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Honestly, for anyone who watches Apple close enough, this isn't news. Its clear Apple are heading down the disruptive disintermediation route. Look at the Air

Honestly, for anyone who watches Apple close enough, this isn't news. Its clear Apple are heading down the disruptive disintermediation route. Look at the Air Tag. Effectively killing off competitors by making use of the global network of Apple devices. Look at their recent BNPL (buy now, pay later) announcement for example. Managing the whole caboodle, including the finance itself, entirely internally. Or look at the fact they still haven't rolled out Apple card internationally. My uninformed guess is that it is more to do with "something's brewing" rather than the US cards not working. Their recent satphone announcement. Clearly that's just the start. I think most people are guessing the endgame will be carrier disintermediation. And frankly, given how shit most cell carriers are, I can't wait for Apple to come along and give the incumbents a run for their money.

convolvatron 4y ago
why do you call it disintermediation? apple is still the big intermediate here
- mikeyouse 4y ago
  Intermediate to what? They own the software, hardware, and are moving toward owning the network and billing relationship.. Intermediate between consumers and app builders maybe, but as they build more features into their own devices (e.g. Apple Maps), even those relationships are being brought into the ecosystem.
- efaref 4y ago
  The real word here is "monopolisation".
  - arcticbull 4y ago
    A monopoly would require they control the entire market for a given product or service. Apple isn't a monopoly in any area - but they are a strong competitor in many areas. They're more like a western take on a chaebol [1] in my opinion. [1] https://en.wikipedia.org/wiki/Chaebol https://en.wikipedia.org/wiki/Chaebol
    - lr1970 4y ago
      > Apple isn't a monopoly in any area - but they are a strong competitor in many areas. New term: "Vertical Monopoly"
- traceroute66 4y ago
  > why do you call it disintermediation? Because Apple want to control the quality of the user experience. Right now Apple Hardware and Apple Software are tightly interlinked. Apple can do things in software because they design 100% of the hardware, and vice-versa. There's a lot of stuff Apple do in terms of quality of experience that's only possible because of that tight integration. Stuff that would be impossible to do with generic hardware and generic software. But equally Apple know that if you buy an iPhone, you are dependent on a carrier for service. Like the rest of the world, it has probably not escaped Apple's attention that the quality of service you get from the carriers is becoming rapidly worse by the day. As a result, an Apple user's poor experience with an iPhone might have nothing to do with Apple but everything to do with the carrier. Having carrier level integration with iPhone could also open up further user experience improvements (e.g. maybe they could do clever stuff at carrier level to help preserve battery).
  - turndown 4y ago
    As I sit here on an iPad Pro that refused to correctly highlight and copy a piece of your post so I could directly reply to it, I just want you to know that nobody views the whole “Apple can do unique things because they own the hardware/software stack” in a positive light. Apple is very bad at software and I will always stand by that… it is very sad that such nice pieces of hardware are married to some of the worst software.
    - caned 4y ago
      Subjective, but I'll second this as an Apple user - at least for iOS devices. I mostly like the design, but I'm appalled at how glitchy the interface controls are, for one. And it has been consistently so for years. Don't even get me started on the Apple TV. I've never been able to reliably use the remote (physical or app).
  - lotsofpulp 4y ago
    > Like the rest of the world, it has probably not escaped Apple's attention that the quality of service you get from the carriers is becoming rapidly worse by the day. In my experience, mobile connectivity just keeps getting better and better. I have lived on both US coasts and traveled to multiple developing countries, and even in places like Zimbabwe I had pretty great connectivity considering where I was.
gnicholas 4y ago
Their new weather forecasting service is also intriguing. They will soon have millions of thermometer-equipped Apple Watches in the world (IIRC the Series 8 and AWU will have these), allowing them to create an incredibly detailed mapping of temperatures around the world (or at least places where people can afford expensive watches...).
- anamexis 4y ago
  Wouldn't they only be able to make a detailed mapping of the temperatures of people's wrists?
  - traceroute66 4y ago
