WEBVTT - Apple Unveils iPhone 16, Touts Artificial Intelligence Features 0:00:02.920 --> 0:00:10.719 Bloomberg Audio Studios, Podcasts, radio news. This is Bloomberg business 0:00:10.720 --> 0:00:13.960 Week inside from the reporters and editors who bring you 0:00:14.000 --> 0:00:18.319 America's most trusted business magazine, plus global business, finance and 0:00:18.400 --> 0:00:22.680 tech news. The Bloomberg Business Week Podcast with Carol Messer 0:00:23.040 --> 0:00:25.800 and Tim Stenebek from Bloomberg Radio. 0:00:26.960 --> 0:00:29.240 Well, sure's an Apple lower right now by about a 0:00:29.280 --> 0:00:32.239 percentage point. The company holding its product launch event at 0:00:32.240 --> 0:00:36.200 its headquarters today at Apple Park in Coopertino, California, right now, 0:00:36.280 --> 0:00:41.080 announcing details of the iPhone sixteen, refresh of AirPods, Apple 0:00:41.159 --> 0:00:44.880 Watch as well and more. The keynote continuing to be underway. 0:00:44.920 --> 0:00:47.200 We've also got a great live blog covering the event. 0:00:47.240 --> 0:00:50.159 I encourage everybody to check that out too. Let's go 0:00:50.159 --> 0:00:52.280 now to Ed lud Though, co host of Bloomberg Technology 0:00:52.280 --> 0:00:54.560 on Bloomberg TV. He's been at Apple Park in Coopertino, 0:00:54.600 --> 0:00:58.320 California since the wee hours of the morning. We appreciate 0:00:58.360 --> 0:01:02.120 that he joins us Now, Ed, what is one new 0:01:02.200 --> 0:01:05.160 thing that you learned today? 0:01:06.280 --> 0:01:08.800 Oh goodness, Well, one new thing that I learned today 0:01:08.959 --> 0:01:12.840 is that what's old is new. We have a button 0:01:13.240 --> 0:01:17.760 called camera control on the iPhone sixteen generation, and you 0:01:17.800 --> 0:01:20.200 think if it as something akin to the shutter button 0:01:20.200 --> 0:01:24.039 on a DSLR camera. For you photography enthusiasts out there, 0:01:24.400 --> 0:01:26.640 you know very simply, if you're holding the iPhone sixteen 0:01:26.680 --> 0:01:29.039 in your hand and you see something you're desperate to 0:01:29.080 --> 0:01:32.200 take a photograph, Bam, hit the camera control button. Camera 0:01:32.280 --> 0:01:34.600 comes up. But don't worry, Tim, You don't need to 0:01:34.640 --> 0:01:37.360 turn your hands or readjust or turn the screen boom, 0:01:37.480 --> 0:01:39.560 just hit the button again and it takes a photo. 0:01:39.920 --> 0:01:43.720 This is groundbreaking innovation. Is this, as you guys know 0:01:44.280 --> 0:01:45.480 enough report? 0:01:45.600 --> 0:01:45.839 Yeah? 0:01:45.800 --> 0:01:48.080 Is this enough to get people to buy the iPhone 0:01:48.120 --> 0:01:50.320 sixteen to upgrade from the fifteen or the fourteen or, 0:01:50.680 --> 0:01:52.560 like me, the lowly thirteen. 0:01:54.600 --> 0:01:57.200 Joking aside as I've heard them talk about camera control 0:01:57.240 --> 0:01:59.160 actually sounds like an awesome idea and I can't wait 0:01:59.200 --> 0:02:00.720 to get my hands on it and test it. But 0:02:00.960 --> 0:02:03.920 it probably isn't enough. And so you need to separate 0:02:03.960 --> 0:02:06.880 the hardware story from the software story. And when I 0:02:06.880 --> 0:02:09.880 say software, I mean AI and so these are not 0:02:09.919 --> 0:02:13.040 substantive hardware upgrades from the prior generation I've one fifteen, 0:02:13.080 --> 0:02:15.960 although there is some improvement to the capabilities of the 0:02:16.000 --> 0:02:19.560 processor in the Base sixteen. What they're talking about in 0:02:19.600 --> 0:02:23.240 real time because the events ongoing obviously, is why we 0:02:23.320 --> 0:02:27.560 need Apple Intelligence their AI suite in our lives. And 0:02:27.760 --> 0:02:31.400 very simple summary is that it basically improves the tasks 0:02:31.560 --> 0:02:34.080 that we already do on our phones each day, makes 0:02:34.120 --> 0:02:37.120 them more efficient, easier to do, rather than being some 0:02:37.200 --> 0:02:39.920 kind of wholesale change to how we interact with our 0:02:39.960 --> 0:02:40.640 mobile phones. 