years to come.
In addition, in reviewing our Marvel programming, we have decided that the upcoming third season will also be the final season for Marvel’s Jessica Jones . We are grateful to showrunner Melissa Rosenberg, star Krysten Ritter and the entire cast and crew, for three incredible seasons of this groundbreaking series, which was recognized by the Peabody Awards among many others. We are grateful to Marvel for five years of our fruitful partnership and thank the passionate fans who have followed these series from the beginning.

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Amazon aims to make half of its shipments carbon neutral by 2030

Perhaps hoping to distract from Greenpeace’s latest report on its “dirty cloud, Amazon this morning announced a new environmental commitment, focused on reducing its carbon footprint. The company says it aims to reach 50 percent of all Amazon shipments with net zero carbon by 2030.

The company is calling this program “Shipment Zero.” Details on this long-term project weren’t yet available, but Amazon says it plans to share its company-wide carbon footprint “along with related goals and programs,” at a later date. That seems to indicate Amazon will offer an update on the progress of its other sustainability goals, as well.

It’s important for Amazon to be transparent on these plans, as the size of its business means its impact to the environment, energy consumption, and ultimately climate change, is significant.

The company today runs programs including Frustration Free Packaging and Ship in Own Container, and has a network of solar and wind farms, solar on its fulfillment center rooftopsinvestments in the circular economy, the company noted in the announcement. It said it employs over 200 scientists, engineers, and product designers who are dedicated to developing new ways to leverage Amazon’s scale for the “good of the customers and the planet.”

For example, Amazon has been able to pressure suppliers to reduce their environmental impact, with the frustration-free packaging and ship in own container programs.

But Amazon doesn’t have the cleanest environmental record, according to Greenpeace.

The organization dinged the internet giant only days ago for failing to deliver on its commitment to shifting to renewable energy. Its new report said Amazon’s data centers in Virginia are powered by only 12 percent renewable energy, compared with Facebook’s 37 percent and Microsoft’s 34 percent.

In between the lines of this morning’s news, Amazon briefly addressed the Greenpeace report.

“Amazon has a long-term goal to power our global infrastructure using 100 percent renewable energy, and we are making solid progress,” its corporate blog post read.

Amazon did, however, offer a longer statement to Windpower Engineering shortly after the report’s publication, claiming Greenpeace’s data was inaccurate. In particular, it pointed out that the report had failed to highlight AWS and Amazon’s investment in solar projects in Virginia.

Amazon says it will offer more details on Shipment Zero and its other programs later this year.

 

 

 

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Apple could release a 16-inch MacBook Pro and a a 31-inch 6K display

Apple analyst Ming-Chi Kuo is quite reliable when it comes to Apple’s roadmap. And he shared a ton of information over the weekend in a new report obtained by 9to5mac. In 2019, you can expect a bigger MacBook Pro, a new display and upgrades to iPhones, iPads and AirPods.

Let’s start with the Mac. According to Kuo, Apple has been working on a MacBook Pro with an all-new design. It’s unclear if those future models will retain the same keyboard as many users have been complaining about the reliability of the butterfly keyboard.

But Kuo learned that there will be a bigger model with a 16-inch to 16.5-inch display. Let’s hope that Apple is going to trim down the bezels around the display.

TechCrunch already reported that Apple will release a new Mac Pro in 2019. But Kuo believes that the company is also going to release a high-end display to go with this Mac Pro. It could be a gigantic 31.6-inch display with a 6k resolution.

When it comes to iPhones, Kuo believes that Apple will release three models just like in 2018. They should retain the same screen sizes and Lightning connector. Some models may have three camera sensors on the back of the device. Face ID and wireless charging could both receive an upgrade with bilateral wireless charging.

It means that you could charge a second device using your phone, which is a great idea when you know that updated AirPods with a wireless charging case are also coming in 2019.

On the iPad front, the entry-level 9.7-inch iPad could become a 10.2-inch iPad with slimmer bezels. iPad Pro models will receive an update with faster processors.

As previously reported, a new iPad mini is still on the roadmap as well as an updated iPod touch. Finally, it sounds like the Apple Watch might only receive a minor update with ECG coming to international markets as well as a return of the ceramic option for the next version of the Apple Watch.

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