Apple services are growing, hardware slowing

Apple posted quarterly results, and received a standing ovation: the stock rose 7% at the opening this morning.
What’s intriguing is that the numbers show lower sales of iPhone (down 15% compared to last year), Mac (down 10.5%), and iPad (down 8.3%). But Apple has pulled off some hand jive, and drawn attention to what may be the future of its growth engine: services.
In the release, Luca Maestri — Apple’s CFO — wrote ‘our Services business grew 19 percent year-over-year and App Store revenue was the highest ever, as our installed base continued to grow and transacting customers hit an all-time record’.
As I mentioned earlier this week (see What’s going on in Phoneland?), the market had already priced in the negatives coming in Apple’s quarterly results. As others — like Chris O’Brien — have pointed out, Apple has done a great job managing the expectations of Wall Street, and drawing the analysts’ attention to the figures Apple wants us to pay attention to. And the trend in services, and the growing margins in iPad sales, are the figures that are causing the stock to soar.
Tim Cook stated that the services side at Apple is on track to be ‘the size of a Fortune 100 company next year’.
So, once again the maturation theme is front and center: Apple’s sales of new hardware is dropping, but with a huge installed base, what can Apple do to make money? Sell — or more aptly, rent — services to all those folks with iPhone, iPads, and Macs. (Oh, and Watches, but that’s too tiny to matter, and might never.) So if Apple can continue to grow services to the installed base — plus get some additional boost in iPhone sales in the fall when new models come out — the company will remain a Wall Street darling.
Relative to enterprise sales, the better margins in iPads has got to be a proxy for increased sales in the enterprise based on the new larger iPad Pro. But, at present, Apple doesn’t have much of a story for enterprise services. Maybe it’s time to the company to revisit the plan to buy Dropbox or Box, and replace/rework iCloud (iCloud Pro?) with a cloud file sync-and-share solution –including a deep integration with Apple’s productivity suite — that makes more sense for the enterprise?
 

Apple eyes the office with new iPad Pro, its tablet workhorse

We may have known it was coming, but that doesn’t make it any less exciting.

Just after a quick update on Apple Watch during Apple’s live event, CEO Tim Cook announced what he called “the biggest iPad news in iPad since iPad.”

iPad Pro's screen measures 12.9 inches diagonally

iPad Pro’s screen measures 12.9 inches diagonally

iPad Pro. Apple’s Phil Schiller gave us a rundown of the new addition to the iPad line.

Predictably, it’s bigger. A lot bigger.

At 12.9 inches, the width of the iPad Pro’s display is the same as the height of the iPad Air 2’s. In fact, that kind of screen real estate brings iPad Pro’s display awfully close to that of a 13-inch Macbook Pro (obviously).

iPad-Pro-005

Side-by-side of iPad Air 2 and the new iPad Pro

So, what’s Apple doing with all of that room?

Well, for starters, the company is putting a new chip behind it. iPad Pro will be powered by Apple’s new 64-bit A9X processor, which is seriously quick –up to 1.8 times faster than its predecessor, the A8X. What does that mean, exactly?

Well, to put it simply, it means that this processor puts iPad firmly in the realm of desktop-class performance, with graphics that perform in console-class. Which is great, but also a necessity considering where Apple is trying to position this model.

It’s a 2-in-1 or “detachable” tablet, rather than the “slate” style (like every other iPad model). These 2-in-1 tablets are designed to be extremely productive devices meant to complete tasks normally outsourced to desktop and laptop computers.

In order to make iPad Pro a device that can bridge the divide between the power of a desktop computer and the portability of a tablet, Apple had to go beyond a big screen and a quick processor, though.

A big part of using a desktop/laptop computer is typing, which has never been ideal on iPad (or any other “slate” tablet). Now, iPad Pro has a full-size software keyboard, which should make typing on-screen faster, easier, and a bit more natural.

Still, typing on a touchscreen is far from ideal. So, Apple also announced the first in a handful of new accessories: the Smart Keyboard, a detachable keyboard with keys that feature the same technology unveiled in the new Macbook.

iPad-Pro-008

Apple’s Smart Keyboard for iPad Pro

That brings us to the other peripheral Apple announced in conjunction with iPad Pro: Apple Pencil.