0:02:41.480 --> 0:02:44.440 Just very briefly, on the camera, Timmy, my husband. 0:02:45.560 --> 0:02:47.600 He's he's a photographer, a real photographer. 0:02:47.720 --> 0:02:50.000 Yeah, he actually switched from the Android to the Apple 0:02:50.040 --> 0:02:51.840 a couple of years ago just because of the camera. 0:02:51.880 --> 0:02:53.960 But add to your point, I don't know if this 0:02:54.080 --> 0:02:55.600 is enough. It's very cool, but I don't know if 0:02:55.600 --> 0:02:59.040 it's enough to sort of pull forward that upgrade cycle. 0:02:59.160 --> 0:03:00.840 I mean, tod just a little bit more about the 0:03:00.880 --> 0:03:04.679 software though, about Apple Intelligence, because the narrative is out 0:03:04.720 --> 0:03:07.720 there that Apple is kind of behind where they should 0:03:07.720 --> 0:03:09.679 be when it comes to AI. And of course this 0:03:09.880 --> 0:03:13.160 arms race that's underwayo big among all the big tech companies. 0:03:13.480 --> 0:03:16.760 How far does this event go if it all in 0:03:16.880 --> 0:03:20.680 dispelling that storyline. 0:03:21.560 --> 0:03:23.720 Well, the most important piece of news I suppose so 0:03:23.800 --> 0:03:26.240 far is that it will start rolling out in October, 0:03:26.520 --> 0:03:30.600 which confirms Bloomberg's existing reporting, And so then think about 0:03:30.680 --> 0:03:34.359 chronology of events. You know, we'll get the full details 0:03:34.400 --> 0:03:38.240 of the handsets themselves today, they'll start shipping probably by 0:03:38.280 --> 0:03:41.040 the end of the September, and you won't get access 0:03:41.120 --> 0:03:44.880 Sapple Intelligence until next month. So it's actually a slight 0:03:44.960 --> 0:03:46.680 delay in terms of like, well, hold on, I just 0:03:46.680 --> 0:03:48.880 got a new phone, but I don't yet have access 0:03:48.880 --> 0:03:51.600 to those tools. But the thing I re emphasized, and 0:03:51.720 --> 0:03:53.320 I think I just did a post in the blog 0:03:53.360 --> 0:03:56.080 that they'll put out soon, is that this isn't sort 0:03:56.080 --> 0:03:58.960 of a new functionality. A lot of what they outlined, 0:03:59.080 --> 0:04:03.760 be it photo related or task related drafting of an email, 0:04:03.800 --> 0:04:07.200 reviewing information, it's just a sort of more automated way 0:04:07.240 --> 0:04:10.280 of doing things we already do, rather than some new 0:04:10.400 --> 0:04:14.680 brilliant functional task that Generative AI has brought us through 0:04:14.720 --> 0:04:19.960 the handset. But again Apple being Apple, super heavy emphasis 0:04:19.960 --> 0:04:23.200 on privacy data security. That's something they always go back 0:04:23.200 --> 0:04:25.520 and lean into because they feel they're in a strong 0:04:25.520 --> 0:04:27.080 position there and they have a great track record. 0:04:27.279 --> 0:04:28.840 Maybe that's a good segue to talk about some of 0:04:28.839 --> 0:04:32.000 the health features that were announced today. In Cooper Tino 0:04:32.320 --> 0:04:35.039 ed give us an idea from a health perspective, not 0:04:35.120 --> 0:04:37.279 just when it comes to sleep apnea, but also what 0:04:37.279 --> 0:04:40.160 we heard about audio and ear health in the new 0:04:40.160 --> 0:04:41.040 AirPods lineup. 0:04:43.320 --> 0:04:47.000 Yes, so sleep apnea starting with Apple Watch series ten 0:04:47.440 --> 0:04:51.680 pending FDA approval, but it's close a really interesting piece 0:04:51.680 --> 0:04:54.200 of technology. You know, we don't need to the three 0:04:54.200 --> 0:04:57.080 of us go into our sleeping habits, but sleep apnea 0:04:57.160 --> 0:04:59.800 is a real thing. You know, many people listening to 0:04:59.800 --> 0:05:02.960 the pro will have loved ones that have some sort 0:05:02.960 --> 0:05:05.159 of degree of sleep ATNA. I know people that have 0:05:05.240 --> 0:05:07.640 had strokes as a result of sleep ATNA. And I 0:05:07.680 --> 0:05:10.280 can tell you that inside the Steve Jobs Theater when 0:05:10.279 --> 0:05:13.800 they confirm that function, there was real engagement with the audience. 