Renowned analyst: Why are your Apple devices becoming more and more uncomfortable?


Shen Translation Bureau is a compilation team of 36 氪. It focuses on technology, business, workplace, life and other fields, and focuses on introducing new foreign technologies, new perspectives and new trends.Editor’s note: Apple products such as iPhone and Mac have always been better known for user experience, thanks to Apple’s software and hardware integration.But such integration has also caused a lot of problems, such as the recent iOS 13 system, which has caused a lot of bugs; for example, the Mac’s butterfly keyboard problem has not been resolved until now; such as the App Store control and so on.For the entire ecosystem, for the entire user experience, it has caused many negative effects.Where’s that Apple pursuit of user experience?What happened in the middle?Recently, the famous analyst Ben Thompson analyzed the changes behind this, there is a feeling of “the dragon-slaying boy finally turned into a evil dragon”, the original title of the article is “Integration and Monopoly”, compiled by 36 氪 神 译 局, hopeCan inspire you.When I started Stratechery’s blog in 2013, there was a conventional wisdom that a modular ecosystem was the best.After all, for the past 30 years, Microsoft has dominated the technology industry, dominated the operating system layer, and benefited from other competitors.Of course, Microsoft’s dominance is declining right now, but not because this model doesn’t work: it is the inevitable winner of the smartphone era that will be Google, whose Android operating system follows the Windows script and comes with a lot of appealFree features.But it did not become Microsoft: Not only did Apple build and maintain a large enough user base to support the iOS ecosystem, but the company also took most of the profits of the entire smartphone industry.Due to inconsistent reports across the industry, there is no way to get an exact share.But most estimates think.Apple’s smartphone industry’s share of industry profits in the past five years has been between 70% and 90%.As we all know, Apple is integrated.Great advantage.Benefits of integration I have written articles about Apple integration many times over the years, so instead of repeating these points, let me use three articles to highlight three of them.First, integration provides a superior user experience.From the article “What Clayton Christensen Got Wrong”: My analysis of vertical integration has a problem (this is exactly what I learned in business school), which only considers financial costs, but there are other things that are more difficult to quantify behindthe cost of.Modularity can lead to poor design costs and a poor user experience.These costs cannot be overcome or measured.Suppliers and analysts ignore these at all, but consumers will not ignore them.Some consumers are inherently valued for quality, look and feel, and pay great attention to detail, willing to pay a premium that far exceeds the financial cost of vertical integration … Not all consumers value or can afford AppleProducts can turn out to be the majority.Moreover, Apple will begin to lose the premise of consumers because Android is “good enough” and cheaper, which is contrary to consumer behavior in all other markets … Apple is-and at least in the past15 years-completely focused on the blind spot of low-end subversion theory: design-based differentiation, although it cannot be measured, can certainly be felt by consumers who are both buyers and users.Second, integration maximizes the likelihood that new products, including the iPhone itself, will succeed.From the article “How Apple Creates Leverage, and the Future of Apple Pay”: Carriers (before iPhone) … basically provide the same services: voice, text messages, and data, all of which are interoperable.This also leads to an increase in the flexibility of substitution, giving Apple the opportunity to adopt a single-point breakthrough strategy: they only need the support of an operator.According to reports, Apple prioritized negotiations with Verizon on the iPhone, but Verizon has defeated AT & T (Cingular at the time) through active investment and technology choices, leading to an increase in the number of users, noting that it is not necessary to change their strategy and already has a strong brandAnd full control experience.At the same time, AT & T is just the opposite. They are at a disadvantage. They are more willing to compromise in terms of brand and user experience, so AT & T has launched an iPhone that complies with Apple’s specifications.At this time, Apple’s user experience advantage and corresponding customer loyalty dominated: for the first time in history, consumers were willing to endure the hassle and expense of changing phone operators, just to be able to use specific devices.In the next few years, despite Verizon’s improved service levels, its users also began to lose, due to the impact of the iPhone on AT & T, the gap between the two has not kept widening.Four years later, the iPhone finally came to Verizon. In other words, Verizon eventually accepted the exact same agreement that they rejected in 2006 because Apple users’ loyalty left them no choice.Third, integration is very profitable. From a money-making perspective, it is a monopoly: Apple devices are the only devices running iOS.From “Everything as a Service”: Apple has perfected its manufacturing model: Most of the company’s employees are devoted to the design and marketing of California’s iconic equipment, which is produced in Chinese