An illustration of the inside of the Apple Pencil.

An illustration of the inside of the Apple Pencil.

Yeah, it looks like a stylus. But it isn’t. (No, really!)

Though it functions much like a stylus (aka a dumb pen-shaped solid object with a soft tip at one end) on the surface, Apple Pencil’s tip is full of sensors that allow greater control for applications like drawing, writing, and annotating.

A key component of iPad’s productivity boost is iOS 9 (available September 16th), which will allow you to make use of that massive screen with multitasking features like easy app-switching, the “split view” that lets you view and work in two applications at once, and the picture-in-a-picture feature that allows you to watch videos whilst you work in another app.

Though iPad Pro is big and an unprecedented kind of powerful, it remains relatively lean. The new model is just 6.9mm thick, compared to iPad Air’s 6.1mm. Though it’s considerably heavier at 1.57 lbs., iPad Pro is still extremely portable.

At a time when we’re all increasingly fed up with toting around heavy laptops and chargers, iPad Pro may prove a force to be reckoned with. While its 10-hour battery life may not hold a candle to iPhone, it’s far better than the battery lives of most laptops, and it’s much easier to haul.

Of course, that’s not to say long-time Apple fans won’t have something to say about the Pro — namely how the split screen view and not-stylus stylus (aka the Apple Pencil) are things Apple founder Steve Jobs wasn’t a fan of when it came to tablet innovation. But the Pro also isn’t intended primarily for consumers, either. It is, perhaps, the company’s most direct attempt to court enterprise customers to date.

iPad Pro will be available in November. The 32GB model starts at $800 with the 64GB model coming in at $949, and the 128GB model at $1079.

Apple’s ‘Hey Siri’ event wish list: iPad Pro, iPhone 6S, & a worthy Apple TV update

We have only a single clue ahead of next week’s Apple media event: “Hey Siri, give us a hint.”
Oh, and no shortage of rumors, whispers, and posturing.
Apple’s keynote is September 9. We expect Siri to take a starring role, with Apple incorporating its digital assistant inside new products, such as an entirely new Apple TV (that may even feature third-party apps for the first time). Pushing Siri into the limelight will become even more necessary as smartcars and smarthomes become as commonplace as smartphones.
We also know the keynote will take place in San Francisco’s Civic Auditorium, which seats 7,000. That’s huge. Toss in the fact that it’s going to be streamed not only to iOS devices but Windows 10 users as well, and we are expecting a bold, boisterous Apple — one that’s eager to reveal its intentions to be everywhere we are, and with us everywhere we go.
Expectations aside, here are all the things we’re hoping Apple will announce within new or updated products, along with the (completely unscientific) odds it will happen:
Apple Event

iPhone

Go Smaller (Odds: 25%)

iPhone 6S and iPhone 6S Plus are a given. We also hope Apple introduces a non-phablet device, one about the dimensions of an iPhone 4S, but with the newest hardware, Touch ID, and better camera. Phablets are awesome, but they’re not for everyone.
That said, there have been no reliable reports of a new device in an old form factor.

Force Touch (Odds: 90%)

Force Touch senses how hard or light the user is touching the screen, enabling an entirely new palette of controls. Touch the screen with extra pressure to call up a secondary menu, for example, or to access a weapons cache in your favorite first-person shooter. At the very least, Force Touch will reduce the number of swipes and taps required for a specific task.
If executed properly Force Touch could even negate the need for a home button. No home button means much more screen real estate. We are not expecting this anytime soon.

Bigger Battery (Odds: 25%)

Unless you’re rocking an iPhone 6 Plus, with its massive 2,910 mAh battery, at some point during the day you’re scoping out a wall socket. It’s 2015 and this needs to stop. We wish for significantly improved battery life. Otherwise, it’s like building the world’s greatest off-road vehicle, but including only a tiny gas tank. Lots of places you could take it, but you better not.
Unfortunately, there’s been very little chatter about a larger battery.