0:05:14.080 --> 0:05:16.480 This is part of the Apple story about getting wanting 0:05:16.520 --> 0:05:19.600 to get into more healthcare services and very similarly with 0:05:19.720 --> 0:05:22.760 the current general next generation of AirPods being used as 0:05:22.760 --> 0:05:25.080 a sort of hearing aid device. You know, they gave 0:05:25.120 --> 0:05:29.080 the example in the presentation of a woman who was 0:05:29.120 --> 0:05:33.000 hard of hearing and her son speaking to her at 0:05:33.000 --> 0:05:34.760 a special event and saying like this is why you're 0:05:34.760 --> 0:05:37.280 so important to us, and using the sort of audio 0:05:37.839 --> 0:05:41.760 experience of normal hearing versus amplified hearing using the airpod's 0:05:42.080 --> 0:05:45.640 new territory in some sense for Apple, but again confirms 0:05:45.640 --> 0:05:47.360 Bloomberg Mark German's reporting. 0:05:47.800 --> 0:05:49.719 So that's ears. Let's move to the risk and let's 0:05:49.760 --> 0:05:52.200 talk about the watch. The watch is interesting, I mean, 0:05:52.240 --> 0:05:56.080 some new stuff coming there, especially with sleep apnea, but 0:05:56.400 --> 0:05:59.040 talk to us a little bit about blood oxygen sensing. 0:05:59.080 --> 0:06:01.400 This goes back to the beginning of the year. Of course, 0:06:01.720 --> 0:06:05.680 that lawsuit with Massimo. I mean, is there any sense 0:06:05.720 --> 0:06:10.160 of whether that'll affect users, Are users holding out for 0:06:10.200 --> 0:06:15.279 that or is that sort of just indefinitely off the table, you. 0:06:15.320 --> 0:06:16.920 Know, I remember that week. Well, there are a lot 0:06:16.960 --> 0:06:19.080 of noise at the time. I don't think there is 0:06:19.160 --> 0:06:21.719 that much evidence that it sort of puts people off 0:06:21.720 --> 0:06:24.440 this product and makes them look elsewhere, because it's something 0:06:24.520 --> 0:06:25.599 core to what they want. 0:06:26.720 --> 0:06:26.960 You know. 0:06:27.200 --> 0:06:31.359 The sleep apnea detection, along with other monitoring, is a 0:06:31.360 --> 0:06:34.080 big selling point for the Apple Watch. There's one point 0:06:34.320 --> 0:06:36.640 that Bloombergsy and King and I made in the blog though, 0:06:36.680 --> 0:06:41.040 that I would say the health stuff's really important, but 0:06:41.080 --> 0:06:44.000 you also have to remember what wearables and Apple watches 0:06:44.240 --> 0:06:46.680 and to all intents and purposes. It's a lower barrier 0:06:46.720 --> 0:06:49.600 to entry. Think about the price of the series ten, three, 0:06:49.720 --> 0:06:52.680 nine nine, right, and think about the price of an 0:06:52.720 --> 0:06:54.920 iPhone handset. We're yet to get the details. I think 0:06:54.960 --> 0:06:56.640 for the pro if we get it, you'll jump in. 0:06:57.000 --> 0:06:59.800 But the handset's probably one thousand dollars. So there is 0:06:59.839 --> 0:07:02.960 a consumer audience out there that can't afford the smartphone, 0:07:02.960 --> 0:07:05.080 but maybe they can afford the wearables. Low is the 0:07:05.120 --> 0:07:09.560 barrier to entry for the Apple ecosystem. It's fashion, you know, Katie, 0:07:09.560 --> 0:07:12.240 this one's for you. It's a piece of jewelry and 0:07:12.320 --> 0:07:15.880 the heavy emphasis on the materials, the partnership with themes, 0:07:15.960 --> 0:07:18.840 on the on the wrist straps. There's an audience for 0:07:18.880 --> 0:07:19.920 that out there right there. 