    > Wouldn't they only be able to make a detailed mapping of the temperatures of people's wrists? Unless you're sick, most people's body temperature is within a fairly tight range. So they could compensate for that ...
    - anamexis 4y ago
      Is there any correlation between your body temperature and the outdoor temperature?
      - egman_ekki 4y ago
        Depends on if you're a lizard or a bird :)
  - gnicholas 4y ago
    It would be hilarious: the temperature worldwide is roughly 98.6° F, except in NYC where the marathon is being run and it is somewhat warmer. /s
    - traceroute66 4y ago
      > except in NYC Or, ahem.... "cold winter evenings". ;-)
arcticbull 4y ago
> Look at their recent BNPL (buy now, pay later) announcement for example. Managing the whole caboodle, including the finance itself, entirely internally. For what it's worth I think BNPL is simply an attempt by Apple to get some yield on their insane cash pile. Last year they had over $0.2T on hand. [1] They're making it faster than they seem to be able to return it to shareholders. BNPL is a pretty bad business - margins are low, buyers are generally not qualified in the same way as other lending, ticket sizes are low, and collections aren't worth it (you really gonna repossess my $20 gently-used socks?). However, if Apple has a better way to qualify the customers (a big if)... They can take ~3-4% of the transaction, net like 0.5% for a 6 week loan, which is like a 4.5% APR. Their margins may be better than peers since they can use their own cash instead of raising debt. Maybe 6-7% APR. It's also short-term debt that turns over fast so it's highly liquid. My wholly uninformed opinion is that this is more of a cash management product that happens to be built on their data for Apple than a data product per se. After all you can't just roll up at BofA with a $0.2T check and get that kind of APR. [1] https://www.investors.com/etfs-and-funds/sectors/sp500-every-american-apple-has-more-cash-than-anyone/ https://www.investors.com/etfs-and-funds/sectors/sp500-every...
- pwinnski 4y ago
  > They can take ~3-4% of the transaction, net like 0.5% for a 6 week loan, which is like a 4.5% APR. Their margins may be better than peers since they can use their own cash instead of raising debt. Maybe 6-7% APR. It's also short-term debt that turns over fast so it's highly liquid. Apple has said they'll be charging zero interest and zero fees for this service, including zero late fees, so where the yield will be coming from is unclear. That said, I confess that I don't have a deep understanding of the BNPL market.
  - whatshisface 4y ago
    If they don't collect from buyers, they can collect from sellers. If you look back to when credit cards were new, you had them making shops agree not to charge credit card users more, despite the fees. That put cash users at a newfound disadvantage, and shops had to put up with it because card users were numerous enough.
onlyrealcuzzo 4y ago
> And frankly, given how shit most cell carriers are, I can't wait for Apple to come along and give the incumbents a run for their money. Why would the most profitable company in the world want to get into one of the worst businesses in the world? It's absurdly capital intensive. Sure, Apple has an abundance of capital, but their shareholders are unlikely to approve this over ever more share buybacks...
- SkyMarshal 4y ago
  Loss leader, maybe. Traditionally not Apple’s style, but if they are indeed changing up their business model, then who knows.
- traceroute66 4y ago
  > one of the worst businesses in the world But is mobile telecoms really one of the worst businesses in the world ? I would argue that its one of the worst executed businesses in the world, but not the worst business. Travel and hospitality would likely be fairer examples of "worst businesses", perhaps especially the airline business.
  - Spooky23 4y ago
    People say this because accountants don’t like capital spending. Carriers have 50-60% gross margins. They are critical enough to get special tax treatments to deal with the capital expenses. If the goal is to make money, what would be the “best” business? Drug cartel?
    - traceroute66 4y ago
      > Carriers have 50-60% gross margins Indeed. Many people don't realise how amazingly robust margins have remained. A lot of it is because its such a closed shop which is why they can get away with many things.
    - specialist 4y ago
      Having done some contracting work for telecoms (seen how some of the sausage is made)... My hunch is they print pallets of cash, then use some large fraction for bonfires.
packetlost 4y ago
Apple is really uniquely positions to just decide to make a (crypto)currency. Push the app to every iPhone, give everyone with an Apple device X amount, and strong support for business + peer-to-peer transactions and you have the best easiest path to mass adoption possible.
- dehrmann 4y ago
