Ged Carroll

Search results for: “"Apple"”

  • Apple Is Trash + more news

    Apple Is Trash

    Why Apple Is Trash? Because Apple has demonstrated a moral bankruptcy in its behaviour. In the west, it is pro-LGBTQI, pro-security, pro-freedom etc. However its conduct elsewhere shows that it supports and strives to please authoritarian regimes.

    The Information on Apple in China, Apple’s Deal, Evaluating Apple’s China Risk – Stratechery by Ben Thompson – This analysis of what Apple did is, of course, distinct from the question of whether or not it was right. That is certainly something worth debating, but I suspect it is more of an academic question here in 2021. The time for Apple to decide whether to start the process of decoupling itself from China was when this deal was made; the company decided to go in the opposite direction — deepening its dependence in the process — and I don’t see it reversing anytime soon. The fact of the matter is that Apple isn’t simply the preeminent example of China’s manufacturing prowess – Apple Is Trash.

    Apple and China may renew their deal if both parties agree to do so, which means Apple may have continued stronger hold in China / Digital Information World – will Apple be seen in the same way by Xi now? How much lower will Apple need to? Will Apple Is Trash plumb new depths?

    What Apple’s removal of a Hong Kong protest app means for democracy – Vox – yet another example that – Apple Is Trash

    Despite all of the Apple is Trash things that they have done, it still doesn’t pay off: Apple’s nightmare before Christmas: Supply chain crisis delays gift deliveries – Nikkei Asia

    China

    Exclusive: Meet ‘Director K’, the MI5 spy responsible for keeping Britain safe from China and Russia

    President Xi of China lures Commonwealth with military diplomacy | World | The Times – which has implications for future demands of British military equipment sales and private military contractors in the developing world

    Chinese mining groups scour Afghanistan for opportunities | Financial Times

    Brief #98: sanctioning Lithuania, Didi delisting, China-Africa forum – the Lithuania sanctions move by China is interesting

    China-Pakistan Belt and Road Initiative hits buffers | Financial Times 

    China’s indebted property sector highlights a fading economic revival | China | The Guardian

    Chinese weddings fall to 13-year low as demographic crisis brews | Financial Times 

    Macao Casinos to Close Lucrative VIP Rooms in Wake of Junket King’s Arrest – Caixin Global – Melco Crown closing VIP rooms where whales from the Chinese junket trade would have gambled

    Exclusive: Lithuania braces for China-led corporate boycott | Reuters

    Consumer behaviour

    Is Britain entering an age of aggravation? – The Face – “My own, lefty inclination is that this is what happens when you continue to grind people up against each other in an increasingly competitive society. That years of austerity rule and a ​“fuck off” discourse are really starting to show”

    The Uncanny Valley: The Original Essay by Masahiro Mori – IEEE Spectrum

    Ethics

    Investigating Facebook: a fractious relationship with academia | Financial Times

    Mediatel: Mediatel News: Are future freedoms of expression under threat?

    China in the WTO – 20 happy years and (at least) one unfulfilled promise | Merics – forced technology transfer

    Finance

    Do AI-Powered Mutual Funds Perform Better? – ScienceDirect – AI-powered mutual funds significantly outperform their human-managed peers. AI-powered mutual funds show superior stock selection capability and lower turnover ratios to humans. – index trackers still important

    China property stocks rise as Beijing tries to ease Evergrande turmoil | Financial Times

    Facebook’s David Marcus, Creator of Embattled Diem Project, To Leave Company – Slashdot – its interesting, but then does Facebook need payments for a decentralised metaverse?

