Company / division: Services

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    Apple Reduces App Affiliate Fees from 7% to 2.5% With a Week’s Notice (Apr 24, 2017)

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    ★ Analysis Suggests Apple’s Chinese Market Share Decline is Due to Poor Services (Apr 22, 2017)

    Backchannel has a piece out this week which argues that the iPhone’s declining market share in China is due to the poor competitiveness of its services, notably Apple Music and Apple Pay. The piece is well worth reading, but it offers few real answers. It states that Apple fails to compete effectively with its music and payment services in China, but then also says that the music and payments markets in China have been sewn up by strong local competitors, with music rights in particular subject to exclusives from Chinese services. As such, it’s really not clear what Apple could have done differently in these categories. At the end of the day, Apple’s lack of competitiveness in services in China is a symptom of a much broader issue, which is that Apple doesn’t bend much to local custom when it comes to pricing or service structure (see also India). It does localize content stores, and indeed is one of the strongest players in that respect globally, but China is such a massive market, has so many homegrown competitors, and is run by a government which is not afraid to disadvantage foreign interlopers, that it’s hard to see how Apple could compete effectively there on services. As such, I think it’s smart to compete more on its devices, its growing retail presence, and its non-content software and services. But that does mean that the ecosystem Apple has built elsewhere is missing some of the appeal it has elsewhere.

    But all that is to ignore the central premise of the argument being made here, that it’s this services weakness that’s at the root of the recent decline in iPhone market share in China. I think that’s debatable at best, and it’s worth remembering that that decline isn’t about ownership but sales, and Apple went through a massive cycle earlier off the back of the iPhone 6 in China, and then came down to earth over the ensuing year, so that change in market share is reflective of cyclical rather than permanent trends, with some signs of recovery recently with the iPhone 7. So overall this piece feels like it makes some interesting points, some of them legitimate with regard to Apple’s services competitiveness in China, but overdoes the narrative about its impact.

    via Backchannel

    Apple News is Starting to Generate Decent Traffic for Some Publishers (Apr 20, 2017)

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    Apple Acquires First Movie at Tribeca Film Festival (Apr 20, 2017)

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    Apple Makes iMovie, GarageBand, and iWork Apps for Mac and iOS Free for All Users (Apr 18, 2017)

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    Apple’s Clips app offers promising & fun editing features, but confusing & difficult UI – 9to5Mac (Apr 6, 2017)

    Apple announced the Clips app a couple of weeks ago along with the new iPad and other announcements, and when I commented on that announcement I said the proof would be in the pudding with regard to how well the app performed. We now have reviews (and the app itself is out now too), and it looks like a bit of a mixed bag. The app looks clever, with some nifty new features, but it looks like it may suffer from the same problem as some other Cook-era Apple product releases, in that it seems like it may try to do too much, and therefore can be confusing to use. Here, as with the Apple Watch, Apple Music, and other recent efforts from Apple, it looks like it may have been better served by starting simpler and adding functionality over time. The real test will be whether we start seeing Clips-generated videos showing up in a big way on Instagram, Snapchat, and Facebook, because since this app lacks its own social features the output needs to be shared elsewhere. I still suspect, as I said in my first comment, that this is a better fit for the older Facebook generations than the Snapchat and Instagram generation, but we’ll see.

    via 9to5Mac

    Apple Pay Promised to Make Plastic Obsolete. Then Came Wary Shoppers, Confused Clerks – WSJ (Apr 5, 2017)

    It’s been clear from the very beginning that Apple Pay was only going to get so far as long as most retailers didn’t support the technology. Mobile payments are a tough habit to get going when it only works occasionally, and when there’s significant uncertainty about whether it will work at a given retailer, and both are certainly the case right now. As such, I would guess that many iPhone owners have either never tried it or tried it once or twice only to stop using it because it’s rarely available as a payment mechanism. Compounding the problem is the fact that, though the EMV liability shift drove adoption of new payment terminals, and many of those terminals have NFC capability, but Apple Pay support is switched off because retailers favor other methods of payment. As such, even the widely-recognized contactless payment symbol present on many terminals is no guarantee of availability. Ultimately, unless acceptance rates at retailers rise considerably, adoption by users it going to continue to be a long, slow slog.

