Didi and Grab Leaders Speak at Code Conference, Didi Discusses Apple and the Future, Coach Developing Apple Watch Bands
Today's Above Avalon stories:
- Didi and Grab Leaders Speak at Code Conference
- Didi Discusses Apple and the Future
- Coach Developing Apple Watch Bands
We kick off today's email by discussing my thoughts and observations from Didi president Jean Liu's and Grab co-founder and CEO Anthony Tan's presentation at Recode's Code conference. Given Apple's recent investment in Didi and the company's pivot into transportation, there is much value in listening to two leaders of the ridesharing industry. In particular, we focus on Jean Liu's comments about Apple, the differences between the U.S. and Chinese auto industries, and where ridesharing is headed in the future. The email concludes with a look at Coach developing Apple Watch bands. We discuss the broader implication Coach Watch bands will have on the Apple Watch ecosystem.
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Elon Musk's Problem with Apple, Wireless Smart Earphones 101, Samsung Gear IconX Wireless Earphones
Today's Above Avalon stories:
- Elon Musk's Problem with Apple
- Wireless Smart Earphones 101
- Samsung Gear IconX Wireless Earphones
We begin today's email by taking a closer look at how Elon Musk has a problem with Apple. His comments have become weirder and stranger over time and there is evidence that Musk may have a problem with Apple along philosophical lines. The email then shifts over to wireless smart earphones. After going over my overall view and opinion on the very young product category, we discuss Samsung becoming the first large manufacturer to enter the wireless earphone industry with the Gear IconX. In addition, we discuss the implications wireless smart earphones will have on Apple and the company's product roadmap.
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A Smarter iPhone, Uber and Didi Raising Billions of Dollars, Thursday Q&A
Today's Above Avalon stories:
- A Smarter iPhone
- Uber and Didi Raising Billions of Dollars
- Thursday Q&A
We kick off today's email by discussing a WSJ article by tech columnist Joanna Stern concerning the iPhone becoming an "empty shell" as Apple apps lose out to competing services. I share my perspective on the current services landscape and how Apple views the situation. The email then turns to news that Uber raised $3.5 billion as Chinese ridesharing company Didi plans an even larger capital raise. I have a number of observations about these developments and their broader impact on the ridesharing industry. We conclude with Thursday Q&A (questions from Above Avalon members). This week's questions:
- Why would Apple need to buy stakes in ridesharing companies when there wasn't a need to invest in mobile carriers when launching the iPhone?
- Is Google trying to be more like Snapchat with Instant Apps considering their ephemeral nature?
- Do you think Elon Musk would sell Tesla?
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Apple M&A Is Evolving, Ridesharing's Limiting Factor, Thoughts on a Three-Year iPhone Product Cycle
Today's Above Avalon stories:
- Apple M&A Is Evolving
- Ridesharing's Limiting Factor
- Thoughts on a Three-Year iPhone Product Cycle
We begin today's email by continuing the discussion from yesterday's Above Avalon article, "Apple M&A Is Entering a New Phase." Specifically, we look at how Apple M&A will evolve in the transportation industry. The email then shifts over to Uber signing a new $1 billion deal to finance subprime auto loans. We discuss ridesharing's limiting factor and the implications on a future Apple Car, including financing options for such a product. We conclude with a few of my thoughts on reports that Apple is moving to a three-year iPhone product cycle.
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Jawbone's Last Stand, Declining Developer Interest in Apple Watch
Today's Above Avalon stories:
- Jawbone's Last Stand
- Declining Developer Interest in Apple Watch
We kick off today's email by taking a closer look at two recent developments concerning Jawbone's speaker business and UP fitness trackers. The company appears to be taking a last stand when it comes to wrist wearables. We discuss the news and implications it will have on the broader wrist wearable space. We then turn to a polarizing Business Insider article on Apple developers losing interest in Apple Watch. We take a deep dive into what may be going on and a few observations that I had concerning the factors driving lackluster developer interest in the Watch. There are a few things to keep an eye on regarding watchOS heading into WWDC.
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Tim Cook Discusses Apple's 10-Year Outlook, Apple Researching Electric Car Charging, Thursday Q&A
Today's Above Avalon stories:
- Tim Cook Discusses Apple's 10-Year Outlook
- Apple Researching Electric Car Charging
- Thursday Q&A
We begin today's email by going over Tim Cook's interview with Neelie Kroes in the Netherlands earlier this week. A number of Cook's comments caught my attention. We then turn to news that Apple is researching electric car charging. While the subject may not be shocking given Apple's intention to sell an electric car, we use the opportunity to begin discussing some of the larger issues concerning electric car charging infrastructure. The email concludes with Thursday Q&A (questions from Above Avalon members). This week's question:
- "Should Apple buy Netflix?"
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Apple to Launch Siri SDK at WWDC, Apple Working on Siri Speaker, Toyota Partners with Uber
Today's Above Avalon stories:
- Apple to Launch Siri SDK at WWDC
- Apple Working on Siri Speaker
- Toyota Partners with Uber
We kick off today's email by taking a closer look at The Information's report that Apple will launch a Siri SDK at WWDC next month. The best way to analyze this news is to take a step back and take a broader look at Siri. We discuss the two reasons why Apple has been holding back Siri and why the environment is changing. The email then turns to news that Apple is also reportedly working on a Siri speaker similar to Amazon Echo. We conclude with a closer look at Toyota partnering with Uber (and VW partnering with Gett). It continues to be very busy in the ridesharing industry.
