Issue 26

Apple the... banker?

Delivered on 02 April 2019 by Justin Pyvis. About a 6 min read.

Apple had its big spring product launch last week and it was "meh" at best. As most Apple observers have come to expect, the focus of the event was not on shiny new devices but a handful of new subscription services, with celebrities trotted out to spruik the new offerings in a not-so-subtle attempt to paper over the company's recent lack of ideas. Indeed, not only were there no new products (other than run of the mill hardware upgrades for existing ones), but Apple announced late on Friday that its much-hyped "AirPower" charging device would be thrown on the scrapheap, a rare move for Apple.

Oprah "[Apple's] in a billion pockets y'all" Winfrey led the all-star cast.

Celebrity aside, the spring product launch revealed further details about Apple's ongoing struggle to reinvent itself. You see, in the face of fierce competition from device manufacturers in Asia, Apple has been gradually transitioning its business model away from the device market towards services, a direction its CEO Tim Cook has been moving the company since at least 2014.

So it was again last week, with the technology behemoth announcing details about a handful of new services: TV+, News+, Apple Arcade (a video game subscription service), along with the most interesting of all, the "Apple Card", a credit card offering. I'm going to deal with each one very briefly, before finishing with the credit card (scroll down if you don't care about the rest).


Apple TV (no plus) is a small box that connects to your TV and plays content from various sources. The 'plus' stands for an upcoming ad-free subscription service, much like Netflix and its competitors including Amazon, Disney, Hulu, AT&T/WarnerMedia and NBCUniversal. Apple's advantage is that it already has a somewhat captive fan base (the users of its products, not just Apple TV devices) who will at least give it a shot for a month or two. But if you can't produce quality original content to keep them there, it will all be for moot - and Apple's issues in this space are well documented.


As with TV+, Apple News+ is the same old Apple News (no plus) with some exclusive content thrown in. In the case of News+, that bonus content is access to an additional 300 magazines. It's essentially the Texture app - the "Netflix of magazine publishing", which it purchasedabout a year ago - re-branded as an Apple product. I can see how some people might find it useful to have Apple aggregate your news for you but I'm certainly not one of them.

Apple Arcade

What is Apple Arcade? You guessed it: another aggregator with a monthly subscription attached. Apple is going to "handpick" a number of existing games on its App Store that will henceforth be available exclusively on Apple Arcade, without any advertising or dreaded microtransactions (in-app purchases). Mobile gaming is growing - especially among the younger generation - and microtransactions are the bane for many a parent, so this could be a good alternative for them. As with News+ it won't cost Apple much to roll this out given that the content already exists, so it's worth a shot.

Apple Card

Finally the most interesting of the bunch, the Apple Card. Financial technology - 'FinTech' - is all the rage, and Apple wants a piece of the action. Credit where credit is due (pun intended), this card is a thing of beauty. Made with titanium and able to generate virtual card numbers for non-Apple Pay purchases (provided you have your phone handy), it's a very neat little credit card.

But as with everything else announced last week, it's nothing remarkable; it's yet another sign that Apple's days at the frontier of technology are effectively over. When I heard rumours of the Card I was hoping for an announcement along the lines of the recent Facebook/Telegram/Signal battle to offer instant paymentsvia blockchain, but instead we got a card that doesn't have/do anything that isn't already available from competitors (1-3% cash back on purchases, yay!). It's essentially a line of credit from Goldman Sachs, subject to the same constraints as any other MasterCard or Visa card out there.

All up, I wasn't optimistic about the spring product launch and I somehow still left disappointed. The big test for Apple from here will be whether it's able to sustain the inevitable flood of subscriptions to its new services once the celebrity factor wears off (as Oprah said, their devices are in a billion pockets), subscription fatigue sets in and people start to question whether they actually need multiple $9.99 a month Apple subscriptions when there are plenty of better, cheaper alternatives out there.

Shock! Horror! Zuckerberg wants to be regulated

The Zuck suddenly wants global regulations covering "harmful content, election integrity, privacy and data portability". Why would he possibly want that? Could it be because Facebook has sunk enormous amounts of capital into those four areas, and is even in the process of encrypting its messaging applications ahead of a possible revenue pivot into FinTech? Good luck competing with Facebook if Zuck gets his way - complying with Facebook will almost certainly become too costly for anyone other than Facebook. This one is straight out of the monopolist's playbook. Well played, Zuck. Well played.

Learn more:

Are Google, Amazon and Facebook monopolies?

I've written several articles about why Facebook's social media market share isn't a problem - yet (it could become a utilitised monopoly if regulators err, which is looking increasingly likely every day). This week I'm going to let Jean Tirole do the talking:

"[W]e need to distinguish between statics and dynamics, or between a transient monopoly and a permanent one. Large economies of scale as well as substantial network externalities imply that we often have monopolies or tight oligopolies in the new economy. The key issue is that of “contestability.” Monopolies are not ideal, but they deliver value to the consumers as long as potential competition keeps them on their toes. They will then be forced to innovate and possibly even to charge low prices so as to preserve a large installed base and try to make it difficult for the entrants to dislodge them."

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Huawei on top of the world

Huawei might have been banned by several technologically illiterate backwaters (e.g. Australia) but that doesn't seem to have affected its bottom line, with profits up 25% to nearly $9 billion last year. 2019 will be a tougher year, with the bans and a slowing Chinese economy likely to have a more significant effect than in 2018.

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Europe is splitting the internet

Europe, Europe, Europe. Can you say unintended consequences? It's no wonder the UK voted to leave the EU when its parliament can pass horribly misguided regulations such as the Copyright Directive. If you live in the EU and don't want to lose access to a large chunk of the internet, now is as good a time as any to jump on the VPN bandwagon. Feel free to email me if you'd like some suggestions on which provider will work best for you.

Learn more:

Other bits of interest

Image of the week

Chrome is far and away the dominant web browser, although the data might be a bit misleading. Any browser built on Chromium - the open source project on which Chrome is based - is considered to be Chrome. That means the many, many browsers (e.g. Brave Browser) show up as Chrome, even though Google has no more knowledge or control over it than it would if someone was using Firefox. Still, Chrome's dominance is disturbing; if you're up for a change, switch to the more privacy-respecting Firefox!

Issue 26: Apple the... banker? was compiled by Justin Pyvis and delivered on 02 April 2019. Join the conversation on the fediverse at