    via WSJ

    Apple wants to sell HBO, Showtime and Starz in a single bundle – Recode (Apr 3, 2017)

    Apple has been reported to be working on some kind of subscription TV service for years now, and yet nothing has ever come to fruition. Meanwhile, Amazon has gone ahead and quietly built a fairly interesting set of TV service components under the Amazon Channels banner. That set of components includes the big premium channels mentioned here (HBO, Showtime, and Starz, as well as Cinemax), but also lots of more niche channels including several targeting particular genres or international content. If Apple wanted to build a similar service, I’m sure the pay TV providers would be amenable, and the big sticking point would probably be pricing for such a bundle: Amazon charges the same rates for the three channels as Apple does on a standalone basis at the moment, with the exception of Showtime ($9/month vs. Apple’s $11/month), but Apple would want to provide some kind of bundle discount. To take a step back for a minute from this specific offer, it’s worth thinking about trends in online video at the moment. Whereas one of the big trends we’ve seen so far is one of disaggregation, with these premium channels and others offering standalone apps and services, people want aggregation, both for the price and convenience benefits of bundling, but also having a single user interface for consuming this TV content. With its new TV app, Apple has such a user interface, and I’d expect it to try to add more and more channels into that interface over time. Beyond Apple, I suspect this kind of aggregation will be a big theme this year across providers.

    via Recode

    App Annie: Android to top iOS in app store revenue this year – TechCrunch (Mar 29, 2017)

    This App Annie analysis is interesting for two reasons. Firstly, it’s one of the first times I’ve seen anyone attempt to quantify the whole Android app ecosystem including the third party app stores, which are a factor globally but particularly important in markets like China, where Google Play basically doesn’t exist. That provides a much better view of the whole ecosystem, but of course Google only benefits directly from the part it controls, which is Play. Secondly, though, the forecast that this ecosystem combined will surpass Apple’s app ecosystem by the end of the year is striking because the Android user base has been much larger than the iOS user base for years, and only now is the app ecosystem (on this more inclusive basis) starting to rival Apple’s. That, in turn, is a symptom of just how completely Apple has dominated the premium users within the smartphone market, those who are more likely to pay for content and apps. But all of this is also a great refutation of the idea that apps are somehow dying or about to be replaced with something else – the sheer growth numbers here are astonishing.

    via TechCrunch

    Apple Extortionists Seemingly Trading Media Exposure for More Accounts – Motherboard (Mar 28, 2017)

    This story has been somewhat misreported, although this article does a decent job. It appears a hacking collective is claiming to have lots of username / password sets for iCloud accounts, though it appears that the source of the data is a hack of some other site or sites rather than any of Apple’s own. That breach then seems to have allowed the hackers to take email addresses and the passwords used on other sites and use them to access iCloud services as well. In other words, this isn’t an Apple hack at all, and is only effective because people are reusing passwords on multiple sites. Using two-factor authentication and unique passwords is therefore still the best defense against this kind of thing, although Apple still has to deal with the headache of both false claims and threats from this hacking group.

    via Motherboard

    Apple’s App Store Gets a Makeover – Bloomberg (Mar 21, 2017)

    The headline makes it sound like there are changes coming to the App Store, but this story is really about all the changes that have already happened on the App Store since Phil Schiller took it over from Eddy Cue a little over a year ago. One of the notable things in the story is the impact that better analytics have had, and how that’s made it easier for more dynamic developers to update their apps more frequently in response to user behavior. More generally, though, the article suggests that big strides have been made in the way the App Store runs from a developer perspective, which is a story that hasn’t been told much. It’s been subtle, and if you’re just a user you might not be aware of most of these changes, but better experiences for developers make for better end user experiences too. I know there are still lots of developers, especially Mac-centric developers, who have complaints they feel have gone unheeded, but Apple has at least made some progress in fixing big pain points on the iOS side.

    via Bloomberg

    Apple Debuts Clips, a New Way to Create Videos on iOS (Mar 21, 2017)

