Apple had a few surprises for us this week. First was the announcement of OS X Mountain Lion, the second was CEO Tim Cook’s presentation at a Goldman Sachs conference. There were more, but Mac OS Ken’s Ken Ray had so much to say on these two topics that we just had to let him roll.
Surprise! It’s Mountain Lion
Sometimes it seems as if all of the Apple surprises are gone. We expect big sales numbers ahead of earnings reports. We expect new iPhones and iPads months before we get them. Software updates are seen from a mile off. Yep. The days of the Apple surprises seem to be long gone. Then Apple says it’s updating the Mac operating system in a few months.
That was surprising.
The Cupertino company sent out a press release this week saying, yup, we’re releasing the next big cat in a few months and releasing a developer version today — currently known now as Thursday.
I really figured we’d be done with the cat names. I was wrong.
Apple, on Thursday, released the first OS X Mountain Lion Developer Preview with Over 100 New Features, and no “Mac” at the front of it. For those of you who’ve already asked, OSKen.com is already taken, and not by me.
But I go wildly off topic.
Mountain Lion will be the ninth major OS X release and will be a bigger blend of the desktop and iOS worlds than Lion proved to be.
Quoting Apple’s press release, “Mountain Lion introduces Messages, Notes, Reminders and Game Center to the Mac, as well as Notification Center, Share Sheets, Twitter integration and AirPlay Mirroring.” And the piece says Mountain Lion is “the first OS X release built with iCloud in mind for easy setup and integration with apps.”
Also included: Gatekeeper, a feature the company says gives users control over which apps can be downloaded and installed on a Mac either letting people install them from any source they like, or allowing them to use the “default setting to install apps from the Mac App Store, along with apps from developers that have a unique Developer ID from Apple.”
“For maximum security,” says the release, “you can set Gatekeeper to only allow apps from the Mac App Store to be downloaded and installed.”
The walls. They are getting higher.
The Twitter integration is interesting. According to the press release, “Twitter is integrated throughout Mountain Lion so you can sign on once and tweet directly from Safari, Quick Look, Photo Booth, Preview and third party apps.”
The preview release of Mountain Lion became available to Mac Developer Program members on Thursday. It’s scheduled to be out to the general Mac using public by late summer of 2012.
It is so weird to have a big update just one year after another big update, though it may never seem weird again.
According to Wired, Apple is approaching OS X updates in two new ways from now on. For one, no big event to announce the next big update. Witness the lack of big event on Thursday. And two, a new update every year.
The company plans on updating its desktop software every year, from 10.8 to 10.9 until the innumerate future, just like it currently does with iOS. It’s an incremental approach to steadily add new features, rather than rethink the OS from scratch. Until, of course, Apple needs to rethink the OS from scratch again.
Whether Mountain Lion continues what some have called the iOSification of the Mac or starts what GigaOm’s Weldon Dodd refers to as the iCloudification of the whole system, The New York Times says the message of the update is clear: “If you’re going to buy one Apple product, you might as well keep buying more.”
“When users first start up Mountain Lion,” notes the piece, “they are asked to enter their iCloud credentials. This way, content like notes, messages and event reminders can be easily shared between multiple Apple devices.”
So make your notes where you wanna… they show up everywhere. Want to contact someone via iMessage? You no longer have to grab your phone to do it.
Gartner analyst Michael Gartenberg says Apple is thinking about “a world where the personal cloud is rapidly displacing the personal computer as the center of the consumer’s digital life.”
iCloudification of all of it.
Stephen Baker, VP of Industry Analysis at NPD Group says, “Consumers don’t like change and they don’t like uncertainty… When I, as the consumer, know that I can get a consistent experience across all my devices, it makes it much easier for me to buy products from that company since I know the learning curve will be short.”
Tim Cook: Speech Maker
Remember when Steve Jobs used to smack analysts silly for clinging to the share buyback or dividend idea? Smack them silly verbally I mean.
Those days are over. And Apple CEO Tim Cook is willing to consider the idea, or at least willing to be seen as considering the idea.
The Apple CEO spoke this week at the Goldman Sach’s Technology and Internet Conference. A conference that I’m guessing was named in 1996 since you could hardly have a technology conference today that did not involve the Internet.
But I digress.
The first question was not about Apple’s amazing pile of cash, but it was addressed and we’ll address it first so we can be done with it.
Speaking for Goldman, analyst Bill Shoppe who asked the CEO about Apple’s nearly $98 billion in cash. Saying that it had been used sparingly in the past, Shoppe wondered over Apple’s reluctance for dividends and share buybacks, and should a change be expected along those lines?