factories and then shipped to destinations around the worldConsumers of the best smartphones, tablets, computers and smart watches.What makes this model so effective-and so profitable-is that Apple has distinguished between hardware and software that could have been commercialized.Software is a completely new type of commodity because it is infinitely reproducible and has zero marginal costs.This means that any piece of software is completely unique and has unlimited supply, with a theoretical price of $ 0.However, by combining the different characteristics of software and hardware, Apple is able to charge an incredible premium for its products. In contrast, hardware requires real assets and commodities to produce.This result says it all: In the past “declining” quarter, Apple had revenues of $ 50.6 billion and profits of $ 10.5 billion.In the past nine years, the iPhone alone has generated $ 600 billion in revenue and nearly $ 250 billion in gross profits.At least from a business perspective, it may be the most valuable-“best”-product of all time.Now, five years later, the traditional notion has been reversed: integration is clearly the best.Just look at Apple!But it is worth pointing out that there are also some potential negative effects highlighted.Keyboard Chaos Recently, Apple Inc. has done an amazing big thing: It released a new laptop, and the keyboard looks user-friendly, both in how it works and how often it works.The reason why I say this is because such a feature that should have been so bland is so concerned that it is incredible.And it’s not just that, because there is no new keyboard for the entire MacBook series, Apple still needs to publish this support article, suggesting to use compressed air to clean the keyboard of your laptop.Needless to say, this is abnormal.Apple first released its infamous butterfly keyboard in April 2015, and it did not replace it on one of the models until November 2019.During this time, Apple sold $ 99 billion worth of Mac computers, most of which were laptops.This is the power of integration!Or, in other words, this is the power and weakness of monopolies.Amazingly, Apple doesn’t have a monopoly on the computer market.But this company does monopolize macOS.It sells the only hardware that runs macOS, which is why, despite the widely reported risks of major issues over the past few years, millions of customers continue to buy Apple computers.To be clear, Apple has not committed any illegal acts here.At the same time, if this company faces any kind of competition, it is difficult to imagine that this butterfly keyboard will last for four and a half years and continue.Integration can produce a better user experience, but once integration products no longer face competition, it can lead to hostility to users.The second story of NFC and innovation comes from Germany. The Verge reports: According to Zeit Online, the German parliament voted on Thursday that Apple may be forced to allow competitors to compete with its Apple payment service in Germany on iOS.This provision was introduced in the form of an amendment to the Anti-Money Laundering Bill, which only needs to be passed by the House of Lords and will become law next year.If these measures become law, then in Germany, Apple may be forced to allow other companies to use the NFC chips of its phones, and Apple has traditionally strictly controlled the use of these chips.Zeit Online noted that this change could lead to individual banks offering NFC payments through their own applications rather than through Apple’s services.Later, Apple can charge a fee for using the NFC chip, but it won’t get the 0.15% fee it currently gets from every Apple Pay transaction.Apple Pay and Apple’s restrictions on NFC are definitely competitive.Due to Apple’s control of the iPhone, especially its built-in NFC chip, Apple can give Apple Pay a clear advantage over competitors’ payment applications (which require the use of awkward QR codes).This means that Apple can use its position in smartphones to occupy a strong position in terms of payments.But it is worth emphasizing how integration hinders innovation, especially in the context of this article.NFC stands for “Near Field Communication”, a protocol for two electronic devices to communicate when they are less than 1.5 inches (4 cm) apart.There are three uses for NFC chips on smartphones: smart card emulation, where NFC devices function like payment cards; Apple Pay is an example, and there are many other use cases, such as transit tickets or smart keys.An active NFC device reads and writes a passive NFC device, such as an NFC sticker that receives the magnetic field energy generated by the active device.Point-to-point, two NFC devices exchange information on a specific basis.In short, NFC technology makes communication between two devices possible without any prior setup, which makes a range of use cases possible, such as Bluetooth … but the only NFC that most people might useTechnology is payment.why?I think Apple should take a lot of responsibilities.Although Android devices have had an NFC chip since 2010, Apple only added the NFC chip to the iPhone in 2014, and it was limited to Apple Pay.Two years later, Apple made it possible to read some NFC tags and use Apple Pay. Only two months ago, writing to NFC tags became possible.The problem is that the NFC chip on the iPhone is not yet open: it’s integrated with iOS, and Apple is holding on to the reins.Considering that Apple can get a 0.15% fee from Apple Pay transactions, as well as the fees previously charged