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I think this was actually a surprisingly weak showcase from Apple. Something in the TV space with a bit of bite at Netflix would have shown confidence in themse

by AJRF 8y ago

I think this was actually a surprisingly weak showcase from Apple. Something in the TV space with a bit of bite at Netflix would have shown confidence in themselves, a new avenue for creativity that consumers are so engrossed with (i.e new Netflix shows and films are in themselves, events. People talk about the newest Netflix show like a new product release). Instead they showed a credit card, that look's nice, but I fail to see how Ben think's that reduces churn (credit cards aren't sticky, incentives are - no one will buy a new phone because they're middle of the road rewards are there) and then a subscription that would have been a footnote in a Google or Samsung keynote. Those subscriptions for news (and even more so for Games) are non-events. They are so boring, so anti-sticky that they made me think this whole thing was actually a failure - and Apple shouldn't have made a song and dance of it and just talked about during the iPhone keynote.

b_tterc_p 8y ago
The card is probably a good idea. No fee, simplicity, and convenience are good for the consumer. Only selling to Apple product users means a certain band of wealth and thereby lower default rates are implicitly targeted. It’s a good deal for both, especially for consumers who wouldn’t normally spend enough to earn something noteworthy or even positive against the card fee on better cards. News is also a pretty good deal if you like news... but yes, both are really boring. It seems like something interesting to apple investors, but not consumers. The games platform sounds both boring AND unlikely to do well
- kristianc 8y ago
  > The card is probably a good idea. No fee, simplicity, and convenience are good for the consumer. Only selling to Apple product users means a certain band of wealth and thereby lower default rates are implicitly targeted. The strategy may work in the US where the payments ecosystem is incredibly dated and backwards, but Apple Card is very much a me-too offering in nearly every other developed economy.
  - servercobra 8y ago
    They have around 100 million iPhone users in the US, so that seems like a very reasonable market to target, even if no one outside the US ever uses it.
- tonyedgecombe 8y ago
  >The games platform sounds both boring AND unlikely to do well I'm not sure, the whole in-app purchase thing is a bit of a mess. I could imagine parents subscribing just to keep their kids out of that cesspit.
  - kristianc 8y ago
    > I could imagine parents subscribing just to keep their kids out of that cesspit. I can see parents resenting subscribing just to keep their kids out of that cesspit.
  - doctorpangloss 8y ago
    Apple hasn’t cared about games for a long time, and it hasn’t really started caring now. For example, virtual slot machines, which make up something like 9% of the top grossing charts, are the biggest IAP offenders. They’re bad for gaming, they’re like the virus of the industry. If Apple wanted to, it could just remove them from the store in an afternoon. The platforms that don’t run virtual slot machines tend to host the biggest achievements in gaming critically and financially. That would appear to be, in a narrow and uninteresting way, the Epic Games Launcher, or the PlayStation store hosting GTA. How does Apple have the store for devices as powerful as and more numerous than the Switch, and yet can’t host more than a few critical and financial successes a year? It’s the culture, duh. It’s not the business model. That’s why subscriptions are kind of stupid.
  - hizanberg 8y ago
    I’m definitely one of them, I refuse to play any IAP games as I view them as a Trojan virus social engineering experiment (masquerading as a game) designed to trick you into maximizing their IAP revenue. An IAP-free game subscription is exactly what I’m looking for and the only thing I’ll be letting my kids play when they come of age.
  - b_tterc_p 8y ago
    Is it confirmed that Apple will forbid in app purchases? Because otherwise I wouldn’t see any reason to expect this.
scarface74 8y ago
Instead they showed a credit card, that look's nice, but I fail to see how Ben think's that reduces churn (credit cards aren't sticky, incentives are - no one will buy a new phone because they're middle of the road rewards are there) You just contradicted yourself. “Stickiness” by definition is not about people getting “new” phones it’s about people staying in the ecosystem and spending more. The whole idea behind services is to get people spending more money in the ecosystem since they aren’t buying new phones as frequently. The credit card is basically useless without the phone. If you track your spending with the phone, you’re less likely to leave and you get simple cash back with it that goes into your Apple Pay account. Subscriptions for games are really a big deal. The whole ecosystem for games is slimy with ads and in app purchases of gems and loot boxes. Games that are bundle with the subscription are curated. If you have kids, signing up for a games subscription and handing them a new $329 iPad or hand me down iPhone is a no brainer. AppleTV+ won’t be a big deal, but get a subscription to Disney+ when it comes out and you have the perfect item to keep them busy. I would get Apple News just for one of two magazines that I care about.
- nojvek 8y ago
  I’m not sure how I feel with an entire generation of kids mindlessly glued to their devices. When I go to restaurants, I genuinely praise every parent that doesn’t have their kids glued to their ipads/phones (which is rare)
  - scarface74 8y ago
    You mean like generations past who had iPods, Walkmen, Gameboys and portable DVD players? People have been complaining about kids and their electronics since the Atari 2600.
    - robotresearcher 8y ago
      Did time begin in 1980? Previously our parents debated if it was ok for kids to read books at the table. I bet Aristotle complained about kid’s focus of attention these days.
et2o 8y ago
The apple card is sticky because earning 2% cash back with it requires the use of Apple Pay.
- graeme 8y ago
  I think this is an interesting double strategy with the card: apple now will have a small army of customers asking stores “do you support apple pay? Do you support apple pay?” This will drive adoption. (For those who haven’t been to the US: unlike the rest of the developed work, contactless payment isn’t universal in America. Many places still require you to swipe and sign. Even chip readers are somewhat new. So this card is a way of pushing merchants to modernize their systems and support contactless. Users get 1% for card use but 2% for apple pay) Edit: why is this getting downvoted? It seems obviously correct. Apple has been struggling to push us apple pay acceptance for years.
  - screye 8y ago
    > Users get 1% for card use but 2% for apple pay 2% cash back on cards is quite common. Especially if you earn enough to be deeply invested in the Apple ecosystem.
    - graeme 8y ago
      For sure. It’s not an amazing card from a cashback perspective. But, many people will get this card regardless (for convenience, for the privscy, for the analytics, etc). And they will have an incentive to ask stores about apple pay: double cashback. That’s my point. Apple will be passively mobilizing these people to spread contactless acceptance.
kwindla 8y ago
It seems that the credit card was designed to tie into Apple's existing payments systems to both reduce processing fees that Apple pays and to be sticky. The card pays cash back daily as dollars that are immediately available for use with Apple Pay. Apple can then prompt you to pay for Apps, Apple Music, and Apple hardware using these funds. That makes the stuff you buy from Apple feel "free" (you're paying for it with magic cash-back dollars). It also means that processing your payment just requires changing a number in an Apple database, not routing money through the credit card processing network. I'm sure I've gotten some of the details wrong. The top comment here goes into a lot more (somewhat speculative) detail: https://www.quora.com/What-is-Apple-Card-the-new-credit-card-from-Apple-and-why-is-it-important https://www.quora.com/What-is-Apple-Card-the-new-credit-card...
013a 8y ago
Those subscriptions would have been footnotes in a Google event; that's why Apple is different. When Google enters a market with a new product, most of the time it's a half-assed play by some middle manager to get a promotion. When Apple does something, they put Force behind it to make it successful. Generally. Google Play Music wasn't a thing Google cared about, really. Same with Youtube Music. Neither of them achieved much success. Apple Music now has more US subscribers than Spotify. They care about it because they make it their business to care about it. Customers see that. They give Apple money. Its that simple.
whywhywhywhy 8y ago
Apple could never compete with Netflix without a serious rethink of their brand values. To have truly good TV people need to be able to tell stories about awful things as well as good things. You'll never get something like The Wire coming out of Apple because it makes the current execs feel uneasy. You will however get safe milquetoast things like Carpool Karaoke.

