Apple’s New Ecosystem: the Implications of Apple Pay

Apple Pay

 

 

 

APPLE’S NEW ECOSYSTEM: THE IMPLICATIONS OF APPLE PAY

Today, October 20, Apple launched Apple Pay with the release of their iPhone iOS 8.1 version of the device operating system. This new payment system is scheduled to go live with 220,000 merchants today for users with iPhone 6 or 6 Plus. I wrote about these new devices here. When the Apple Watch is released in 2015, which I wrote about here, it will support Apple Pay as well. See the list of merchants at the end of this article. *

While the iPhone and Apple Watches are innovative, I believe the real excitement is in the new ecosystems Apple is creating. Ecosystems are built around devices with software and services. This is one way for customers to enjoy using a number of Apple devices in a more easily integrated environment, encouraging them to buy more Apple products and upgrade to new devices when they come along.

Who is starting with Apple Pay?

The first was the Apple Store itself, where Apple employees were recently trained to help customers use it. The first app I updated after upgrading to iOS 8.1 was the Apple Store app. Soon followed like Panera, OpenTable and Uber. Others are jumping onboard quickly, including McDonald’s. The big questions that consumers will have is: what about security and privacy?

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Apple Watch: a New Category for Apple

Apple WatchAPPLE WATCH: A NEW CATEGORY FOR APPLE

On initial impression, some might say this seems like less of a watch and more an iPhone nano. While the iPhone 6 is an evolutionary change and larger than before, as I discussed in my last article here, the Apple Watch is a new product category for Apple with new ecosystems to go with it. I talk about the ecosystems here.

This is the dawn of a new platform for Apple, and though it’s clearly a “1.0” product shipping in early 2015, they got a lot right their first time out. Especially in functionality, this has more raw compute power and storage than any “wearable” I’ve seen. The software and controls are astounding. At two different sizes, 35mm and 44mm, there is a tension between too small that you can’t use the face, and too large to fit on the wrist. The Taptic Engine is another feedback and output system: you feel different kinds of vibrations for notifications, left and right directions, etc.  Apple provides the buyer a choice. Indeed, lots of choices: two different sizes, three different case materials or “collections” each in two different finishes, and a spectrum of different straps. Think of the permutations! Apple will create product segmentation and customization from the beginning.

Apple WatchHorologically, Apple is returning to a market it previously unintentionally de-popularized: the wristwatch. Wristwatches had replaced the older pocket watches especially during the late 19th century for military applications, but the popularity of the Apple iPhone meant people were checking the time from the device in their pocket.

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Apple’s New iPhone 6: Why you care

iPhone

Apple’s recent product launch in Cupertino was huge:

  1. iPhone 6 and iPhone 6 Plus, about which many leaks had already informed us
  2. Apple Watch, the previously rumored iWatch saw the light of day, though it cannnot be ordered until next year. Read about it in my next article here
  3. Two new ecosystems — which are the truly revolutionary part of the announcement — Apple Pay and HealthKit. I’ll tell you why these will be significant. Read about Apple Pay here

For a bit of irony…

These are the highest performing iPhones ever released. And as happens with each new iPhone announcement, a couple of days after the announcement pre-orders are available at midnight Cupertino time:

  • Both Apple and the cellular carriers anticipate greater demand than the previous release
  • They prepare their ordering systems for the increased load and staff up
  • During the midnight “ordering storm” their systems melt down faster and worse than previous years

Even Apple’s ordering site was down for almost two and a half hours. The carriers faired no better than in years past: support lines were broken and escalation was delayed or nonexistent. I’m hearing of delivery dates for iPhone 6 Plus that are 2 months out even if you ordered within the first 15 minutes.

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VMworld 2014 San Francisco: Final Day

BloggersVMWORLD 2014 SAN FRANCISCO: FINAL DAY

VMworld does something special for the Press and Bloggers, it reserves several tables near the front of the auditorium with power cords and a special WiFi feed. This makes it easy to take lousy low light photos from one’s iPhone. Having written on Day 1 and Day 2 of VMworld, on the last day we learned that attendees had attended 9,300 labs.

And they raised $248,460 through Destination GiveBack.

The last day is usually reserved for innovations, last year’s was about robots and 3D printing. This time: People Plus Machines.

Jane McGonigalJane McGonigal, Super Better Labs, Chief Creative Officer VR Game Designer and Author “Reality is Broken”

She started by sharing:

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VMworld 2014 San Francisco: Day 2, The Details

VMworld
VMWORLD 2014 SAN FRANCISCO: DAY 2

Following on the announcements of Day 1, three VMware executives filled in the details.

Ben FathiBen Fathi, VMware Chief Technology Officer

Ben started the morning with Destination Giveback, a charitable effort that involves flying paper airplanes as a part of the donation. No ice involved.

Recapped the previous day’s comment: The Brave Will Thrive. EVO and EVO:RAIL, the OpenStack distribution, the renaming of vCloud Hybrid Services to vCloud Air, the renaming of vCAC and vCOPs to vCloud vRealize.

In contrast to the World of Silos

Silos

Ben posited:

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VMworld 2014 San Francisco: Day 1, The Announcements

VMworld

VMWORLD 2014: DAY 1, THE ANNOUNCEMENTS

The largest cloud show of its kind, VMworld 2014 opened with the General Session in Moscone Center in San Francisco. 22,000 attendees from 85 countries are here. The show actually opened 2 days previously, but everyone who is going to be here is at this event. Partner Day and TAM Day were earlier and last night was the welcoming buffet in the Solutions Exchange. I’ll be at the Solutions Exchange later this week demoing in the Cisco booth Platform as a Service and Cloud Management.

No Limits is the theme this year.

Pat GelsingerPat Gelsinger, VMware CEO

started with this quote:

“The limits of the possible can only be defined by going beyond them into the impossible.”

This is one of the Three Laws of Prediction by Sir Arthur C Clarke, famous science fiction author and futurist.

Two years ago Pat stepped onto this stage to take the baton of leadership at VMware. This morning he uses the analogy of a “liquid world” to talk about the change in business:

  • Uber has a market cap of Hertz and Avis combined, with no physical assets.

He talked about Bravery:

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