  You're falling for the standard crypto trap of being a solution in search of a problem. The user experience you're describing is Venmo. Making it use CookCoin instead of USD doesn't make it easier to build, and it isn't really a selling point.
  - packetlost 4y ago
    What I'm describing is Venmo + Square. Neither of those 2 things completely implement what I'm describing on their own. Regardless, I didn't say that it had to be crypto. My entire point was they have a the easiest path of any company to critical mass adoption of a service because they directly control the software of half the phones in the US.
    - CharlesW 4y ago
      How is what you want different than Apple Cash?
SnowingXIV 4y ago
This would be an absolute dream, dealing with carriers has been hell since the beginning. I often do upgrade my phone, but it's been a huge hassle. Sometimes the promos don't work well and they basically wrap you into a contract anyways. I'm honestly just going to pay extra cash and upgrade directly through Apple even though the carrier offers a bigger credit. If I could cut them out all together and buy an iPhone and cell service with Apple. Done.
- lm28469 4y ago
  > dealing with carriers has been hell since the beginning. Are you American by any chance ? This has been solves in other places through regulations
  - CodeSgt 4y ago
    No it hasn't. There wasn't a specific grevience listed so you really dont know if European regulations have solved it or not. I'm an American but have spent years living in Europe and dealing with carriers there has its own frustrations. These sorts of comments are common but always strike me as having been made by someone with little to no real world experience on the specific issue being discussed.
    - traceroute66 4y ago
      > you really dont know if European regulations have solved it or not Ask anybody who has lived in the UK long enough about Vodafone. The story normally goes something like this: - 90s = Dogs bollocks, nobody came close - 00s = Started to smell a bit, but still the most robust technical service - early 10s = Really starting to rest on their laurels now - late 10s – today = Shit, godawful shit.
    - lm28469 4y ago
      > with little to no real world experience on the specific issue being discussed. I lived in France and now I'm in Germany, still using my French sim card, for no additional cost. I can change carriers whenever I want with no delay and transfer my number to the new carrier, all of that for much cheaper than what was available in the US when I was living there. No contract, no hidden fees, no loops to jump through to cancel a subscription, it just works. I really don't see what one more monopoly would solve. Feel free to publish your list of grievances, I suspect they're extremely out of the ordinary
Hamcha 4y ago
Competition is great, especially when it breaks oligopolies, I just hope stuff like the Digital Markets Act will manage to stop them from abusing their positions to make their solution a monopoly
- guywithahat 4y ago
  Kind of like how the only thing net neutrality did was prevent t-mobile from creating Netflix unlimited fast lanes? Or how all those bills states signed into law to encourage high speed networks not only didn't create high speed networks, but legally preventing other companies from competing? The more this gets legislated the harder it will be for someone to enter the market later on, Apple (among other tech giants) aren't going to sit back while you write the laws, it'll be the other way around.
  - dsr_ 4y ago
    "the only thing {the threat of} net neutrality" Note that net neutrality has never been passed as a Federal regulation.
Melatonic 4y ago
We are going to see satphone use on most handsets I think fairly soon (starting with low badwith options). The idea of Apple operating their own carrier is interesting but also sort of terrifying - they are already all about keeping everything in their own ecosystem and making interoperability with other brands a huge PIA - are we going to see the day when Apple devices intentionally barely function with other carriers / brands / OS?
lupire 4y ago
Watching close enough? This has been Appple's business model and advertising for decades: your digital lifestyle hardware and software solution.
8fingerlouie 4y ago
> Look at their recent BNPL (buy now, pay later) announcement for example. Managing the whole caboodle, including the finance itself, entirely internally. Isn't that just tax evasion and/or "investment" in a time with negative interest ? > Or look at the fact they still haven't rolled out Apple card internationally. My uninformed guess is that it is more to do with "something's brewing" rather than the US cards not working. Banking and credit card operations are some of the most regulated businesses in the world, and financial authorities have different requirements from country to country, which would make it prohibitively expensive to roll out on a global scale.