    Hong Kong

    China’s Didi to delist from New York and switch to Hong Kong | Financial Times

    Brain drain fears as Hong Kong secondary schools lose 4,500 pupils and 1,000 teachers in one academic year – survey – HKFP 

    Ideas

    Techno-optimism for 2022 – by Noah Smith – Noahpinion 

    Ireland

    How the bungalow took over the Irish landscape – great RTÉ documentary on how the plan catalogue Bungalow Bliss affected the Irish rural landscape

    London

    Calls grow for probe into Beijing’s influence after London Chinatown attacks — Radio Free Asia

    Luxury

    Pets Are Flying Private Like Never Before – Robb Report 

    Media

    Advertising Market Recovery 2022 COVID: Social Media to Overtake TV – The Hollywood Reporter

    Online

    SoftBank shares fall as value of portfolio companies plummets | Financial Times – not terribly surprising

    Retailing

    The Amazon Empire Strikes Back – Stratechery by Ben Thompson – For years, Amazon has been quietly chartering private cargo ships, making its own containers, and leasing planes to better control the complicated shipping journey of an online order. Now, as many retailers panic over supply chain chaos, Amazon’s costly early moves are helping it avoid the long wait times for available dock space and workers at the country’s busiest ports of Long Beach and Los Angeles… By chartering private cargo vessels to carry its goods, Amazon can control where its goods go, avoiding the most congested ports. Still, Amazon has seen a 14% rise in out-of-stock items and an average price increase of 25% since January 2021, according to e-commerce management platform CommerceIQ… Amazon has been on a spending spree to control as much of the shipping process as possible. It spent more than $61 billion on shipping in 2020, up from just under $38 billion in 2019. Now, Amazon is shipping 72% of its own packages, up from less than 47% in 2019 according to SJ Consulting Group. It’s even taking control at the first step of the shipping journey by making its own 53-foot cargo containers in China. Containers are in short supply, with long wait times and prices surging from less than $2,000 before the pandemic to $20,000 today.

    Security

    Tech Exec Brags That New Phone’ Cameras Will Always Be Watching You – Qualcomm not at all creepy

    Hefty jail term for Hong Kong Telegram channel admin convicted of inciting riot, arson and violence during 2019 protests – HKFP – what I am more interested in is how he was discovered as the Telegram admin

    CS Energy hit by Chinese cyberattack that almost cost 3m homes power | news.com.au – the link between the ‘criminal hacking’ community and government hackers in China due to the way talent has been recruited means that cyber warfare incidents sit in the kind of grey space that China likes to operate

    Web of no web

    Scientists develop wireless IoT networks for brain control | EE News Wireless – I immediately thought of the Clint Eastwood film Firefox

    Wireless

    Mobile data traffic has increased almost 300-fold with 5G to soar | EE News Wireless

    COTS Software Defined Radio for 5G Development by Bob Munro, Pentek 

    5G driving mobile and fixed markets convergence | EE News Wireless 

    SpaceX’s Starlink Is Testing Internet Service for Aircraft – Slashdot – big threat for Panasonic who is the leading provider at the moment

    New report sheds light on Apple’s supply chain issues, highlights pre-pandemic problems | AppleInsider

  • Apple Daily & other things this week

    Apple Daily

    Hong Kong newspaper Apple Daily closed down. It closed under government pressure. If we’re honest about it, it had been under government pressure for years. Advertisers were reluctant to be in the paper for years, partly due to government sentiment. Despite being Hong Kong’s most popular paper, it was running on loans that Jimmy Lai gave it.

    Apple Daily
    Final print edition of the Apple Daily published in Hong Kong

    It’s end came with a series of cuts. Jimmy Lai has had his assets frozen as part of the national security law related investigation. The Hong Kong government extended these charges to further senior employees of the Apple Daily. Then the Hong Kong government froze the bank accounts of Apple Daily and the related companies.

    The business had 67 million US dollars; so could have kept going for another 18 months until that freeze kicked in. As it was, the last paper would have come out on Saturday. On Wednesday the lead writer was arrested and the board decided to publish its last paper on Thursday. They printed 1,000,000 copies of the final edition which sold out. On previous days they had printed 500,000 to mark the asset freeze as Hong Kongers came out to support them. Back in the late 90s the paper was around 300,000 copies a day. The typical print run was 150,000 copies a day. The paper had about 500,000 paid subscribers. I was one of them. Yes their English copy was almost sub-Guardian standard (but with less typos of course). But their English language news has stories about Hong Kong business and China that other English language outlets didn’t cover.

    The security secretary John Lee warned people not to associate with Apple Daily employees, creating a white terror style scenario.