0:07:19.960 --> 0:07:21.920 Definitely is. I have to say, though, Ed, I'm a 0:07:21.960 --> 0:07:24.760 garment gal and she's gonna take a lot to get 0:07:24.760 --> 0:07:29.000 me away from brand loyalty. But no, they're probably I 0:07:29.080 --> 0:07:32.120 like this because you know, it really communicates a piece 0:07:32.120 --> 0:07:34.400 of my personality. I'm sporty, tim. I don't know if 0:07:34.440 --> 0:07:35.520 the Apple Watch does that. 0:07:35.600 --> 0:07:40.000 She's wearing hookahs. That is true. That's not a joke. 0:07:40.080 --> 0:07:43.360 She actually is. Before we let you go, a couple 0:07:43.760 --> 0:07:47.920 questions I have about this. I was able to tune 0:07:47.960 --> 0:07:50.280 into some of the presentation as I was preparing for 0:07:50.320 --> 0:07:53.440 this show. All of it that I saw was pre 0:07:53.440 --> 0:07:56.720 recorded and very heavily produced. I mean, I'm old enough 0:07:56.800 --> 0:07:59.760 to remember when very little was pre produced, and a 0:07:59.800 --> 0:08:01.559 lot of it had to do with like Tim Cook 0:08:01.640 --> 0:08:05.240 and Craig Frederighi on stage telling you that you know 0:08:05.280 --> 0:08:07.600 you two was coming to your iPhone. How much of 0:08:07.640 --> 0:08:12.160 this is pre produced versus live demos? 0:08:12.240 --> 0:08:14.920 Honestly, I think it's really important to say that it's 0:08:15.760 --> 0:08:19.920 largely all pre produced. A really interesting question posed in 0:08:19.960 --> 0:08:26.280 the blog by Ian King is was AI used because, 0:08:26.320 --> 0:08:29.400 for example, you know, they have key executives standing in 0:08:29.400 --> 0:08:31.080 front of the Golden gate Bridge in San Francisco and 0:08:31.120 --> 0:08:33.520 chrissy Field the Palace of Fine Arts, like very well 0:08:33.559 --> 0:08:37.920 known known landmark, there are no people around them. I mean, 0:08:38.200 --> 0:08:39.880 these are places that I go almost every day, and 0:08:39.880 --> 0:08:42.280 I can tell you there's often at least five people there, 0:08:42.679 --> 0:08:45.079 more than zero, you know, if not dozens or hundreds 0:08:45.080 --> 0:08:48.040 of tourists. So that's kind of interesting. But you are right. 0:08:48.080 --> 0:08:50.040 I mean, the notable thing is that Apple has a 0:08:50.040 --> 0:08:52.600 deep bench of talent you know, there are many product 0:08:53.160 --> 0:08:56.760 leads and number two's in the hierarchy that are part 0:08:56.800 --> 0:08:59.880 of this presentation, and that's become normal in the pandemic 0:09:00.120 --> 0:09:01.520 post pandemic era for sure. 0:09:02.200 --> 0:09:05.960 Ed Ludlow, co host of Bloomberg Technology on bloom Bloomberg TV. 0:09:06.040 --> 0:09:09.120 He's got to get back to that demo happening at 0:09:09.120 --> 0:09:12.400 the Steve Jobs Theater at Apple Park in Coupertino, California. Ed, 0:09:12.440 --> 0:09:15.280 thanks so much for joining us with all the updates. Again, 0:09:15.320 --> 0:09:18.160 we do have a live blog going. It's contributing to that. 0:09:18.200 --> 0:09:19.920 We got a great team contributing to that. Do check 0:09:19.920 --> 0:09:23.400 that out on the Bloomberg terminal and at Bloomberg dot com. Well, 0:09:23.440 --> 0:09:26.280 speaking of Apple, it's worth three point four trillion dollars. 0:09:26.320 --> 0:09:28.920 It's more than any other company in the world. Twenty 0:09:29.360 --> 0:09:32.480 twenty three revenue came in at nearly four hundred billion dollars. 0:09:32.880 --> 0:09:35.680 It's about as big as the entire economy of Denmark 0:09:35.760 --> 0:09:39.800 or the Philippines. Most of the business is about iPhones, 0:09:40.280 --> 0:09:43.400 but last quarter Apple sales just from digital services reached 0:09:43.440 --> 0:09:46.079 twenty four point two billion dollars. It's more than the 0:09:46.080 --> 0:09:50.880 combined revenue of Adobe, Airbnb, Netflix, Palanteer, Spotify, Zoom and 0:09:51.240 --> 0:09:54.000 x from Elon Musk. Investors seem to have no problem 0:09:54.040 --> 0:09:56.600 with this kind of dominance, as Apples storing stock price 0:09:56.600 --> 0:09:59.280 over the past decade, it makes clear regulators, on the 0:09:59.280 --> 0:10:02.959 other hand, have some questions. It's today's Big Take, written 0:10:03.000 --> 0:10:06.680 by Austin Carr and Max Chafkin. Austin is a Bloomberg 0:10:06.720 --> 0:10:08.880 News technology reporter. He joins us from our Boston bureau. 