    Alongside the iPad announcement it made this morning, Apple made three other announcements, of which this is the most interesting (the other two concern a PRODUCT(RED) iPhone and new languages for Swift Playgrounds). Clips looks like a hybrid of Snapchat and iMovie, with lots of new filters, stickers and other effects and an easy editor for creating a montage of video clips and photos, but apparently without any kind of social component. This is a funny sort of inbetweener software product from Apple, which doesn’t have an explicit social network and whose creative tools around editing photos and videos are far less used among young people than those which come with the social networks they use. I don’t necessarily see that changing with this product, though there are some clever-looking features like auto-generating titles. The proof will be in the pudding, though – the app comes out in April, though I’m guessing it may appear in developer betas before then, giving us a chance to try it out. It’s interesting to see Apple experimenting to try to fill a gap here, but I’m not convinced it’s got it right just yet.

    via Apple

    Six months in, iMessage App Store growth slows as developers lose interest – TechCrunch (Mar 17, 2017)

    I think there are at least a couple of ways to read this data set, one of them not so good for Apple and one of them more neutral. The first is the one this article favors, which is to say that the slowing growth in iMessage apps is down to lack of user engagement with them, and I think that’s entirely reasonable. I downloaded one or two in the first day or two after they became available, thought they were fun, and have never either used them or downloaded more sense, and I would guess I’m not atypical. But I’m probably also not the target market for most of these little apps, which were always likely to be more popular among younger people and probably geographies other than the US, so I’m loath to extrapolate too much from my own experience. The other way to read this data is that iMessage apps are so ridiculously simple to create that anyone who wanted to create one did so very quickly after the tools became available, in marked contrast to Apple Watch or Apple TV apps, which required quite a bit of development time to create. And so now we’re seeing a low maintenance rate of growth from those who came to the market later or are making second or third apps. The Sensor Tower data itself doesn’t help identify which of these is the right explanation, and in reality I expect it’s a bit of both. The far more interesting data set would be revenue from these apps and how that’s changing over time.

    via TechCrunch

    Apple could kill almost 200,000 apps with iOS 11, report says – Mashable (Mar 15, 2017)

    This isn’t the first time we’ve seen a claim like this – Apple has been hinting at dropping apps that haven’t made the switch to 64-bit from the App Store for quite some time. While it’s good to get some sense of how many apps might be affected – Sensor Tower says 8% or 187,000 apps – what’s missing from this analysis is whether any of those apps are actually ones people care about or use today. My guess is that there are very few apps in the App Store which haven’t been updated in years and still see significant usage – I can only think of one app I use today which would fall into this category, and that’s because it’s been superseded by a new version which dropped some features I use. So even though the number here sounds dramatic, my guess is that dropping these apps in iOS 11 – if that is indeed what’s going to happen – will have minimal negative impact on users, and potentially remove some dead wood from the App Store in the process.

    via Mashable

    Apple’s Siri learns Shanghainese as voice assistants race to cover languages – Reuters (Mar 9, 2017)

    One of the things that’s often missed by US writers covering Amazon’s Alexa and its competitors is how limited it still is in language and geographic terms. It only speaks English and German and the Echo range is only available in a handful of countries. Siri, meanwhile, just got its 21st country and 36th language, which reflects a long-time strength of Apple’s: broad global support. Apple News is a notable exception, which is only available in a few countries and one language, but almost all of Apple’s other products are available in a very long list of countries and territories, often longer than for other competing services. The article here is also interesting for the insights it provides into how each company goes about the process of localization, which is quite a bit more involved than you might surmise.

    via Reuters

    Apple looking to buy TV shows and studios – Business Insider (Mar 3, 2017)

    There’s not much in this report to suggest that Apple is actually interested in buying a studio, and indeed Imagine strongly refuted reports to that effect recently after those reports surfaced. Reports that Apple wants to acquire TV shows, on the other hand, are a lot more plausible – it’s already bought or commissioned a couple for Apple Music, and I could see it doing more of this, especially if it’s finally getting serious about building its own subscription TV service. The comments in here about the confusion over who’s leading the negotiations are a bit more worrying – if they’re true. Eddy Cue obviously does oversee the overall effort here as head of Apple’s content business, but he might well delegate some of the actual negotiations to other team members, and Jimmy Iovine in particular is known to have good relationships in the content industry. Recent reports about the change of leadership over Apple TV hardware suggested that Pete Distad was going to be taking the lead on these negotiations, and his name isn’t even mentioned, so there do seem to be a lot of people involved here. Hopefully Apple is clearer on this than some of those it’s approached seem to be.

