Linked List: October 20, 2014

Monday, 20 October 2014

Daisuke Wakabayashi, writing for The Wall Street Journal:

A year ago, the story line around Apple Inc. was that its formidable growth had petered out and Samsung Electronics Co. was eating its lunch. What a difference a year makes.

Driven by booming sales of its new bigger-screen iPhones, Apple on Monday said its quarterly profit rose 13%, and it predicted record holiday sales in the current three-month period.

Meanwhile, Samsung’s approach of offering smartphones at all sizes and prices in every market is struggling amid a wave of Chinese manufacturers with low-cost offerings.

I like the way Wakabayashi poses this. That was “the story line”. It wasn’t the actual truth, it turns out, it was just the story line. But whose story? Well, it was the story put forth repeatedly by, to name just one example, The Wall Street Journal itself, repeatedly. Samsung is beating Apple is a narrative that the WSJ drove. Here’s a perfect example from January 2013 (“Has Apple Lost Its Cool to Samsung?”):

Samsung’s surge in smartphones has caused more than just consumers to switch away from Apple. Some app developers have said they are now focusing more attention on Samsung devices.

Ken Yarmosh, chief executive of Savvy Apps in Washington, D.C., said his company began by making apps for Apple’s iOS operating system but lately has been focusing on Android as Samsung devices have become more prevalent, especially among his own company’s testing devices.

“There was a major flip — it was Apple, then if you have money build for Android,” Mr. Yarmosh said. “Now it’s Android first, or Android only.”

So it’s not that the WSJ was wrong. It’s the story that was wrong. Even though the WSJ wrote and drove the story. Got it.

Yosemite, Spotlight, and Privacy ★

Russell Brandom, writing for The Verge, responding to a mostly-wrong piece in The Washington Post on Yosemite Spotlight and privacy:

But on closer inspection, many of the claims are less damning than they seem. There’s already a public privacy policy for the new feature, as well as a more technical look at the protections in the most recent iOS security report. That document breaks down five different kinds of information transmitted in a search: the approximate location, the device type, the client app (either Spotlight or Safari), the device’s language settings and the previous three apps called up by the user. More importantly, all that information is grouped under an ephemeral session ID which automatically resets every 15 minutes, making it extremely difficult to trace a string of searches back to a specific user. That also makes the data significantly less useful to marketers, since it can’t track behavior over any meaningful length of time. And most importantly, the data is transmitted over an HTTPS connection, so it can’t be intercepted in transit.

I’m not sure how anyone would think these suggestions would work if information weren’t being sent back to Apple. The only thing Apple could do differently is make this another one of the you-have-to-explicitly-opt-in stages when you first upgrade to Yosemite or create an account on a new Mac. But there are a lot of those on-boarding screens already — to Apple’s credit! — and in this case, even if you are using the feature, Apple has seemingly gone out of their way to protect your privacy.

This Is Tim: Apple’s CEO Answers the Analysts ★

Jason Snell, now at Six Colors:

Then comes the question-and-answer session, which while hardly extemporaneous — you get the sense that most of the questions have been anticipated and talking points formulated — lets Apple CEO Tim Cook provide a level of detail into how Apple’s business is shaping up that can be illuminating.

And so, presented with minimal editing, here’s a transcript of how Cook answered the analysts on Monday.

Apple to Require 64-Bit Support and iOS 8 SDK for iOS Apps Starting in February ★

Apple Developer news:

Starting February 1, 2015, new iOS apps uploaded to the App Store must include 64-bit support and be built with the iOS 8 SDK, included in Xcode 6 or later.

Keep up, or get out.

Tim Cook, in His Own Words, on the iPad’s Future ★

Dan Frommer:

Apple’s iPad business was the lone drag in its otherwise strong earnings report today. iPad sales last quarter dropped 13% from the previous year, to 12.3 million, their third straight quarter of decline. The iPad, which once looked like it could become an iPhone-sized pillar for Apple, represented just 13% of the company’s sales last quarter.

It would be better for Apple if the iPad were more like the iPhone, with continuing year-after-year sales growth. Only a fool would argue otherwise. And until about two years ago, it seemed like that might be the case.

Ends up, no, the iPad isn’t the iPhone, and in a broader sense, the tablet market isn’t like the phone market. It’s more like the PC market. It would have been truly extraordinary if, with the iPad, Apple had managed to build another iPhone-sized business. But it’s still pretty extraordinary that, if you treat the iPad as a PC (and the average selling price supports that), Apple has become the largest PC maker in the world in terms of unit sales.

‘Finally’ ★

Jason Parker and Nate Ralph, writing for CNet (emphasis added):

With the launch of iOS 8.1 today, Apple has finally launched Apple Pay, the new NFC payment system that lets you make purchases using an iOS device.

These guys should have their CNet CMS accounts flagged, such that they’re no longer allowed to submit copy including the word “finally”.

Apple Q4 2014 Quarterly Results ★

Apple PR:

Apple today announced financial results for its fiscal 2014 fourth quarter ended September 27, 2014. The Company posted quarterly revenue of $42.1 billion and quarterly net profit of $8.5 billion, or $1.42 per diluted share. These results compare to revenue of $37.5 billion and net profit of $7.5 billion, or $1.18 per diluted share, in the year-ago quarter. Gross margin was 38 percent compared to 37 percent in the year-ago quarter. International sales accounted for 60 percent of the quarter’s revenue. […]

“Our fiscal 2014 was one for the record books, including the biggest iPhone launch ever with iPhone 6 and iPhone 6 Plus,” said Tim Cook, Apple’s CEO. “With amazing innovations in our new iPhones, iPads and Macs, as well as iOS 8 and OS X Yosemite, we are heading into the holidays with Apple’s strongest product lineup ever. We are also incredibly excited about Apple Watch and other great products and services in the pipeline for 2015.”

This is the first time I can recall that Apple’s press release for its quarterly results doesn’t include unit sales by product line — the total number of iPhones, iPads, Macs, and iPods sold. It’s listed in the “Data Summary” PDF, but not in the press release.

Year over year, iPhone sales were up (39M from 34M), iPad sales down (12M from 14M), and Mac sales had the biggest percentage change of all, up 21 percent (5.5M from 4.5M).

Update: Looks like they stopped including unit sales numbers in the press release earlier this year. Not sure why I didn’t notice then.

Paul Krugman: ‘Amazon’s Monopsony Is Not OK’ ★

Paul Krugman:

So far Amazon has not tried to exploit consumers. In fact, it has systematically kept prices low, to reinforce its dominance. What it has done, instead, is use its market power to put a squeeze on publishers, in effect driving down the prices it pays for books — hence the fight with Hachette. In economics jargon, Amazon is not, at least so far, acting like a monopolist, a dominant seller with the power to raise prices. Instead, it is acting as a monopsonist, a dominant buyer with the power to push prices down.

And on that front its power is really immense — in fact, even greater than the market share numbers indicate. Book sales depend crucially on buzz and word of mouth (which is why authors are often sent on grueling book tours); you buy a book because you’ve heard about it, because other people are reading it, because it’s a topic of conversation, because it’s made the best-seller list. And what Amazon possesses is the power to kill the buzz. It’s definitely possible, with some extra effort, to buy a book you’ve heard about even if Amazon doesn’t carry it — but if Amazon doesn’t carry that book, you’re much less likely to hear about it in the first place.