0:10:09.000 --> 0:10:11.560 Check out their story and more from the Bloomberg Big 0:10:11.600 --> 0:10:14.520 Take on the Bloomberg Terminal and at bloomberg dot com 0:10:14.559 --> 0:10:18.040 Slash Big Take. Austin give us an idea of the 0:10:18.080 --> 0:10:20.760 way that regulators, not just here in the US, but 0:10:20.880 --> 0:10:24.640 around the world have attempted to take aim at Apple's dominance, 0:10:24.679 --> 0:10:27.160 and also described that dominance this so called Apple tech. 0:10:28.640 --> 0:10:32.600 Yeah, so the controversy comes down to how much Apple 0:10:32.640 --> 0:10:35.840 controls its ecosystem, what they will let into It's so 0:10:35.960 --> 0:10:39.320 called waldgarden, the sort of confines of its platform. And 0:10:39.360 --> 0:10:41.480 the truth is they don't let a whole a lot 0:10:41.520 --> 0:10:45.720 in that they don't regulate review and also charge certain 0:10:45.960 --> 0:10:47.839 commissions and fees on which is what a lot of 0:10:47.880 --> 0:10:50.760 developers are taking issues with. If you want to see 0:10:50.760 --> 0:10:52.800 where the market is seeing a little bit of change. 0:10:52.800 --> 0:10:55.800 It's actually in Europe with the DMA, the Digital Markets 0:10:55.840 --> 0:11:00.160 app with the European Union has put Apple on a 0:11:00.320 --> 0:11:03.040 under some pressure to actually change its ways and open 0:11:03.120 --> 0:11:06.880 up that's Apple Guard, that walled garden effect. So actually 0:11:06.880 --> 0:11:09.920 there you're seeing some pretty novel differences with how you 0:11:10.000 --> 0:11:13.199 have an iPhone in the US. Just for example, they're 0:11:13.280 --> 0:11:16.360 opening up alternative marketplaces in Europe, so you can actually 0:11:16.360 --> 0:11:19.520 download a different app store if you want a different 0:11:19.559 --> 0:11:22.600 set of experience from different software makers, like Epic Games 0:11:23.160 --> 0:11:26.280 or another called Alt Store. In fact, over in the EU, 0:11:26.360 --> 0:11:29.960 you can actually delete Apple native apps, like soon you'll 0:11:30.000 --> 0:11:33.120 be able to delete the browser Safari, the camera app, 0:11:33.120 --> 0:11:35.560 and even the app store itself, which is opening up 0:11:35.559 --> 0:11:37.960 a sort of fundamentally different experience that's a little bit 0:11:37.960 --> 0:11:40.320 more flexible and open than what we have in the 0:11:40.320 --> 0:11:42.280 rest of the world. So that's actually a good preview 0:11:42.320 --> 0:11:44.240 of what you might see on the horizon depending on 0:11:44.320 --> 0:11:46.000 how regulation shapes up in the US. 0:11:46.400 --> 0:11:48.880 And it's interesting because you can trust that with investors. 0:11:48.880 --> 0:11:52.200 It feels like potentially a case where regulators are and 0:11:52.320 --> 0:11:55.520 investors are at odds here because I don't know, Austin, 0:11:55.559 --> 0:11:58.640 do you see any signs that investors are uneasy with 0:11:58.800 --> 0:12:00.840 just how dumb an Apple is? 0:12:02.240 --> 0:12:04.400 No. I mean, I think that lock in effect is 0:12:04.400 --> 0:12:07.400 actually what ironically makes it so enticing for investors and 0:12:07.440 --> 0:12:10.560 also such a beloved company for consumers. I mean, look, 0:12:11.000 --> 0:12:13.600 the tough thing for the DJ here in the US, 0:12:14.000 --> 0:12:17.200 which filed its anti trust complaint earlier in March, is 0:12:17.240 --> 0:12:19.760 that what they take issue with the way that Apple 0:12:19.800 --> 0:12:23.439 controls its ecosystem and integrates its hardware, software and services 0:12:23.720 --> 0:12:26.560 is usually what consumers really love about it. You know, 0:12:26.600 --> 0:12:29.079 we like that it works really together if you have 0:12:29.120 --> 0:12:32.480 a MacBook and Apple Watch, AirPods and an iPhone at. 0:12:32.320 --> 0:12:32.880 The same time. 0:12:32.920 --> 0:12:36.800 We don't really quite grasp that because of that integrated experience, 0:12:36.840 --> 0:12:39.960 what it's locking out it can be a detriment to 0:12:40.040 --> 0:12:43.559 the experience itself, even if we like the Apple sort 0:12:43.559 --> 0:12:45.559 of day to day incremental updates. So I think actually 0:12:45.600 --> 0:12:49.280 today's event with AI, where they didn't really release any 0:12:49.320 --> 0:12:51.840 new AI features that they hadn't already previewed, they're not 0:12:51.880 --> 0:12:54.520 actually going to come for a few months. That's one 0:12:54.520 --> 0:12:57.000 example of the ways that perhaps they're not incentivized to 0:12:57.040 --> 0:12:59.600 move as fast and as risky and as innovatively as 0:12:59.640 --> 0:13:01.640 they had in years past, because there's not a lot 0:13:01.640 --> 0:13:03.560 of risk that I as an iPhone user and going 0:13:03.600 --> 0:13:05.000 to leave to a different ecosystem. 0:13:05.160 --> 0:13:06.880 Right, Well, let's talk about that a little bit more, 0:13:06.920 --> 0:13:09.240 because we're talking about regulators. Then we talked about investors, 0:13:09.280 --> 0:13:12.200 and you bring up the end user of course, the customer, 0:13:12.240 --> 0:13:15.480 the person who is buying into this walled garden. I mean, 0:13:15.920 --> 0:13:20.000 what is the sense there are users getting frustrated with 0:13:20.040 --> 0:13:23.000 the fact that you do have to buy into an ecosystem. 0:13:23.040 --> 0:13:25.480 You can't really buy just a product one off and 0:13:25.520 --> 0:13:28.680 then integrate it with other products from other companies. 0:13:29.840 --> 0:13:32.120 The thing is that this isn't an overnight switch. This 0:13:32.200 --> 0:13:34.520 is something that they've essentially been building out from when 0:13:34.559 --> 0:13:37.000 Steve Jobs came back and released the iMac, then the 0:13:37.040 --> 0:13:39.920 iPod and so on. You started building up that ecosystem 0:13:39.920 --> 0:13:42.520 over the course of decades, where if you have an iPhone, 0:13:42.800 --> 0:13:45.160 remember that device came out before there was an app store. 0:13:45.280 --> 0:13:47.480 Then they introduced the app store a year later. Then 0:13:47.520 --> 0:13:51.120 they introduced a lot of companion devices like the iPad, 0:13:51.280 --> 0:13:54.920 like the Apple Watch, like air pods, and then on 0:13:54.960 --> 0:13:57.640 top of that part of what makes CEO Tim Cooks 0:13:57.679 --> 0:14:01.160 Era so monumental has been this push into services. So 0:14:01.240 --> 0:14:05.960 you subscribe to iCloud, you subscribe to TV plus, fitness subscriptions, 0:14:05.960 --> 0:14:07.760 things like that, and so these are all things that 0:14:07.960 --> 0:14:10.480 add on to the experience and make it just that 0:14:10.600 --> 0:14:12.920 much easier to add a new Apple device or a 0:14:12.920 --> 0:14:15.600 new Apple subscription because that's your default, that's what you're 0:14:15.640 --> 0:14:18.600 going to want to add to. Now. That also makes 0:14:18.600 --> 0:14:21.680 it easier to escape that ecosystem. You know, once you've 0:14:21.720 --> 0:14:24.800 invested thousands of dollars in the Apple ecosystem, you're not 0:14:24.840 --> 0:14:28.240 going to suddenly overnight switch to a Windows PC or 0:14:28.280 --> 0:14:30.640 a Google Pixel phone just because they add a new 0:14:30.720 --> 0:14:33.920 AI feature. It makes that sort of mote that Apple 0:14:34.040 --> 0:14:36.800 has all the wider because it is very difficult to 0:14:36.800 --> 0:14:39.040 people not just to switch one device, but to switch 0:14:39.080 --> 0:14:41.560 their entire portfolio of hardware and software. And I think 0:14:41.560 --> 0:14:44.600 that's why shareholders really love Apple stock, because its mode 0:14:44.680 --> 0:14:47.000 is so wide. It's walled garden barriers are so tall. 0:14:47.280 --> 0:14:49.720 Austin and you and Max I love the way you 0:14:49.720 --> 0:14:52.880 start the piece that iconic nineteen eighty four Apple ad 0:14:53.320 --> 0:14:56.600 the sort of David versus Golias, you know, and where 0:14:56.600 --> 0:15:01.120 Apple has come since then and from then. I wonder, 0:15:01.200 --> 0:15:03.080 just in the last thirty seconds that we have with you, 0:15:03.400 --> 0:15:05.920 what the biggest threat to Apple is right now moving forward. 