00:00welcome to the a 16z podcast I'm Michael
00:02Copeland and we are here with Benedict
00:04Evans back from London and you were well
00:07outside of the Apple reality distortion
00:10field for the watch event yesterday so
00:13we want to talk about that and get your
00:16impression so benedict welcome thank you
00:22everything Apple does is interesting in
00:24a sense and it's interesting to list all
00:27of the different rules that they're
00:29breaking or challenging or all the
00:31things that they're doing in different
00:32ways I think the first thing that caught
00:36everyone's attention and of course this
00:38is the thing there was a lot of
00:39speculation about beforehand with Sir
00:41price of the gold version of the Apple
00:43watch which you know six months ago when
00:46they said there would be a gold one
00:47people saw AHA when the price of that
00:49comes out people were going to lose
00:50their minds and a lot of people did it
00:52so it's ten thousand dollars and it goes
00:54up to I think seventeen thousand dollars
00:56or something right rather extra forty
00:58volts for the extra fancy bands and so
01:01you've got a bunch of people talking
01:02about this as though they're unaware of
01:04the existence of the luxury goods
01:05business where you know people buy
01:08$10,000 dresses that you only wear once
01:10where they buy half million dollar
01:12watches and buy lots of them and pay
01:15$20,000 for a transatlantic first-class
01:18plane ticket or transcontinental plane
01:20ticket and so there's a discussion to be
01:23had around you know will people who buy
01:25$10,000 mechanical watches buy a $10,000
01:27electronic watch and do they expect it
01:30do they buy those watches expecting that
01:31they'll last are they willing to replace
01:33it I don't think you can extrapolate too
01:35much from the way this new markets work
01:36when you kind of drop a new product into
01:38it I think well you can say about the
01:42gold watch is well Switzerland I think
01:45sells about half a million precious
01:47metal watches a year and Apple is sort
01:51of selling into that market sort of not
01:53but it's kind of selling into that
01:54market they may sell a lot they may not
01:57sell many what's more in but either way
02:00you know it's kind of a drop in the
02:01ocean for Apple even if they sell even
02:03though they sell 100,000 gold watches
02:04it's kind of well so what I think what's
02:07much more interesting really for the
02:09gold watch is the effect it has overall
02:13watch in the market so that's what I
02:15want to ask you like why do it we don't
02:16you know in the Apple lineup you can't
02:19you know iPad if you wanted to but you
02:21can certainly buy this well again
02:23character again can't count the rules
02:24that you're breaking and not breaking so
02:26gold watches are a thing dull computers
02:29are not a thing and there's a gold watch
02:30and gold watches cost expensive there's
02:32there's gold in them wise Apple decided
02:35to do this you could argue is because
02:38they've lost their mind or it's a vanity
02:39project or because they can I think
02:41what's more interesting is to compare it
02:45with the Apple retail business which
02:47until they stopped disclosing it was
02:48about 10% of Apple revenue so they
02:51weren't selling stuff through the retail
02:53stores particularly most of the stuff
02:55was being sold to other channels but
02:57what retail did was it created this
02:59totally neat perception and this totally
03:01unique way of selling product way of
03:04demonstrating product and of course
03:06providing customer service and so Apple
03:08retail really was a self-funding
03:10marketing operation um it was an
03:13enormous billboard on the most
03:15prestigious shopping street of every
03:17city in the developed world and nobody
03:20else had stores that big selling that
03:22kind of product in those kinds of places
03:24no no luxury goods store no one who sold
03:27things as expensive with apples products
03:29even then how do they store that big and
03:31certainly and nobody who had stores that
03:33big had them in those kinds of places
03:34and so they broke all the rules of
03:36retail and then you look at the watch
03:38you need to think okay how does that
03:39change power people look at the 500 or
03:41the thousand dollar watch how difficult
03:43is it for samsung to copy that
03:45it's impossible if anybody ever subs in
03:47to copy that you can argue about Apple's
03:50ability to sell a $10,000 watch I don't
03:52think anybody would argue about
03:53Samsung's ability to sell a $10,000
03:55watch I think anybody would even think
03:57for a moment that Apple could do the
03:58Samsung could do that and so I think
04:00there's a Hager brand
04:01hello effect here and I think one but
04:05then I think you know that said you know
04:06one can kind of put this in a box and
04:08put it to one side because there is a
04:09much broader argument which is the watch
04:11yes there was a $10,000 won yes they
04:14might sell 10 20 50 thousand dollars at
04:16$50,000 them in a year so what fine now
04:18let's talk about the actual watch right
04:20what did we learn what do we know so we
04:23didn't learn that much that was actually
04:25new we've got a whole bunch of
04:29third-party apps which some of which are
04:32very appealing and we got the pricing of
04:36the mainstream models which go up to
04:38about a thousand dollars and frankly a
04:40thousand dollars to a Polish stainless
04:41steel watch weather wave and metal
04:44bracelet is or high-quality leather
04:45bracelet is perfectly normal perfectly
04:47par for the course for that kind of
04:48product in fact it's probably better
04:49quality than what you get if you will
04:51went to one of the existing
04:52manufacturers and I think the big
04:55question as we is really hasn't changed
04:59from six months ago when they first
05:01showed it to us which is and I kind of
05:05broke this into two parts or perhaps
05:07three parts the first is it reminded me
05:09of the iPad you looked at the iPad when
05:11it was launched and clearly you know if
05:13you wanted to buy a lightweight 9 inch
05:15touchscreen computer this was someone to