    A lot of the commentary from people who should know better has been about the Apple Daily‘s tabloid nature. Apple Daily was Hong Kong’s most popular paper for a number of reasons

    But they conveniently ignore Apple Daily‘s pioneering work in internet video journalism. Its investigative journalism and an editorial stance that called government to account. Stories last year included expat police officers breaking planning and property laws. But the Communist Party of China doesn’t want to be examined, let alone held to account.

    Hong Kong writer Sum Lok kei summed it up really well with this post that he put on Twitter

    Yes, ppl are aware of Apple Daily’s failings, their paparazzi arm and all. What is being mourned isn’t exactly the paper, but the possibility of its existence in this city that had prided itself for its witty discretions – now replaced by a monotonic, absolute drone.

    Via @sumlokkei on Twitter

    The Hong Kong government has been very opaque about the kind of journalism that is allowed. It is arbitrary and designed to promote severe self censorship.

    Apple Daily the night after it closed down
    images of the now closed Apple Daily fence with tributes from Hong Kongers via Guardians of Hong Kong Telegram channel
    Apple Daily the night after it closed down
    Apple Daily the night after it closed down

    It all hinges around the national security law:

    • Seccession includes acts ‘whether or not by force or threat of force’
    • Subversion or colluding with foreign countries are vague. So Apple Daily were accused with colluding with foreign countries without being in touch with them
    • The law isn’t supposed to be retroactive, yet Apple Daily content from before the July cut-off date is included in its alleged violations
    • China’s definitions of state interests are expansive
    • It is extra-territorial in nature. So this post that I have written could fall foul of inciting hatred of the Hong Kong and Chinese government. Despite the fact that this post is written and hosted outside Hong Kong. If I get shanghai-ed whilst transferring through an Asian airport you know what has likely happened

    But its just the media isn’t it? No.

    • if you’re a strategist in an advertising agency writing about consumer attitudes and touch on areas like what Hong Kong localism means for brands. This would affect how brands position themselves, I wrote similar positions for brands on Brexit supporters versus remain supporters. (Brexit supporters preferred local brands with nostalgia compared to remainers.) Or changes in attitudes to home ownership and buying homewares due to immigration. The kind of things that the government won’t like then you could be doing eight years to life in jail
    • If you write critical piece of analysis on bonds, Chinese or Hong Kong ‘well connected companies’ or forward-looking views on government policies. You could be doing eight years to life in jail
    • If you create a legal opinion on any of the above for a client. You could do eight years to life in jail
    • If you did a frank audit of a well connected company as part of the audit team of an accountancy firm. You could do eight years to life in jail
    • You do legitimate academic research in an area that the Chinese or Hong Kong governments and their hangers on don’t like. You could do eight years to life in jail

    All of this sounds like a bit of an exaggeration?

    While the world was looking on at trials of Apple Daily, major retailer Watsons withdrew special edition water bottles. The water bottles were designed with the slogan #Hong Kong is very beautiful. Presumably, they had originally been created to tap into Hong Kongers love of limited edition things celebrating their city and their love of hiking in oppressively hot weather.

    They were withdrawn due to perceived seccessionist overtones. Hong Kong is actually achingly beautiful with its futuristic skylines and natural environment. By comparison lot of the Chinese mainland is butt ugly like Hubei province or Beijing in winter.

    Bao Choy, a freelance producer who worked at RTHK was fined for ‘improper car plate searches’ carried out investigating Pro-Beijing forces inspired Triad violence at Yuen Long.

    A reporter at pro-Beijing paper Ta Kung Pao who accessed the same database, but was bound over instead.

    The Department of Justice said it agreed with the order, as Wong had a clean record and was working for the pro-Beijing newspaper when he made the licence plate searches.

    Ta Kung Pao reporter off the hook over car searches – RTHK.hk English news (June 17, 2021)

    Hong Kong brought in new film censorship rules banning documentaries on the protests and anything the government doesn’t like.

    The Hong Kong government is expanding its reach into accountancy diminishing the role of Hong Kong Institute of Certified Public Accountants.