to third parties to integrate into their ecosystem or build attachments, we can’t help asking how much finance there was during the slow rollout of NFCConsiderations.But since Apple has complete control of the NFC chip in the iPhone, innovation across the industry has been hampered, and this seems to be no doubt.The last message from App Store control comes from The Washington Post: Recently, Apple removed all e-cigarette-related applications from its App Store, supporting those who call e-cigarettes a “public health crisis” and “adolescent epidemic”expert.Of the 181 e-cigarette applications removed by Apple, some allow users to control the temperature or other settings of the e-cigarette device.Other applications provide users with access to social networks or games.The App Store has never allowed e-cigarettes to be sold through apps.Apple spokesman Fred Sainz said in a statement: “We are constantly evaluating the application and refer to the latest evidence to determine the risks to user health and happiness.” Apple cited the Centers for Disease Control and Prevention and other groupsEvidence that e-cigarette smoking is associated with death and lung injury.People certainly want to cheer for such a decision, especially given the health crisis surrounding this year’s e-cigarettes, and broader concerns about e-cigarettes becoming an upward trend in tobacco use.But then again, it may be beneficial for the device to be able to connect to your smartphone.Please note that this text was written by a medical marijuana user: however, there are more sophisticated devices that have USB or even Bluetooth interfaces that allow the patient to control heating settings, display lights and update firmware.Bluetooth devices come with apps on iOS and Android mobile platforms that allow patients to measure and monitor their usage, and, like PAX, can identify drugs loaded into the device and understand their contents, such as overall cannabinoidsProfiles, terpene blends, and other components.It also allows users to verify the authenticity of the drug as well as test and batch results.These apps (and therefore device features) are no longer available to iPhone users, and you ca n’t get this level of functionality in your browser, not because regulators rule them out of law, or because Congress passed a law,It’s because a group of tech executives doesn’t allow it.And they dominate because the App Store is integrated with the iPhone: Apple has a monopoly on which apps can or cannot be installed.Apple’s App Store strategy also raises issues of competition and innovation.As for the former, Apple is using its control of the App Store approval process to tax digital products or bring advantages to its own competitive services.As for the latter, Apple’s restrictions on developing business models make it extremely difficult for productive applications to appear on iOS.There is no doubt that Apple’s tight control of the app store has brought huge benefits, not only to Apple and its revenues, but also to developers, as well as to customers who have been scarred from the Windows malware disasterin this way.However, this control also comes at a huge price.Integration and Monopoly This article is not a legal argument: in particular, I use the term “monopoly” very broadly.From a business point of view, Apple is so outstanding because it obtains monopoly profits in a way that would not normally be classified as a monopoly through the integration of hardware and software.Nevertheless, in my opinion, although “integration” brings good results, “monopoly” does not.Please note the contrast between the integration advantages I mentioned in the article and the bad results later: the superior user experience provided by Apple integrated products ends with Apple Inc. providing this user-friendly butterfly keyboardIt lasted for four years and continues.Apple’s ability to use its user base to bring new products and features to market also means that Apple may delay the development of NFC applications.Apple’s ability to make high profits from software-differentiated hardware is increasingly being strengthened as Apple tries to collect rent from digital products and / or give the company’s own services a competitive advantage.In all cases, this is a common problem in the technology industry.The technology industry tends to start in a highly competitive state, but will soon be transformed into a monopoly or dual monopoly, such as network effects and economies of scale acquisitions.We have seen similar progress in the areas of operating systems, search, social networking, digital advertising, e-commerce, etc. Apple’s advantage in this area is no exception!However, the reason why I think Apple ’s example is particularly illustrative is because it helps to draw a line between the two: on the one hand, healthy integration is generally beneficial, and on the other hand, monopoly rent-seekingInvolves the respective revenues of the dominant companies.Specifically, companies that create and compete in new markets should be allowed to win and benefit from their innovations.I have no objection to the profit of Apple smartphones, 0.15% of Apple payment or 30% of Apple App Store.However, it should be limited that the use of victory in one area dominates the other: this means that Apple’s victory in the smartphone field does not mean that it can have digital payments, and the invention of the App Store does not mean that itGet 30% of all digital products (or be allowed to weaken the user experience of its competitors).Translator: Scale..