More Speed (Odds: 90%)

A new A9 processor and more RAM seem almost certain. This means better response, improved gameplay, fewer lags, even when running Pandora or Google Maps in the background, for example.
It’s also rumored the new iPhones will include a Qualcomm chip that increases LTE download speeds from 150 Mbps to 300 Mbps. That’s a noticeable improvement. We think this will happen.

A Sharper Image (Odds: 90%)

Multiple sites have all but confirmed that the new iPhones will include a 12mp camera — a decent leap in resolution over iPhone 6’s 8mp offering.
There are also multiple reports that the front camera will get a much-deserved boost from its paltry 1.2mp to 5mp. That, plus the expected front-facing slo-mo video feature should help usher in a whole new selfie revolution — and require Instagram to purchase a lot more servers.
We are hoping for a 16mp camera, which is now standard on most premium smartphones, but we think the odds of this happening are very slight.

Would Apple really stick a USB port on an iPad?

Yesterday’s Bloomberg report on big iPad delays seems to have gotten a few people in Apple’s supply chain talking. On Thursday, the Wall Street Journal and Digitimes both followed up with their own stories on the rumored “iPad Pro” with a 12.9-inch screen.

However, some of the details in the WSJ report are bewildering. For instance:

Apple is now considering adding USB ports and adopting so-called USB 3.0 technology, a much faster version that promises to transfer data up to 10 times as rapidly as current USB ports, one of the people said.

Later in the article:

The company has also been considering adding ports to connect to a keyboard and mouse, the people said.

If you follow Apple rumors, these details seem unlikely. First, a Microsoft Surface–style traditional USB port on a tablet would almost certainly compromise an iOS device’s thinness. Second, Apple has been moving away from mice — even on its desktops — for years, preferring trackpad gestures.

That’s why I believe the supply chain details in the WSJ need some translation. The “USB 3.0” technology mentioned could be referring to reversible USB Type C ports. Apple has been tipped to be considering the skinny next-gen connector as the primary port and charger for a future MacBook, and if that were to happen, I think it would make sense to bring Apple’s MagSafe replacement to the bigger iPad, which could have power needs closer to a desktop than a smartphone. The question then becomes whether the USB port replaces the Lightning connector, which is the existing charge and sync port for iOS devices.

USB Type C

The Wall Street Journal says the advantage USB 3.0 provides is faster wired data transfers, which doesn’t strike me as a particular weakness of the existing iPad. However, it also mentions new technology to speed up charging times, which would be welcome.

The keyboard and mouse details are equally confusing. It wouldn’t be a surprise if Apple introduced a keyboard case — many Android and Windows tablets already have first-party keyboard cases, and the success of iPad keyboard accessories shows there’s a market there. But an Apple mouse would require significant changes to iOS to adapt it to an older form of input, which seems unlikely. I think the mouse is more likely to be the iOS smart stylus that was previously rumored. But even then I think there’s a better chance it’s connected through Bluetooth than through a wire.

On Wednesday, Apple was said to have delayed production of the 12.9-inch iPad until September because of supply issues. What could be causing the shortage in displays? One guess is that the delays are due to new high-density screens with a resolution around 4K. However, supply chain rumormonger Digitimes says the reason is a new display technology, Oxide TFT LCD, which has the main advantage of being more power-efficient. Apple has been said to be looking into Oxide TFT LCD technology in the past.

It’s all a bit unclear what’s going on with the 12.9-inch iPad. The WSJ indicates that Apple could decide not go to through with some of these features, which is true of all Apple products. One thing is clear, though: You won’t be seeing the bigger iPad at next week’s Apple Watch event.

Sounds as if the big iPad isn’t launching any time soon

An unannounced Apple product has been delayed, according to Bloomberg, which is reporting that production of the long-rumored 12.9-inch iPad is scheduled to start in September.

This news makes it even unlikelier that Apple will introduce its “iPad Pro” at its Apple Watch event in San Francisco next week. The report said that Apple planned to start production this month, but pushed it back because of supply issues with display panels.