by AJRF 8y ago

b_tterc_p 8y ago

The card is probably a good idea. No fee, simplicity, and convenience are good for the consumer. Only selling to Apple product users means a certain band of wealth and thereby lower default rates are implicitly targeted. It’s a good deal for both, especially for consumers who wouldn’t normally spend enough to earn something noteworthy or even positive against the card fee on better cards. News is also a pretty good deal if you like news... but yes, both are really boring. It seems like something interesting to apple investors, but not consumers. The games platform sounds both boring AND unlikely to do well

kristianc 8y ago
> The card is probably a good idea. No fee, simplicity, and convenience are good for the consumer. Only selling to Apple product users means a certain band of wealth and thereby lower default rates are implicitly targeted. The strategy may work in the US where the payments ecosystem is incredibly dated and backwards, but Apple Card is very much a me-too offering in nearly every other developed economy.
- servercobra 8y ago
  They have around 100 million iPhone users in the US, so that seems like a very reasonable market to target, even if no one outside the US ever uses it.
tonyedgecombe 8y ago
>The games platform sounds both boring AND unlikely to do well I'm not sure, the whole in-app purchase thing is a bit of a mess. I could imagine parents subscribing just to keep their kids out of that cesspit.
- kristianc 8y ago
  > I could imagine parents subscribing just to keep their kids out of that cesspit. I can see parents resenting subscribing just to keep their kids out of that cesspit.
- doctorpangloss 8y ago
  Apple hasn’t cared about games for a long time, and it hasn’t really started caring now. For example, virtual slot machines, which make up something like 9% of the top grossing charts, are the biggest IAP offenders. They’re bad for gaming, they’re like the virus of the industry. If Apple wanted to, it could just remove them from the store in an afternoon. The platforms that don’t run virtual slot machines tend to host the biggest achievements in gaming critically and financially. That would appear to be, in a narrow and uninteresting way, the Epic Games Launcher, or the PlayStation store hosting GTA. How does Apple have the store for devices as powerful as and more numerous than the Switch, and yet can’t host more than a few critical and financial successes a year? It’s the culture, duh. It’s not the business model. That’s why subscriptions are kind of stupid.
- hizanberg 8y ago
  I’m definitely one of them, I refuse to play any IAP games as I view them as a Trojan virus social engineering experiment (masquerading as a game) designed to trick you into maximizing their IAP revenue. An IAP-free game subscription is exactly what I’m looking for and the only thing I’ll be letting my kids play when they come of age.
- b_tterc_p 8y ago
  Is it confirmed that Apple will forbid in app purchases? Because otherwise I wouldn’t see any reason to expect this.