convolvatron 4y ago

why do you call it disintermediation? apple is still the big intermediate here

mikeyouse 4y ago
Intermediate to what? They own the software, hardware, and are moving toward owning the network and billing relationship.. Intermediate between consumers and app builders maybe, but as they build more features into their own devices (e.g. Apple Maps), even those relationships are being brought into the ecosystem.
efaref 4y ago
The real word here is "monopolisation".
- arcticbull 4y ago
  A monopoly would require they control the entire market for a given product or service. Apple isn't a monopoly in any area - but they are a strong competitor in many areas. They're more like a western take on a chaebol [1] in my opinion. [1] https://en.wikipedia.org/wiki/Chaebol https://en.wikipedia.org/wiki/Chaebol
  - lr1970 4y ago
    > Apple isn't a monopoly in any area - but they are a strong competitor in many areas. New term: "Vertical Monopoly"
traceroute66 4y ago
> why do you call it disintermediation? Because Apple want to control the quality of the user experience. Right now Apple Hardware and Apple Software are tightly interlinked. Apple can do things in software because they design 100% of the hardware, and vice-versa. There's a lot of stuff Apple do in terms of quality of experience that's only possible because of that tight integration. Stuff that would be impossible to do with generic hardware and generic software. But equally Apple know that if you buy an iPhone, you are dependent on a carrier for service. Like the rest of the world, it has probably not escaped Apple's attention that the quality of service you get from the carriers is becoming rapidly worse by the day. As a result, an Apple user's poor experience with an iPhone might have nothing to do with Apple but everything to do with the carrier. Having carrier level integration with iPhone could also open up further user experience improvements (e.g. maybe they could do clever stuff at carrier level to help preserve battery).
- turndown 4y ago
  As I sit here on an iPad Pro that refused to correctly highlight and copy a piece of your post so I could directly reply to it, I just want you to know that nobody views the whole “Apple can do unique things because they own the hardware/software stack” in a positive light. Apple is very bad at software and I will always stand by that… it is very sad that such nice pieces of hardware are married to some of the worst software.
  - caned 4y ago
    Subjective, but I'll second this as an Apple user - at least for iOS devices. I mostly like the design, but I'm appalled at how glitchy the interface controls are, for one. And it has been consistently so for years. Don't even get me started on the Apple TV. I've never been able to reliably use the remote (physical or app).
- lotsofpulp 4y ago
  > Like the rest of the world, it has probably not escaped Apple's attention that the quality of service you get from the carriers is becoming rapidly worse by the day. In my experience, mobile connectivity just keeps getting better and better. I have lived on both US coasts and traveled to multiple developing countries, and even in places like Zimbabwe I had pretty great connectivity considering where I was.

gnicholas 4y ago

Their new weather forecasting service is also intriguing. They will soon have millions of thermometer-equipped Apple Watches in the world (IIRC the Series 8 and AWU will have these), allowing them to create an incredibly detailed mapping of temperatures around the world (or at least places where people can afford expensive watches...).