    This would give Hong Kong increased insights into NGOs and political parties. Professional bodies in accountancy and law have been seen as a roadblock by the Chinese and Hong Kong governments. The movement against accountancy bodies is mirrored by moves against the legal profession. The latest move to make solicitors senior counsel turns the legal profession upside down.

    You are now restricted in accessing company registry data, making ownership structures opaque. This will provide boundless opportunity for corruption and fraud and Hong Kong becomes as opaque as mainland China.

    And in a news report from Hong Kong’s public service broadcaster RTHK:

    “If it’s a police state, why not? I don’t think there’s any problem with a police state. When we say a police state, I will view the other side, that is the emphasis on security,” 

    Pro-Beijing politician Alice Mak who is a affiliated with the Federation of Trade Unions quoted in Nothing wrong with HK being a police state: lawmaker – RTHK English news service.

    GPS for your feet

    Honda has been putting in thinking into pedestrian navigation that provides haptic direction instructions through your feet.

    More information from SoraNews24.

    Pride inspiration

    June is pride month and one of the best adverts that I have seen is by Pinterest. It has members of the LGBTQI community from around the world talking about sexuality and how they learned about themselves.

  • Apple souled out to China

    Apple designed in California and sold in China. Is it now Apple souled out to China? Apple is often cited as being a technology brand with a purpose and profiitable. It is unique in mobile phones, computers, tablets and set top boxes. It has a throw back model to the pre-Windows age of computing. It is vertically integrated.

    Quisling

    They make key software for their computer. They make the hardware. And in the case of every device except the Mac, they make the key components. It does all this without owning the means of production.

    Apple doesn’t own its factories. It owns some of the machines in assembly plants. But if a legal dispute broke out, it would struggle to get those machines out of a partner factory. It’s production volumes are so vast; this puts a further constraint on partner choice. Apple’s electronic components are made around the world:

    • Germany
    • Japan
    • Korea
    • Taiwan
    • China
    • USA

    The device chassis, battery and assembly happens in China.

    In software, Apple is reliant on two types of partners:

    • The open source community. iOS, macOS, watchOS and tvOS are all built on open source software. Apple takes them building blocks and innovates on top of them
    • The Apple developer community. Apple’s computers are nothing without software. On the iPhone about half the game developers are China based

    The Apple difference

    Their differentiator for the first thirty years or so was computing for non-technologists. Over time this has been articulated as:

    • Computing for the rest of us. Computers with expert product design that made them friendly in consumer eyes. This was to try and portray computing as an appliance or piece of consumer electronics. Brands as diverse as Sony and Cuisinart cited as inspiration. Critics of the Mac interpreted this focus on product design to call it a toy. They didn’t think that it represented ‘serious’ computing
    https://youtu.be/C8jSzLAJn6k
    • Think different. Apple needed to keep a fraying customer base together. They came up with the brand anthem that highlighted the diverse range of users. This ranged from technologists and scientists to artists and creatives

    https://youtu.be/cFEarBzelBs

    • It just works. It just works was initially used as a way to describe the intuitive Mac interface. My key attraction to the Mac was discovering thoughtful design at every aspect of the software. Even now, once you learn a keyboard short cut it works consistently in all software. In contrast, Ctrl + Q on Windows is inconsistent between some Microsoft apps

    Apple extended this process from the iMac onwards, making it easier to:

    • Get online. The modem was in the iMac’s case. You plugged your phone line into the computer. You plugged the computer in and followed the software instructions. Apple even carefully curated high quality dial-up ISPs (internet service providers)
    • Set your email up
    • Get your address book on to your phone – something that became even easier with the iPhone
    • Get your music on to your phone or iPod

    https://youtu.be/rnzCnPSQM7c

    The pivot to privacy started back in 2003 with the launch of FileVault. It makes it easy to encrypt a hard drive partition, CD ROM or USB key. This was to help the Mac find acceptability within business. It also benefited consumers. Eight years later Apple launches the iMessage service which encrypts text, image and video messages by default. It also launched FaceTime video calling with encryption. Two years later, Apple builds Secure Enclave into the iPhone; encrypting the entire device. Over time, the technology moved from being business friendly, to consumer differentiator. It gave Apple clear separation from Google and Facebook. Privacy fitted into a Cook narrative about a company that promoted social good. This was part of the move to a post-Jobs Apple. One that thought social purpose was more than addressing the education market with high quality products. Tim Cook and Apple stood up for American civil rights and progressive ideals.