scarface74 8y ago

Instead they showed a credit card, that look's nice, but I fail to see how Ben think's that reduces churn (credit cards aren't sticky, incentives are - no one will buy a new phone because they're middle of the road rewards are there) You just contradicted yourself. “Stickiness” by definition is not about people getting “new” phones it’s about people staying in the ecosystem and spending more. The whole idea behind services is to get people spending more money in the ecosystem since they aren’t buying new phones as frequently. The credit card is basically useless without the phone. If you track your spending with the phone, you’re less likely to leave and you get simple cash back with it that goes into your Apple Pay account. Subscriptions for games are really a big deal. The whole ecosystem for games is slimy with ads and in app purchases of gems and loot boxes. Games that are bundle with the subscription are curated. If you have kids, signing up for a games subscription and handing them a new $329 iPad or hand me down iPhone is a no brainer. AppleTV+ won’t be a big deal, but get a subscription to Disney+ when it comes out and you have the perfect item to keep them busy. I would get Apple News just for one of two magazines that I care about.

nojvek 8y ago
I’m not sure how I feel with an entire generation of kids mindlessly glued to their devices. When I go to restaurants, I genuinely praise every parent that doesn’t have their kids glued to their ipads/phones (which is rare)
- scarface74 8y ago
  You mean like generations past who had iPods, Walkmen, Gameboys and portable DVD players? People have been complaining about kids and their electronics since the Atari 2600.
  - robotresearcher 8y ago
    Did time begin in 1980? Previously our parents debated if it was ok for kids to read books at the table. I bet Aristotle complained about kid’s focus of attention these days.

et2o 8y ago

The apple card is sticky because earning 2% cash back with it requires the use of Apple Pay.

graeme 8y ago
I think this is an interesting double strategy with the card: apple now will have a small army of customers asking stores “do you support apple pay? Do you support apple pay?” This will drive adoption. (For those who haven’t been to the US: unlike the rest of the developed work, contactless payment isn’t universal in America. Many places still require you to swipe and sign. Even chip readers are somewhat new. So this card is a way of pushing merchants to modernize their systems and support contactless. Users get 1% for card use but 2% for apple pay) Edit: why is this getting downvoted? It seems obviously correct. Apple has been struggling to push us apple pay acceptance for years.
- screye 8y ago
  > Users get 1% for card use but 2% for apple pay 2% cash back on cards is quite common. Especially if you earn enough to be deeply invested in the Apple ecosystem.
  - graeme 8y ago
    For sure. It’s not an amazing card from a cashback perspective. But, many people will get this card regardless (for convenience, for the privscy, for the analytics, etc). And they will have an incentive to ask stores about apple pay: double cashback. That’s my point. Apple will be passively mobilizing these people to spread contactless acceptance.

kwindla 8y ago

It seems that the credit card was designed to tie into Apple's existing payments systems to both reduce processing fees that Apple pays and to be sticky. The card pays cash back daily as dollars that are immediately available for use with Apple Pay. Apple can then prompt you to pay for Apps, Apple Music, and Apple hardware using these funds. That makes the stuff you buy from Apple feel "free" (you're paying for it with magic cash-back dollars). It also means that processing your payment just requires changing a number in an Apple database, not routing money through the credit card processing network. I'm sure I've gotten some of the details wrong. The top comment here goes into a lot more (somewhat speculative) detail: https://www.quora.com/What-is-Apple-Card-the-new-credit-card-from-Apple-and-why-is-it-important https://www.quora.com/What-is-Apple-Card-the-new-credit-card...

013a 8y ago

Those subscriptions would have been footnotes in a Google event; that's why Apple is different. When Google enters a market with a new product, most of the time it's a half-assed play by some middle manager to get a promotion. When Apple does something, they put Force behind it to make it successful. Generally. Google Play Music wasn't a thing Google cared about, really. Same with Youtube Music. Neither of them achieved much success. Apple Music now has more US subscribers than Spotify. They care about it because they make it their business to care about it. Customers see that. They give Apple money. Its that simple.

whywhywhywhy 8y ago

Apple could never compete with Netflix without a serious rethink of their brand values. To have truly good TV people need to be able to tell stories about awful things as well as good things. You'll never get something like The Wire coming out of Apple because it makes the current execs feel uneasy. You will however get safe milquetoast things like Carpool Karaoke.