The CEO disagreed that Apple had used its cash sparingly, pointing out that they’d spent billions in the supply chain, billions on acquisitions — including purchases of intellectual property — they’d spent billions on retail. But yeah, they still have a lot.
“We’re judicious,” said Cook. “We’re deliberate. We spend our money like its our last penny.” He repeated his assertion that he was not religious about holding money, but they need to be deliberate and really think through what to do with cash.
He did acknowledge that they have more cash than they need to run the business on a daily basis, and they are actively discussing what to do with it.
No toga party, though. He actually said that. Too bad, really. $98 billion would buy a seriously stellar toga party.
Kind of neat that a financial firm didn’t lead with “show me the money.” Shoppe started off with a question about workers in the supply chain, giving Cook an opportunity to say how important workers are to the company, how important education opportunities are for those workers, how important it is to eliminate under-age workers from the supply chain, how important worker safety is, and how glad Apple is to be doing what it’s doing with the Fair Labor Association, which is inspecting the supply chain.
Speaking of worker rights and the supply chain, Cook said “We know people have a high expectation of Apple… We have an even higher expectation of ourselves.”
Remember how Apple sold a lot of iPhones last quarter? Yeah Tim Cook’s not so sure. 37 million is how many they sold, and 37 million is a big number; 17 million more than in any other quarter before. But it’s only 25 percent of smartphone market and only 10 percent of cellphone market, so while the numbers were big, the potential, he says, is “jaw dropping.”
“What we’re focusing on is the same things we’ve always focused on… making the world’s best product.” If they keep doing that then they should sell more iPhones.
How does Apple handle the high cost of iPhone in emerging markets, where retailers rather than carriers seem to rule the cellphone space?
CEO Cook says everybody wants the best product, not a cheap version of the best product. Go-to-market in the emerging world has to be addressed in a different way, though he does point out that Apple was sort of able to bend China to the way of the west with its Unicom partnership, at least in that case China became more of a subsidized market.
What’s the word on the Mac in emerging markets? Both the iPhone and the iPad are creating a halo effect for Apple’s computers, similar to the halo effect created in the west by the iPod back in the day.
To see evidence of that, Cook says in 2007 — the year before the iPhone was released internationally — revenue from all emerging markets, including China, other parts of Asia, South America, Eastern Europe, and so on totaled $1.4 billion. Last year, revenues in all of those areas totaled $22 billion.
And that, he says, is just the beginning.
Funny thing to me: TV talk. I read an article from someone that said Cook hinted during the presentation at a full-fledged Apple Television, but I think you’d have to have wanted to hear that to have heard that.
I, on the other hand, did not want to hear it. So maybe that’s why I didn’t.
Why is it still a hobby was Shoppe’s question.
While he made it clear he would not talk about future products, Cook said Apple calls Apple TV a hobby because they don’t want people to think they think its got iPhone, iPad, or iPod-sized potential.
Quoting the CEO,
Apple doesn’t do hobbies as a general rule. We believe in focus and only working on a few things. So, with Apple TV however, despite the barriers in that market, for those of us who use it, we’ve always thought there was something there. If we kept following our intuition and kept pulling the string, we might find something that was larger. For those people that have it right now, the customer satisfaction is off the chart. We need something that could go more main-market for it to be a serious category.
I didn’t hear him say full on Apple television in there, though I didn’t hear him say no full-on Apple television in there, either.
Cook is as into Siri and iCloud as was his predecessor saying that both are profound. iCloud is a strategy for next decade or more. Siri marks “another profound change in input,” along the lines of multi-touch before it and the mouse and keyboard before that.
He believes people today will talk to their grandkids about Siri and iCloud as profound changes.
And finally, CEO Cook was asked about what will define the Tim Cook era at Apple.
To this Cook replied, “Apple is this unique culture and unique company. You can’t replicate it. I’m not going to witness or permit the slow undoing of it. I believe in it so deeply.”
Steve grilled in all of us over many years, the company should revolve around great products. We should stay extremely focused on a few things, rather than try to do so many that we did nothing well. We should only go into markets where we can make a significant contribution to society, not just sell a lot of products. These things, along with keeping excellence as an expectation, these are the things that I focus on.
Those are the things that make Apple this magical place that really smart people want to work in, and do not just their life’s work, but their life’s best work.
“We’re always focused on the future,” wrapped Cook. “We don’t sit and think about how great things were yesterday. I love that trait, I think it’s the thing that drives us all forward. Those are the things that I’m holding on to and it’s a privilege to be a part of it.”
That was a much longer recap than I meant to do, and yet it was not everything. If you’d like to hear everything Apple has the presentation available online.