    Concepts that in retrospect look rather naive when going into China.

    Compromises in China

    Apple has already given over control and cryptographic keys of its services in China. Apple users in China do not enjoy the kind of privacy and security protections of users elsewhere. Apple has not gone to the mats on behalf of users. Apple’s service offering has been severely restricted. Apple’s book offering had to be withdrawn. The app store is without whole categories of applications. Apple Music has a much reduced catalogue due to censorship. Check out Six times Apple gave in to China | Abacus for more information.

    Compromises to China

    The protests in Hong Kong shone a light on corporate kowtowing that has been going on for years. HKMap Live is similar to map / data mashups done for other protest movements. It plotted crowd sourced reports of police on a map.

    The data offered is not granular in nature. It might give you a pointer if you commute is going to pop-up in the middle of tear gas and baton rounds.

    This means that Tim Cook was gullible, or compromised when he made the following false statement about HKMap.live

    “…we received credible information, from the Hong Kong Cybersecurity and Technology Crime Bureau, as well as from users in Hong Kong, that the app was being used maliciously to target individual officers for violence and to victimize individuals and property where no police are present.”

    Tim Cook internal memo to staff

    The problem is no one has come out and said in public what these instances were. Apple hasn’t provided any supporting evidence. One could guess that Apple’s calculus was that people can still use Safari to access the HKMap.live site.

    But this comes on the back of Apple removing the Taiwan emoji from all iPhones using Chinese language input. That affects:

    • Chinese
    • Hong Kongers
    • Macau residents

    Tim Cook has gone from progressive corporate citizen to Tolkein’s Gríma (Wormtongue). So what’s Apple’s pay-off?

    Apple’s prospects in China

    You could argue that Apple’s best days are behind it in China. WeChat has effectively built a smartphone OS inside its application. This has meant that the iPhone’s differientators and real world performance compared to Android are moot.

    • Domestic manufacturers are squeezing Apple and Samsung out of the market
    • Tablets are less relevant due to Chinese preference for large smartphones.
    • Apple TV is crowded out of the market by Tencent content deals.
    • The Mac is a niche product that Apple is likely to maintain

    In the face of a changing political environment and rising Han nationalism; Apple is in decline. It’s a question of how fast, which means that Apple feels obliged to placate a mercurial Chinese state.

    Apple’s prospects on Capitol Hill

    Big technology companies under the magnifying glass by lawmakers. Apple doesn’t have the issues that Facebook has. But it did develop most of the tax avoidance measures now used by Facebook, Google and Amazon. And the one thing both Republicans and Democrats can agree on is that China is a bad actor that needs to be confronted. Apple sits nice at the intersection of these two issues. Tim Cook took a high risk gamble positioning Apple in political crosshairs – in the run up to an election. I guess like Mark Zuckerberg, Tim Cook is hoping Elizabeth Warren doesn’t get in.

    This also offers other technology companies a unique proposition. Their lobbyists could throw Apple under the regulatory bus for commercial advantage. Amazon’s lobbyists managed to blunt the threat of Apple Books to the Kindle book store. Do you think they or Facebook won’t offer Apple up as the sacrificial lamb?

    Thinking about trade specifically. Apple has already moved up to a third of iPhone assembly outside China due to the US | China trade difficulties. This leaves the rest of its products under threat:

    • From Chinese government action in the supply chain
    • From US government action against the supply chain

    If you’re an American politician, Apple looks like a corporate Quisling. On the right wing, it acquiesces to Chinese government pressure, yet won’t help the FBI. On the left, it avoids its tax responsibility and kowtows to an authoritarian regime that wants to displace America.