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Xiaomi Hits a Wall in China, Spotify's 2015 Financials, Uber Begins Testing Self-Driving Cars
Today's Above Avalon stories:
- Xiaomi Hits a Wall in China
- Spotify's 2015 Financials
- Uber Begins Testing Self-Driving Cars
We begin today's email by taking a closer look at Xiaomi's growing list of troubles. After covering the company's overall revenue, smartphone unit sales, and services revenue shortfalls in 2015, we take a step back to see a few broader implications on the Chinese smartphone market. The email then turns to Spotify and the company's latest financials. We break down the numbers to reach a few observations on the company and music streaming in general. We conclude with Uber beginning to test its self-driving cars. This is a pretty big event in the automobile world.
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Above Avalon Is Officially Sustainable, Apple Presses Reset Button in India, Don't Expect a Special, Cheap iPhone for India
Today's Above Avalon stories:
- Above Avalon Is Officially Sustainable
- Apple Presses Reset Button in India
- Don't Expect a Special, Cheap iPhone for India
We kick off today's email with a few words on the first-year anniversary of Above Avalon membership and the daily updates. We then take a closer look at Tim Cook's 38-minute interview with NDTV in India. Cook discussed a number of important topics concerning Apple's long-term strategy for India. The email then turns specifically to the topic of iPhone in India and why Apple is not going to release a special, low cost iPhone model just for India.
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Google I/O 2016, Apple vs. Google, Thursday Q&A
Today's Above Avalon stories:
- Google I/O 2016
- Apple vs. Google
- Thursday Q&A
Today's email goes over my thoughts and observations about Google's I/O 2016 keynote. After discussing my overall reactions, we go over some of the products and features introduced onstage. We then take a step back and compare Google's ambition to move beyond devices with Apple's core competency in hardware. The two strategies seem to be at odds with each other. The email concludes with Thursday Q&A (questions from Above Avalon members). This week's questions:
- "What percentage of Didi did Apple purchase?"
- "Do you consider Apple Watch to be a Steve Jobs legacy endeavor?'"
- "What did you mean Buffett's IBM purchase has to do with financial engineering?"
- "If Apple captures 95% of smartphone profits, how can other companies continue to innovate in the space?"
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Apple TV Unit Sales Estimate, The Skinny Cable Bundle Mirage, Tim Cook Visits China and India
Today's Above Avalon stories:
- Apple TV Unit Sales Estimate
- The Skinny Cable Bundle Mirage
- Tim Cook Visits China and India
We kick off today's email by discussing Apple TV sales share in the U.S. After looking at the latest trends, we go over my estimate for Apple TV unit sales on an annual basis. The discussion is then broadened to go over why I think the skinny cable bundle will end up being a mirage to many tech companies, including Apple. The email concludes with some thoughts and perspective on Tim Cook's trip to China and India. There is way too much cynicism in the press regarding his trip.
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Berkshire Hathaway Buys AAPL Stake, Deep Dive into 1Q16 Wearables Market
Today's Above Avalon stories:
- Berkshire Hathaway Buys AAPL Stake
- Deep Dive into 1Q16 Wearables Market
Today's email begins by taking a closer look at Berkshire Hathaway buying a $1 billion stake in AAPL. We discuss the notion that the move suggests Apple is now a value stock. Upon closer examination, Berkshire Hathaway's thought process towards AAPL isn't too mysterious. The email then turns to new data for the wearables market. We look at the latest smartwatch and fitness band sales trends with additional comments about the broader wearables market in 1Q16.
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Apple Invests in Didi Chuxing
Today's email is dedicated to Apple buying a $1 billion stake in Didi Chuxing, China's largest ridesharing company. The email is divided into a number of sections:
- Didi Chuxing 101 - A Didi Chuxing Primer.
- Investment Rationale - The three primary reasons for Apple investing in Didi.
- The Ridesharing War - A closer look at why the ridesharing industry is turning into an "Uber vs. everyone else" war.
- Apple's Game Plan - My theory on Apple's plan for Didi and ridesharing.
- What's Next? - Details on what I'm expecting in terms of Apple making additional ridesharing investments.
- Conclusion
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Project Titan Is Different, Tech R&D Isn't Created Equally, Thursday Q&A
Today's Above Avalon stories:
- Project Titan Is Different
- Tech R&D Isn't Created Equally
- Thursday Q&A
Today's email builds off my article "Apple R&D Reveals a Pivot Is Coming." We begin by discussing the motivation behind the article and why public reaction surrounding Apple changed two weeks ago with 2Q16 earnings. The email then goes into greater detail on why I think Project Titan is very different from the typical Apple R&D project. This uniqueness is the reason for my very high level of confidence that we will indeed see an electric car from Apple. We then go over some of the R&D data for the tech industry that I collected while researching the article. There are a few interesting observations worth discussing. The email concludes with Thursday Q&A (questions from Above Avalon members). This week's questions:
- "What is classified as Apple R&D?"
- "In what year do you believe Apple will no longer be referred to as 'the iPhone company?'"
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The Swiss Watch Market Is Collapsing, Fossil on Traditional Watch Market: It's Awful, Good Signs for Apple Watch
Today's Above Avalon stories:
- The Swiss Watch Market Is Collapsing
- Fossil on Traditional Watch Market: It's Awful
- Good Signs for Apple Watch
Today's email has a watch theme. We begin by taking a closer look at the latest Swiss watch market export data. Not only do things look quite negative but the situation is worsening. We go over the current situation and all of the moving parts. The discussion is then expanded to include Fossil's 1Q16 earnings and management's commentary on the watch market. By looking at both Fossil (sells watches for many luxury brands) and the Swiss watchmakers, we end up with a complete view of the traditional watch market. We conclude with Apple Watch and a few good signs that have appeared for Apple's newest product category.
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