The current iPad Air 2 has a 9.7-inch screen and iPad Minis have a 7.9-inch display. Although an iPad with a 12.9-inch screen has never been confirmed by Apple, there’s a lot of evidence that it exists. Questionable schematics for the device leaked in Japan late last year, and references in iOS 8 indicates that Apple has been working on a split-screen mode, which would be perfect for the device’s bigger screen.

Patents and analysts have suggested that the bigger iPad will support an optional smart stylus. Bloomberg reported last summer that the big iPad was due in the first quarter of 2015. The Wall Street Journal has indicated that the big iPad was previously delayed because of a focus on the iPhone 6, which came out last fall.

If production starts in September, it could be a tight squeeze to get the product on shelves by Christmas. Last year, Apple announced new iPad models in October and shipped them a week later. But missing the holiday season might not matter to Apple, especially if it angles the bigger iPad as a business-oriented tablet, with a possible tie-in to its enterprise partnership with IBM.

Screen sharing could be a future Apple FaceTime feature

Apple’s FaceTime service is currently just a method of two-way personal communication, but it could become much more. A patent granted to Apple shows how FaceTime would work as a collaborative productivity tool, complete with data and app sharing.

AppleInsider noted the new patent grant on Tuesday, with images such as this one showing how screens could be shared over FaceTime on an [company]Apple[/company] iPad while the app maintains a two-way video conversation.

facetime screen sharing patent

This particular example also shows that FaceTime users could control what application data is shared between two parties; on the right you can see shared calendar information.

The patent describes how data controls would work — determing what can be shared based on user controls or the type of connection. ranging from specifying exactly what can be shared based on user controls or by the type of connection. Sharing a screen or an app over Wi-Fi might be preferable to sharing it over an LTE connection, for example.

Apple’s FaceTime service is only available on iOS and OS X devices, of course, so don’t expect to share your Windows Desktop or apps any time soon using FaceTime, even if Apple does implement what’s described in the patent. Besides, there are plenty of third-party apps that offer that functionality now on non-Apple devices.

Soon non-developers will be able to try beta versions of iOS

If you want to check out what Apple’s cooking up in the next update of iOS, you currently have to sign up for its $99 per year developer program or give your device UDID to a sketchy service in order to install public beta builds on your iPhone or iPad. That’s changing soon: According to the reliable Mark Gurman at 9to5Mac, Apple is planning to extend its Appleseed public beta program to iOS starting with version iOS 8.3 next month.

iOS 8.3 is already public and in the hands of developers. [company]Apple[/company] is probably not going to launch a public beta of iOS 9 or other major releases before they’re announced. Gurman points out that iOS 8.4 will probably include Apple’s new streaming music service, so beta testers may get first access to the next episode of Beats Music.

Apple started offering public beta versions of its desktop OS last year, allowing Mac users to check out OS X Yosemite before it was officially launched. Not only does this keep hardcore [company]Apple[/company] fans happy, but it can also help squash bugs, which according to anecdotal evidence, seem to be increasing in recent years due to Apple’s aggressive release schedule. Last fall, Apple pushed an embarrassing incremental iOS update that killed cellular service for many iPhone users, for instance. The OS X beta program was limited to the first million users to sign up, so it’s possible the iOS beta program will have a cap too.

Here’s the Appleseed landing page and here’s the OS X beta signup page. Keep an eye on them if you want to be one of the first non-Apple employees to check out iOS 8.3.

 

Microsoft adds digital ink and search in OneNote for iPad

Did someone declare this to be “let’s all make the iPad better with stylus support” week and not tell me? First we had Astropad, a $50 app that turns Apple’s slate into a graphics tablet, and now Microsoft is bringing of digital handwriting support to the iPad.

InkingWithiPad3-1024x768

[company]Microsoft[/company] announced the software update to its OneNote application that adds the new feature on Thursday, pointing out that OneNote has actually supported digital ink since 2003. I actually didn’t need the reminder: I remember using the first iterations of OneNote way back then on a convertible Windows Tablet PC with digital stylus. I said back then — and I still believe it’s true — that OneNote is one of the best pieces of software ever to come from Microsoft.