    Apple’s prospects with western consumers

    One can understand why Apple has thought it could get away with Chinese practices. It was something that other companies do:

    • Nike
    • Tiffany
    • Dolce & Gabbana
    • Starbucks
    • Mercedes-Benz
    • Marriott
    • Cathay Pacific
    • Muji
    • Versace
    • Dolce & Gabbana
    • United Airlines
    • Swarovski
    • Gap
    • Google

    Apple hasn’t had significant pushback or scrutiny of its Chinese practices. Unfortunately, Chinese government hubris, 愤青 (fenqing) and the NBA has brought Apple into sharp focus.

    The HKmap.live app is just the tip of a China iceberg:

    • It has handed over all the cryptographic keys for iCloud services in China to the government
    • iCloud hosting in China has been handed over to a Chinese state-owned company
    • Apple has censored books and music on behalf of the Chinese government
    • Apple has got rid of whole categories of apps like VPNs at the request of the Chinese Communist Party
    • It has pulled the Taiwan flag emoji from many devices
    • It’s handing over data to Tencent that bundles IP addresses with URLs. Apple claims its technique protects privacy, unlikely from the Chinese government technologists. Given a wide enough data sets and enhanced interrogation, you can whittle it down
    • Apple has requested that content providers on its new TV service censor themselves – not to offend the feelings of 1.4 billion Chinese people. Guessing South Park won’t be making content for Apple TV+

    This makes Apple look like a hypocrite.

    The San Bernardino lawsuit looks less like a stand for privacy a la Edward Snowden. Instead Apple looks like it prioritises the interests of the Chinese government over the US.

    There is a breach of trust for some Apple customers. Can you now trust Apple in other areas such as privacy?

    • How much of a threat would China have to make in order for Apple to hand over the keys to mail and messaging globally?
    • Or maybe just countries along the Belt & Road, which would include the European Union

    What would China do?

    • Banning the sale of iPhones?
    • Banning Apple Watches in China?
    • Ban the sale of AirPods?
    • Spiking Mac sales?

    Access to Apple’s global data would be an intelligence trove of kompromat. China wouldn’t be able to resist.

    If you’re an Apple customer, you know Apple just isn’t cool. The trust in Apple’s privacy USP is blown. You can’t be sure what Apple won’t do to make China or other governments happy.

    Western consumers are waking up to Apple having shattered an unwritten moral covenant, set by its progressive actions.

    In trying to avoid hurting the feelings of 1.4 billion Chinese people, Apple has burnt the trust of everyone else. And most of those 1.4 billion Chinese people Apple avoids offending won’t buy an Apple product. Which doesn’t look that great when you’re a shareholder.

    Apple and developers

    Prominent developers like Maciej Cegłowski (founder of pinboard.in) have been active in supporting Hong Kong protestors. It has put Silicon Valley developers on the opposite side to Apple. Cook will realise that there will be Apple insiders who sympathise with the Hong Kong protest movement.

    Taking the morality out of the equation for the moment, if you’re an Apple developer or employee; you know Apple won’t have your back. Why should you help them? Why would you help facilitate them use your open source code to build their products?

    More information

    Apple’s China Nightmare Just Got Even Worse | Forbes

    Apple Told Some Apple TV+ Show Developers Not To Anger China | Buzzfeed News

    How safe is Apple’s Safe Browsing? – A Few Thoughts on Cryptographic Engineering

    Apple insists it’s totally not doing that thing it wasn’t accused of: We’re not handing over Safari URLs to Tencent – just people’s IP addresses • The Register

    Apple’s decision to pull an app used by Hong Kong protestors shows how much it needs China – Vox 

    Daring Fireball: Tim Cook’s Company-Wide Memo on HKmap.live Doesn’t Add Up

    Apple in eye of China-Hong Kong storm | Digital | Campaign Asia

    Apple ditches Hong Kong maps app as China expands ‘loyalty test’ – Nikkei Asian Review

    Hong Kong Is the Latest Tripwire for Tech Firms in China | WIRED

    Chinese online retailers slash iPhone prices for second time this year | Reuters

    Apple’s spectacular $5 billion China black hole | Techinasia

    Apple’s Sales Drop in China Means $5 Billion in Lost Revenue – Bloomberg

    Apple in China Report 2017: A Deep Dive Into Apple’s China Troubles – China Channel

