Linked List: February 24, 2015

Tuesday, 24 February 2015

Josh Centers does some back-of-the-envelope math to estimate how much raw gold Apple might need for Apple Watch Edition production:

There are two conclusions we can draw from this scattering of data. The first is that Apple is about to take over the world. Not only will it be the most valuable company on the planet, but it will also be bidding for a third of the world’s annual gold supply, wreaking havoc on gold prices and doing who knows what to the global economy.

The alternative is that the esteemed Wall Street Journal is off on its Apple Watch Edition sales by an order of magnitude (or more). That would put the number at 100,000 per month, which seems more plausible.

I think the WSJ’s sources are deeply suspect on these production numbers. There’s no way Apple is planning on selling one million Edition models a month. That’s just nutty. Rolex sells only 600,000 watches a year.

Profit Margins and the Apple Car ★

Matthew Yglesias, writing for Vox:

There are dozens of ways in which Apple’s apparent effort to build an Apple-branded car could go wrong, but there’s one argument against the idea that I’m hearing a lot of that really doesn’t make sense. From Henry Blodget to former GM CEO Daniel Akerson to the LA Times to Yahoo Finance people are saying this won’t work because the car industry is a “low margin” business in contrast to the fat margins Apple is used to earning most of all on its workhorse iPhone.

The misperception here is that Apple earns high margins because Apple operates in high margin industries. The truth is precisely the opposite. Apple earns high margins because it is efficient at manufacturing and firmly committed to a business strategy of sacrificing market share to maintain pricing power. If Apple makes a car, it will be a high margin car because Apple only makes high margin products. If it succeeds it will succeed for the same reason iPhones and iPads and Macs succeed — people like them and are willing to buy them, even though you could get similar specs for less.

Bingo.

The Apple Watch Edition’s Upgrade Dilemma ★

Serenity Caldwell, writing at iMore:

Apple could solely go after the high-end fashion market, say “These customers have no qualms about paying $15,000 every two years,” and be done with it. Or the company could invest in some sort of long-term support for its Edition customers. And even after writing all this, I’m still no closer to figuring out which one the company will pick. The former model favors Apple’s traditional business model, just at a much higher income bracket. The latter feels more like an Apple move, to support its customers and give them the best experience possible.

I hope Apple Watch — at least the Edition models — is upgradeable. I would bet that it’s not. The single most frequent question I’ve received this week is how can Apple justify $10,000+ prices for a watch that will be technically outdated in a few years. The simplest answer is that it’s for people who don’t care.

I say I’d bet against upgradeability simply because it’d be so unlike Apple. But, the whole idea of a solid gold $10,000 watch is also unlike Apple. We’re in new territory here. And I do wonder why Apple called out the modular design of the S1 on their technology page. Why does this image exist? An “upgrade” would probably require new sensors and antennas and battery too — more or less replacing everything inside the watch case.

Apple Car: Three More Thoughts ★

Good column from Jean-Louis Gassée on the idea of Apple making cars:

I would love to be wrong about the AppleCar — I join the choristers who would love to see what Apple could do with a car — but we’ve heard a bit too much about Apple’s ability to design an interesting electric vehicle and not enough about the industrial part, about the machine that makes the machines.

Useful Mac ★

New website by Garrett Murray. Already a winner by introducing me to this gem of a Safari extension.

Pebble Time ★

Blow-out Kickstarter campaign to launch the second-generation Pebble watch: $6 million and counting on the first day. Looks far more compelling than the first-generation model, with a microphone for input, a color (but still e-paper) display, and a new timeline-centric UI paradigm. They’ve also gone back to a more utilitarian design, wisely abandoning the direction they went with Pebble Steel.

I found wearing an original Pebble Watch to be more annoying than useful, but it’s hard not to root for a small independent company with original ideas going head-to-head against Apple Watch and Android Wear.