    via Business Insider

    Apple Debuts Planet of the Apps Trailer – Recode (Feb 14, 2017)

    Apple debuted the trailers for its Planet of the Apps and Carpool Karaoke shows at the Code Media conference last night. These are two of Apple’s first bits of original video content, both of which will debut as part of Apple Music. Carpool Karaoke still features James Corden on some episodes, but not all, which will detract at least somewhat from the original format, which is compelling in large part because of him. Planet of the Apps is a Shark Tank-style reality / competition show focused on apps. This clearly plays to Apple’s strengths, and gives potential competitors a big draw in the form of featured placement on the App Store. This isn’t my kind of thing – I’ve never been a big fan of reality shows – but Shark Tank is very popular, and Apple’s show mirrors its format pretty closely, so it should do well among the same people that like that show. In addition to music exclusives, these bits of video content are another unique feature of Apple Music, which should help set it apart versus the competition. But to my mind, it’s more interesting to see this as an ongoing push by Apple into original content, which for now may live in Apple Music but certainly has the potential to become the foundation of an Apple subscription video service in future, which could be a much bigger deal.

    via Recode (Planet of the Apps trailer here)

    Making More Outside The Mac App Store – Rogue Amoeba (Feb 10, 2017)

    Some interesting data points here from Rogue Amoeba, one of the medium-sized Mac app developers which has recently pulled the last of its apps from the official Mac App Store, and has seen roughly similar unit sales and slightly higher total revenues as a result. Although the iOS App Store continues to be the only way to get apps onto an iPhone or iPad, that’s not the case with the Mac, and frustrations over sandboxing, limited business model options, and the lack of formal upgrade mechanisms among other things have driven a number of prominent developers to eschew the MAS for direct sales. It continues to be fascinating how Apple’s approach to the Mac App Store has been so much less successful, in part due to the longstanding existence of alternatives, but in part also due to Apple’s inflexibility and lack of support for key developer requests. For all Apple’s strength and success with developers broadly, its Mac developer story is a lot less compelling.

    via Rogue Amoeba

    Apple Pay most popular mobile payment service among US retailers, survey finds – NFC World (Feb 7, 2017)

    This survey suggests that Apple Pay is the most popular mobile payment service among 500 top retailers surveyed by Boston Retail Partners (BRP). It beat out PayPal (which I’ve never seen at retail other than at Home Depot, but appears to be largely used by smaller entities rather than big chains), and a variety of other card network-, bank, or store-specific alternatives like Chase Pay, MasterCard PayPass, and Visa Checkout, as well as Android Pay, which was accepted by 24% versus Apple Pay’s 36%. That’s good progress for Apple Pay, but still makes it a minority option even among these larger retailers, which tallies with my own experience of trying to find places to use it – where I live, two of the nearby grocery stores take it, but our closest and default store doesn’t, Subway and one or two other fast food places take it, but most don’t, and several other places (including CVS) have NFC-enabled terminals but block Apple Pay. The progress is good, but until Apple Pay is available more often than not, I suspect many people will just never bother trying – there’s too much embarrassment around a failed payment for most people to endure the trial and error process it often entails.

    via NFC World (original report in PDF here)

    Apple now offers Final Cut, Logic, and other pro apps for $199 through education bundle – 9to5Mac (Feb 4, 2017)

    Apple has always been strong in the education market – a much higher percentage of schools than homes use Macs as their primary computers, and hardware discounts have been part of that strategy for a long time. But recently Google has made significant inroads in education with a combination of Google Apps and Chromebooks, and of course a big part of the appeal is that the software is free or very cheap. By contrast, both Apple’s hardware (whether iPads or Macs) is expensive, even with discounts, and its pro creative software runs to several hundred dollars each for the core apps. This new bundle addresses that by bringing the price down quite a bit (given that the bar a customer has to clear to qualify for the bundle is pretty low, it can’t be priced too aggressively or it’ll undercut sales much more broadly), making it more affordable for schools. Many schools, of course, won’t require anything beyond iMovie or GarageBand for movie and audio editing respectively, but for those teaching higher-order creative tasks, this will help bring down the costs of those programs.

    via 9to5Mac