    Apple Starts Selling their HomePod in China, a Very Tough Market owned by Chinese Vendors – Patently Apple

    China retailers slash iPhone prices after Apple sales warning | Reuters

    Apple China warning: US businesses could lose out – CNN

    Apple Faces `Informal Boycott’ From China Consumers, BAML Says – Bloomberg

    Apple’s China Problem : 12 Reasons – Counterpoint Research

    Chinese Smartphone makers took advantage of Apple’s Out-of-Touch Pricing on iPhones & now Apple’s Supply Chain is Worried – Patently Apple

    Apple Warning: Seven Charts That Show the Pressure on China’s Consumers – WSJ

    Chinese Values Are Changing America – The Atlantic – China is transforming the US rather than the other way around

  • The Apple – Qualcomm deal post

    The Apple and Qualcomm deal ceased legal hostilities and lots of people have kicked around theories. But no one seems to definitively know what happened. And what the implications are for Apple.

    • If Apple was on such a sticky wicket, why didn’t it make a deal with Qualcomm earlier? A judge had asked them to sit down right at the beginning and they got nowhere
    • Did Intel explain to Apple that it wasn’t going to hit its engineering targets on the 5G modem (a la IBM and the PowerPCs that used to power Macs)? Or did Apple cut Intel off at the knees?
    • What does this all mean for Intel processors and components in Macs? From CPUs to USB C connectivity Apple is dependent on Intel. Even if Apple decided to move to an ARM architecture they would still likely need Intel foundries and connectivity processors. Before you talk about the Mac now being a small part of the business. Consider what mobile apps and even the iOS is developed upon. Secondly a Mac user is far more likely to be an iPhone, iPad, Apple Watch and Apple TV customer
    • From a functional handset perspective I am not convinced about the benefit of 5G. But from a marketing perspective it could be very damaging to Apple eventually. How far behind would Apple developing a new 5G solution from scratch be? It would be reasonable to expect for Qualcomm to service other clients first and then only put under performing engineers on Apple as a punishment duty. Given that Qualcomm laid off engineering teams, engineers may only work on Apple grudgingly. Is it even viable for Apple to bother with 5G iPhone? If we look at history, the Qualcomm – Nokia IP deal was the beginning of the end for the Nokia handset business in 2007. Apple might lose money up front, but it would save on the kind of value destruction Nokia went through
    • What is the state of Apple’s relationships with the rest of its supply chain and can it expect a kicking?
    • Whilst mobile carriers wouldn’t be happy to have a single OS eco-system in smartphones, they’ve had zero success in championing other platforms (BlackBerry, Windows Mobile, WebOS and SailfishOS). All of this would make them even more beholden to Google. So would an alternative OS’ spring up to fill the iPhone gap?
    • Can Qualcomm use this to try and smother antitrust investigations outside the US?


  • Apple and Jaguar Land Rover in China

    Apple and Jaguar Land Rover blamed the Chinese economy for their recent financial results. The truth is probably more complex. What factors are affecting affecting Apple and Jaguar Land Rover that aren’t directly related to the Chinese economy?

    The reality is that Apple and Jaguar Land Rover are being buffeted by very different forces, some of which are their own making.

    Apple

    China is a unique mobile environment and in some ways it mirrors the hopes (and fears) for the internet in the late 1990s. Oracle and Sun Microsystems spent a lot of time during the dot com boom developing technologies that would allow applications to run on the web. Enterprise software sudden had a user experience that could be accessed via a web browser. Java allowed applications to be downloaded and run as needed. Netscape had a vision of the internet replicating the operating system as a layer that would run applications. Microsoft also realised this which was why they developed Internet Explorer, integrated it into Windows and killed off Netscape. The Judge Jackson trial happened and that was the start of the modern tech sector allowing Google and Apple to rise.