[youtube=http://youtu.be/bOpxNVJ7tZ4]

If you’re not familiar with the app, it works similarly to Evernote, helping you capture and categorize snippets of text, screenshots, photos and other data, including audio recordings. The secret sauce of OneNote, however, has long been its excellent digital ink support, completely with OCR, or optical character recognition.

This lets the app index all information to make it fully searchable, either in the app or in OneNote Online. The latest version of OneNote for iPad doesn’t yet do that for handwritten notes but does for images. This example shows a search for “strawberries” on a receipt photo, for example.

InkingWithiPad4-1024x768

With the latest software update to OneNote, [company]Apple[/company] iPad owners will see a Draw option in the app. Tap it and you can draw or write with your finger or a stylus; the latter is clearly recommended. You can digitally annotate any captured content in OneNote with this feature. Microsoft even added a palm rejection feature so your hand doesn’t accidentally “write” something when using a stylus.

Again, OneNote has been around for more than a decade, so it’s not new. It is, however, possibly one of the most underrated software products Microsoft has ever developed while also being one of the most useful. It’s well worth a preview from the iTunes App Store, particularly since it’s free for your iPad.

Astropad turns your iPad into a graphics tablet for your Mac

For years there have been options to add a drawing pad and stylus to a computer, a way for graphic artists to create digital media and drawings. Turns out if you have an iPad, you have another option. Astropad is an app that lets you draw in graphics tools on your iPad with the results displayed in real-time on a Mac.

astropad on ipad and mac

The team behind Astropad — former [company]Apple[/company] engineers — created their own wireless communications method to tie together the screen sharing between an iPad and a Mac. It’s called Liquid, and they say it’s actually twice as fast than Apple’s own AirPlay over Wi-Fi.

astropad peak performance

The app is capable of 60 frames per second refresh rates so everything you draw on the iPad should look equally good when rendered on the Mac. Images are also RGB color corrected on the iPad to match your Mac. Here’s a video demo to show the performance and functionality.

[youtube=http://youtu.be/ouwCHT3rGRY]

You can use Astropad with your finger, just as you would with any touchscreen iPad app, but a stylus is better. Astropad supports multiple pressure-sensitive pens, so if you already have one of those for your iPad, you can likely use it with the app.

Keep in mind that Astropad itself is really the mechanism to turn the iPad into a graphics tablet; it doesn’t replace graphics apps such as Photoshop for content creation. Instead, it enables the iPad as an interface for such apps.

The $49.99 app ($19.99 for students)  is available directly from the Astropad site as of today, although you can try a free demo before buying. Your computer will need to be running Mac OS X 10.9 or better and you’ll need iOS 8 on the iPad.

iMessage just got secure: Apple expands iCloud two-factor authentication

Since the embarrassing revelation that iCloud’s two-factor authentication didn’t actually cover many of Apple’s online services, partially responsible for a rash of leaked celebrity photos last year, Apple has been gradually adding the security setting to many of its other services. On Thursday, users with iCloud’s two-factor authentication enabled will need to complete extra steps when logging into iMessage and FaceTime, the Guardian reported. The feature is rolling out now, but may not be available for your specific devices yet.

For users who have two-factor turned on, when you log into iMessage on a new iPhone or Mac, your Apple ID password won’t be enough to gain access. According to MacRumors, FaceTime and iMessage are using app-specific passwords, in which you generate a unique code on Apple’s website, instead of having a four-digit PIN texted to your device.

Now, a miscreant with your Apple ID password — possibly gained through phishing, other social engineering, or even a lucky guess — won’t be able to set up iMessage or FaceTime and pretend to be you without your phone. Because of the way iMessage uses encryption, simply logging into a new device doesn’t recover old iMessages, even before Apple turned on the new two-factor authentication.

If you don’t have two-factor turned on for your iCloud account, you should do it. Here’s Apple’s guide. After all, even if you’re not a celebrity, you don’t want to get hacked and have your life turned upside down.

This post was updated on 2/13 to clarify that iMessage and FaceTime are using app-specific passwords, and not two-factor authentication with a PIN code.