anamexis 4y ago
Wouldn't they only be able to make a detailed mapping of the temperatures of people's wrists?
- traceroute66 4y ago
  > Wouldn't they only be able to make a detailed mapping of the temperatures of people's wrists? Unless you're sick, most people's body temperature is within a fairly tight range. So they could compensate for that ...
  - anamexis 4y ago
    Is there any correlation between your body temperature and the outdoor temperature?
    - egman_ekki 4y ago
      Depends on if you're a lizard or a bird :)
- gnicholas 4y ago
  It would be hilarious: the temperature worldwide is roughly 98.6° F, except in NYC where the marathon is being run and it is somewhat warmer. /s
  - traceroute66 4y ago
    > except in NYC Or, ahem.... "cold winter evenings". ;-)

arcticbull 4y ago

> Look at their recent BNPL (buy now, pay later) announcement for example. Managing the whole caboodle, including the finance itself, entirely internally. For what it's worth I think BNPL is simply an attempt by Apple to get some yield on their insane cash pile. Last year they had over $0.2T on hand. [1] They're making it faster than they seem to be able to return it to shareholders. BNPL is a pretty bad business - margins are low, buyers are generally not qualified in the same way as other lending, ticket sizes are low, and collections aren't worth it (you really gonna repossess my $20 gently-used socks?). However, if Apple has a better way to qualify the customers (a big if)... They can take ~3-4% of the transaction, net like 0.5% for a 6 week loan, which is like a 4.5% APR. Their margins may be better than peers since they can use their own cash instead of raising debt. Maybe 6-7% APR. It's also short-term debt that turns over fast so it's highly liquid. My wholly uninformed opinion is that this is more of a cash management product that happens to be built on their data for Apple than a data product per se. After all you can't just roll up at BofA with a $0.2T check and get that kind of APR. [1] https://www.investors.com/etfs-and-funds/sectors/sp500-every-american-apple-has-more-cash-than-anyone/ https://www.investors.com/etfs-and-funds/sectors/sp500-every...

pwinnski 4y ago
> They can take ~3-4% of the transaction, net like 0.5% for a 6 week loan, which is like a 4.5% APR. Their margins may be better than peers since they can use their own cash instead of raising debt. Maybe 6-7% APR. It's also short-term debt that turns over fast so it's highly liquid. Apple has said they'll be charging zero interest and zero fees for this service, including zero late fees, so where the yield will be coming from is unclear. That said, I confess that I don't have a deep understanding of the BNPL market.
- whatshisface 4y ago
  If they don't collect from buyers, they can collect from sellers. If you look back to when credit cards were new, you had them making shops agree not to charge credit card users more, despite the fees. That put cash users at a newfound disadvantage, and shops had to put up with it because card users were numerous enough.

onlyrealcuzzo 4y ago

> And frankly, given how shit most cell carriers are, I can't wait for Apple to come along and give the incumbents a run for their money. Why would the most profitable company in the world want to get into one of the worst businesses in the world? It's absurdly capital intensive. Sure, Apple has an abundance of capital, but their shareholders are unlikely to approve this over ever more share buybacks...

SkyMarshal 4y ago
Loss leader, maybe. Traditionally not Apple’s style, but if they are indeed changing up their business model, then who knows.
traceroute66 4y ago
> one of the worst businesses in the world But is mobile telecoms really one of the worst businesses in the world ? I would argue that its one of the worst executed businesses in the world, but not the worst business. Travel and hospitality would likely be fairer examples of "worst businesses", perhaps especially the airline business.
- Spooky23 4y ago
  People say this because accountants don’t like capital spending. Carriers have 50-60% gross margins. They are critical enough to get special tax treatments to deal with the capital expenses. If the goal is to make money, what would be the “best” business? Drug cartel?
  - traceroute66 4y ago
    > Carriers have 50-60% gross margins Indeed. Many people don't realise how amazingly robust margins have remained. A lot of it is because its such a closed shop which is why they can get away with many things.
  - specialist 4y ago
    Having done some contracting work for telecoms (seen how some of the sausage is made)... My hunch is they print pallets of cash, then use some large fraction for bonfires.

packetlost 4y ago

Apple is really uniquely positions to just decide to make a (crypto)currency. Push the app to every iPhone, give everyone with an Apple device X amount, and strong support for business + peer-to-peer transactions and you have the best easiest path to mass adoption possible.

dehrmann 4y ago
You're falling for the standard crypto trap of being a solution in search of a problem. The user experience you're describing is Venmo. Making it use CookCoin instead of USD doesn't make it easier to build, and it isn't really a selling point.
- packetlost 4y ago
  What I'm describing is Venmo + Square. Neither of those 2 things completely implement what I'm describing on their own. Regardless, I didn't say that it had to be crypto. My entire point was they have a the easiest path of any company to critical mass adoption of a service because they directly control the software of half the phones in the US.
  - CharlesW 4y ago
    How is what you want different than Apple Cash?