0:15:07.040 --> 0:15:09.240 I mean, I think it is sort of a feeling 0:15:09.280 --> 0:15:13.680 of incrementalism of you know, things aren't seemingly disruptive until 0:15:13.720 --> 0:15:17.520 they are being able to disrupt, until they are disrupted. 0:15:17.600 --> 0:15:17.800 You know. 0:15:17.840 --> 0:15:20.120 I think when chat ChiPT came along in late twenty 0:15:20.160 --> 0:15:22.280 twenty two, that shocked a lot of people. No one 0:15:22.280 --> 0:15:24.600 had ever seen anything like that. And here we are 0:15:24.640 --> 0:15:27.520 two years later and Apple's just getting around to rolling 0:15:27.520 --> 0:15:29.720 out its AI features, many of which won't roll out 0:15:29.760 --> 0:15:32.560 to twenty twenty five. Now, did that disrupt you know, 0:15:32.640 --> 0:15:35.000 sales of the iPhone going forward? No, there's not really 0:15:35.000 --> 0:15:37.520 a chat ChiPT phone that's out there. But you can 0:15:37.560 --> 0:15:41.200 see the risks of sort of slowly introducing some of 0:15:41.240 --> 0:15:45.000 this this innovation. You know, it has downsides for consumers. 0:15:45.080 --> 0:15:46.520 At what point are they going to say, you know what, 0:15:46.560 --> 0:15:48.520 I want something a little bit sooner. I want something 0:15:48.520 --> 0:15:49.920 a little bit faster and cooler. 0:15:50.120 --> 0:15:52.360 Austin Carr, one half of the team that did today's 0:15:52.360 --> 0:15:54.600 at Bloomberg Big take. Check it out at Bloomberg dot com, 0:15:54.600 --> 0:15:57.240 slash the Big Take, and of course, on the terminal. 0:15:57.600 --> 0:16:01.400 You're listening to the Bloomberg Business Week. Catch us Live 0:16:01.480 --> 0:16:04.520 weekday afternoons from two to five pm Eastern, Listen on 0:16:04.560 --> 0:16:07.120 Apple car Play and then brout Auto with a Bloomberg 0:16:07.160 --> 0:16:11.280 Business at or watch us Live on YouTube. 0:16:11.440 --> 0:16:13.520 Home sales in Manhattan rose to the first time in 0:16:13.600 --> 0:16:15.920 two years. This was in the second quarter of the year. 0:16:16.360 --> 0:16:19.160 This as impatient buyers who'd been waiting for interest rates 0:16:19.160 --> 0:16:22.200 to fall took the plunge. Closings of co ops and 0:16:22.240 --> 0:16:25.440 condos byke twelve point two percent in Manhattan in the 0:16:25.480 --> 0:16:27.440 three months through June from the same period in twenty 0:16:27.480 --> 0:16:30.800 twenty three. That's according to appraiser Miller Samuel and brokerage 0:16:30.880 --> 0:16:33.720 Douglas Elman Real Estate. The median price of one point 0:16:33.760 --> 0:16:36.200 one eight million dollars in the quarter dips slightly from 0:16:36.320 --> 0:16:39.240 year earlier, still though hovering near record since rate stored 0:16:39.320 --> 0:16:43.320 back in mid twenty twenty two. For an update on 0:16:43.440 --> 0:16:46.240 how things look in this quarter and forward, we turned 0:16:46.240 --> 0:16:48.880 to Barbara Fox. She's president of Fox Residential Group. It's 0:16:48.920 --> 0:16:51.480 a brokerage firm that works with buyers and sellers throughout 0:16:51.480 --> 0:16:54.200 New York City, and that is where this afternoon we 0:16:54.240 --> 0:16:57.240 find at Barbara. Barbara, how would you describe where we 0:16:57.280 --> 0:16:59.560 are in the third quarter of the year, now that 0:16:59.600 --> 0:17:01.640 we're in the final month of the quarter. 0:17:02.960 --> 0:17:06.480 Well, it's an interesting market and we can rest assured 0:17:06.480 --> 0:17:09.920 of one thing. Our market never is static. We came 0:17:09.960 --> 0:17:14.640 off of a very slow summer, very little activity, and 0:17:15.800 --> 0:17:19.760 it didn't really change prices very much. But we're now 0:17:19.960 --> 0:17:25.119 into a little bit more of an active, frisky market, 0:17:25.760 --> 0:17:27.440 one that we haven't seen in a while. 0:17:28.119 --> 0:17:31.440 A frisky market, A frisky at New York real estate market. 0:17:31.480 --> 0:17:34.280 I mean, what does that mean in terms of prices? 