    Move forwards two decades and most computing is now done on mobile devices. In China, WeChat have managed to achieve what Netscape envisioned. Their app as a gateway to as many services as a consumer would need including a plethora of mini applications. It doesn’t suffer the problems that native web apps have had in terms of sluggish user experiences. In addition, WeChat has invested in a range of high-performing start-ups to built a keiretsu of businesses from cab services, e-commerce, property companies and even robotics. In the meanwhile Tencent who own WeChat have a range of consumer and business services as well.

    What this means for Apple is that many of its advantages in other markets are negated in China. The OS or even performance of a smartphone doesn’t matter that much, so long as it can run WeChat and a couple of other apps. The look and feel of the app is pretty much the same regardless of the phone OS. Continuity: where the iPhone and a Mac hand-off seamlessly to each other doesn’t matter that much if many consumers use their smartphone for all their personal computing needs.

    This has been the case for a few years now in China – but Apple haven’t found a way around it.

    As for phone industrial design – Apple lifted the game in manufacturing capability by introducing new machines and new ideas. To make the iPhone 5, Apple helped its suppliers buy thousands of CNC machines. This grew the manufacturers capability to supply and the amount of pre-owned machines that eventually came on the marketplace. It meant that other manufacturers have managed to make much better phone designs much faster.

    That meant Chinese consumers can buy phones that are indistinguishable from an iPhone if you ignore the logo and function the same because of China’s app eco-system. Again this has been the same for a few years and has accelerated due to the nature of the dominant smartphone form factor. The second iteration of the iPhone X form factor is what really changed things. The phones were different to what has come before, but they weren’t demonstrably better. They were also more expensive.

    In the mean time Huawei and others have continued to make progress, particularly in product design and camera technology – the two areas where Apple led year-on-year. Huawei devices can be expensive for what they are, but they gave domestic manufacturers ‘brand permission’ in the eyes of many Chinese consumers to be as good as the foreigners.

    This wasn’t helped by Samsung’s missteps in the Chinese market that started with the global recall of the Samsung Galaxy Note7 battery recall. Samsung hasn’t managed to make that gap back up and seems to make marketing missteps regularly such as its recent tie-in with the ‘fake’ Supreme brand holder China. If you’re a Chinese consumer the additional value or status that you used to see in foreign handset brands is now diminished. This seems to be a wider theme as domestic brands are also making similar gains in market share compared to foreign FMCG brands. Although there are also exceptions like baby formula.

    Domestic brands have done a good job marketing themselves. BBK in particular are very interesting. Whilst Huawei makes lots of noise and bluster at how big they are, BBK creeps up. It has a number of brands in China and abroad OnePlus, Oppo, Vivo and RealMe going after particular segments. The brands are focused but run separately like companies in their own right. Apple’s marketing riffs on its global marketing (though it did a great Chinese New Year themed ad last year). This reinforces the perceived common view that foreign businesses are full of hubris and don’t sufficiently localise for China. Apple’s recent pricing strategy in a market where this is so little to show in value provided looks like the epitome of hubris.

    180120 - China smartphone market

    Finally, there has been a massive amount of consolidation of brands in the China smartphone market over the past four years. That provides for scale in terms of logistics, supply chain, design, component sourcing and marketing.

    Jaguar Land Rover

    If we move to the automotive sector and look at Jaguar Land Rover – their problems in China look self inflicted. China’s car market has declined for the first time in 20 years. But it seems to have mostly affected brands like Hyundai rather than prestige brands like Mercedes Benz or BMW. The reasons why aren’t immediately apparent. Yes diesel cars are less popular, but BMW, Audi and Mercedes make diesel cars.

    Jaguar Land Rover aren’t the only foreign brand suffering: Toyota has had problems in China since the last round of strong anti-Japanese sentiment exploded in 2012.

    More information

    Why Does WeChat Block Competitors, While Facebook Doesn’t? | Walk The Chat

    Apple’s China Problem | Stratechery

    Samsung recalls Galaxy Note 7 worldwide due to exploding battery fears | The Verge

    Samsung angers hypebeasts by partnering with fake Supreme brand in China | The Verge

    Fake News: Samsung China’s Deal With Supreme “Knock-off” Spurs Drama | Jing Daily

    Chinese car sales fall for first time in more than 20 years | World news | The Guardian

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