SnowingXIV 4y ago

This would be an absolute dream, dealing with carriers has been hell since the beginning. I often do upgrade my phone, but it's been a huge hassle. Sometimes the promos don't work well and they basically wrap you into a contract anyways. I'm honestly just going to pay extra cash and upgrade directly through Apple even though the carrier offers a bigger credit. If I could cut them out all together and buy an iPhone and cell service with Apple. Done.

lm28469 4y ago
> dealing with carriers has been hell since the beginning. Are you American by any chance ? This has been solves in other places through regulations
- CodeSgt 4y ago
  No it hasn't. There wasn't a specific grevience listed so you really dont know if European regulations have solved it or not. I'm an American but have spent years living in Europe and dealing with carriers there has its own frustrations. These sorts of comments are common but always strike me as having been made by someone with little to no real world experience on the specific issue being discussed.
  - traceroute66 4y ago
    > you really dont know if European regulations have solved it or not Ask anybody who has lived in the UK long enough about Vodafone. The story normally goes something like this: - 90s = Dogs bollocks, nobody came close - 00s = Started to smell a bit, but still the most robust technical service - early 10s = Really starting to rest on their laurels now - late 10s – today = Shit, godawful shit.
  - lm28469 4y ago
    > with little to no real world experience on the specific issue being discussed. I lived in France and now I'm in Germany, still using my French sim card, for no additional cost. I can change carriers whenever I want with no delay and transfer my number to the new carrier, all of that for much cheaper than what was available in the US when I was living there. No contract, no hidden fees, no loops to jump through to cancel a subscription, it just works. I really don't see what one more monopoly would solve. Feel free to publish your list of grievances, I suspect they're extremely out of the ordinary

Hamcha 4y ago

Competition is great, especially when it breaks oligopolies, I just hope stuff like the Digital Markets Act will manage to stop them from abusing their positions to make their solution a monopoly

guywithahat 4y ago
Kind of like how the only thing net neutrality did was prevent t-mobile from creating Netflix unlimited fast lanes? Or how all those bills states signed into law to encourage high speed networks not only didn't create high speed networks, but legally preventing other companies from competing? The more this gets legislated the harder it will be for someone to enter the market later on, Apple (among other tech giants) aren't going to sit back while you write the laws, it'll be the other way around.
- dsr_ 4y ago
  "the only thing {the threat of} net neutrality" Note that net neutrality has never been passed as a Federal regulation.

Melatonic 4y ago

We are going to see satphone use on most handsets I think fairly soon (starting with low badwith options). The idea of Apple operating their own carrier is interesting but also sort of terrifying - they are already all about keeping everything in their own ecosystem and making interoperability with other brands a huge PIA - are we going to see the day when Apple devices intentionally barely function with other carriers / brands / OS?

lupire 4y ago

Watching close enough? This has been Appple's business model and advertising for decades: your digital lifestyle hardware and software solution.

8fingerlouie 4y ago

> Look at their recent BNPL (buy now, pay later) announcement for example. Managing the whole caboodle, including the finance itself, entirely internally. Isn't that just tax evasion and/or "investment" in a time with negative interest ? > Or look at the fact they still haven't rolled out Apple card internationally. My uninformed guess is that it is more to do with "something's brewing" rather than the US cards not working. Banking and credit card operations are some of the most regulated businesses in the world, and financial authorities have different requirements from country to country, which would make it prohibitively expensive to roll out on a global scale.