0:17:34.320 --> 0:17:36.760 And I mean actually zooming back from that even what 0:17:36.840 --> 0:17:39.000 do you attribute that to? Because of course rates have 0:17:39.040 --> 0:17:42.439 come down, mortgage rates, but not by that much. 0:17:44.680 --> 0:17:46.760 They haven't and we're not going to see the mortgage 0:17:46.840 --> 0:17:49.640 rates we saw before ever again. And I think people 0:17:49.720 --> 0:17:52.040 are getting more used to that. You know, everything becomes 0:17:52.040 --> 0:17:58.760 a new normal in New York. The what's happening right 0:17:58.840 --> 0:18:04.679 now is that there is very little product on the market. 0:18:04.720 --> 0:18:07.520 There's a real shortage of products. There are a lot 0:18:07.520 --> 0:18:11.000 of apartments on the market and properties, but there's a 0:18:11.080 --> 0:18:16.560 shortage of compared to other periods of time, but prices 0:18:16.600 --> 0:18:19.719 have never been higher than they are right now, So 0:18:19.800 --> 0:18:22.760 you have sort of this juxtaposition of two things that 0:18:22.840 --> 0:18:29.560 don't necessarily jive. What we really are seeing is with 0:18:29.680 --> 0:18:32.720 this increase in activity that's come up in the last 0:18:32.760 --> 0:18:36.320 couple of weeks, and this actually started before Labor Day, 0:18:37.560 --> 0:18:41.000 I think people are realizing that everybody, you know, there's 0:18:41.040 --> 0:18:43.720 a market, always an active market in New York. It's 0:18:43.800 --> 0:18:47.840 just the degree of activity. So people are thinking that, 0:18:48.040 --> 0:18:50.800 you know, it's time to start looking again, because once 0:18:51.680 --> 0:18:54.200 more comes on, the more product comes on the market 0:18:54.240 --> 0:18:57.320 and more people come into the market, the prices, it 0:18:57.320 --> 0:19:00.359 will push the prices even higher. So buyers will looking 0:19:00.440 --> 0:19:03.560 still looking for good buys which they can still get 0:19:04.280 --> 0:19:11.040 and and it's it's just interest rates probably aren't going 0:19:11.119 --> 0:19:14.240 to go down too much more than they have already. 0:19:14.320 --> 0:19:19.320 I think the UH they averaged about six and six 0:19:19.359 --> 0:19:23.600 point three five percent over in the last eighteen months 0:19:23.680 --> 0:19:26.560 or so. I'm not sure something like that, and I 0:19:26.600 --> 0:19:28.760 don't think they're gonna we're going to see interest rates 0:19:28.840 --> 0:19:32.120 much for a six percent. So people are getting used 0:19:32.119 --> 0:19:35.639 to these new numbers. People still need to buy things. 0:19:35.760 --> 0:19:39.160 They need to buy homes, and I really think that 0:19:40.000 --> 0:19:43.000 the buyer demand is going to pick up as long 0:19:43.040 --> 0:19:44.719 as interest rates don't go back up. 0:19:45.280 --> 0:19:47.560 Yeah, and of course, I mean six percent is still 0:19:47.680 --> 0:19:51.800 so high. Uh, it's not four percent historically, though, certainly 0:19:51.800 --> 0:19:52.679 better than eight percent. 0:19:52.800 --> 0:19:54.720 Yeah, and better than where things were in the nineteen eighties. 0:19:54.720 --> 0:19:56.760 That's what you know. Carol always reminded, I was. 0:19:56.880 --> 0:19:58.720 I was in the business in the I was in 0:19:58.760 --> 0:20:00.680 the business of the eighties, and we we had eighteen 0:20:00.760 --> 0:20:04.480 percent interest rates at that point. I know, it's crazy, 0:20:04.720 --> 0:20:07.280 I cannot and then they went down to two three percent, 0:20:07.400 --> 0:20:09.280 so go fig Yeah. 0:20:09.359 --> 0:20:12.080 Well, let's talk about about the price dynamics a little bit. 0:20:12.119 --> 0:20:14.639 I'm looking at some of the listings that you have, 0:20:14.800 --> 0:20:19.199 the sales you're currently representing some pretty big price tags 0:20:19.480 --> 0:20:23.879 multimillion dollars there. I mean, are you we seeing big markdowns? 0:20:23.880 --> 0:20:27.000 I mean, how are Okay, maybe these buyers are getting 0:20:27.080 --> 0:20:30.399 used to, you know, interest rates where they are, but 0:20:30.720 --> 0:20:33.800