05:17get but ya wasn't actually clear that
05:19was a good idea in the first place and
05:20by extension then I was also reminded of
05:23mobile phones that if we've been sitting
05:25here 20 years ago you do look at a
05:27mobile phone and say well yeah that kind
05:29of lightweight now and they're kind of
05:30cheap and they'll probably get lighter
05:31and cheaper but am I ever actually gonna
05:33want to own one regardless of how light
05:35and how cheap it gets and it wasn't you
05:37know most people 20 years ago would have
05:38said probably not actually you know back
05:40in 2019 95 most people didn't think
05:42they'd ever have a mobile phone I
05:43certainly didn't um I certainly thought
05:45I'd never have a mobile phone and how do
05:48you fit this new thing into your life
05:49how does your life change around it why
05:51is it useful and it's not useful in the
05:54way that a mobile phone is even in the
05:56weather so we looked at a mobile phone
05:58and he said well I've already got a
05:59telephone right and it turned out that
06:00having a telephone when you're walking
06:01down the street in some random place was
06:03actually completely different from
06:04having one at home or having a payphone
06:05and it was actually really a different
06:07product than a landline and how is so as
06:11a watch a different thing well it's in
06:12your wrist in your smartphone is in your
06:13pocket and you need both and you will
06:15continue to need both for the time being
06:17because of things like battery life and
06:18space you can't put a cellular radio
06:21around a battery that can power it into
06:22something people feel on your wrist at
06:24battery but just backing up for a second
06:27battery life they're saying is
06:28yeah it depends how you use it you know
06:30you get the thing and all of your
06:32friends say wow that's cool show to me
06:33the battery will be dead in three hours
06:35if you actually use it like a kind of a
06:38normal use it looks like you'll get all
06:40day out of it quite reliably okay we'll
06:42see we'll see so but the deeper and of
06:46course the reason why you need your
06:47phone is to preserve battery life
06:48because all the heavy lifting is done on
06:49your phone or device so the question is
06:52okay what does it mean to have this
06:53extra screen other this other screen on
06:55your wrist you could argue that this
06:57means while you'll just be swamped by
06:58even more information you could argue
07:00that it's a filter that instead of
07:01pulling your phone out of your pocket
07:02every 10 minutes and reading all of your
07:04Twitter feed and looking at all of your
07:05emails you glance at your wrist every 10
07:07minutes and do I have an important email
07:09do I have a Twitter mention do I have a
07:11phone do I have something that I need
07:12that I need to see if not I put my like
07:15if so I take my phone out or I read it
07:17if not right carry on doing what I was
07:19doing so you could argue it kind of
07:21preserves you from information overload
07:23in some senses and then of course
07:26there's the thing you know what there
07:27was it reminds me of course we will
07:28google glass again Google glass didn't
07:30do anything that you couldn't do with a
07:31smartphone but you know kind of tried to
07:33do it in a different way and so does a
07:34watch but without all the kind of the
07:36glass hole problems of the sort of
07:37imposing the screen between you and
07:38other people I think there's a lot of
07:41psychology and a lot of user behavior
07:44and a lot of perception around this as
07:47opposed to pure utility and I think
07:49that's I think the most you know the
07:52fundamentally the most interesting think
07:54about this is that you know Apple is
07:56doing kind of trying to do a step change
07:59in usability and in the emphasis of the
08:05product that's to say when you went the
08:07map with the Mac you had a step change
08:10in usability of a step change in hazel
08:12about the product again with the iPhone
08:13again partially at least with the iPad
08:16certainly as compared to a PC or Mac and
08:17then the watch again it's another step
08:20in abstraction and it's another step in
08:22the importance of delight over feeds and
08:25speeds so but that sounds to me like
08:27you're you're you are starting to sort
08:29of zero in a little bit on those use
08:32cases that you're still wondering what
08:33it's going to be used for well I like
08:36the types so I think this there's a fine
08:39point in here around our these specific
08:41things that you do with it but then an
08:45awful lot of people buy watches I don't
08:48happen to own a watch just as I don't
08:50own a $10,000 watch but lots of people
08:53do and why do you buy a $10,000 watch
08:55instead of a hundred dollar watch and
08:57now it's not so other people see it
08:59incidentally that's a really easy attic
09:00analysis why are we not sitting here
09:03wearing boiler suits why have we chosen
09:05clothes like I actually yes but it's not
09:09ironic policies yes it's an ironic
09:12Berkeley boiler suit yes exactly you
09:14know if we only bought things that had
09:15very specific utilitarian use cases you
09:18know we would all live in a capsule
09:21hotel and we would all drive the same
09:23car and we would all wear the same
09:25clothes we would be living in North
09:26Korea in effect and we don't and I think
09:30the progression of the technology
09:32industry I mean one of the ways I
09:33describe this is sort of technology
09:34outgrowing tech is it it moves from
09:37selling technology products to selling
09:40things that create fill other desires or
09:43kind of other pleasures I mean I think
09:46this company we've invested in Ringley
09:48is very interesting in this sense it
09:50produces a piece of costume jewelry with
09:51a notification light that tells you if
09:52your boyfriend's phone or if you had a
09:54like on Instagram or something that you
09:55can customize yes you could put your
09:57smartphone out but it's actually quite
09:59nice to do it in this other way yes I
10:01could just wear a boiler suit but I do
10:03kind of like spending five hundred
10:04dollars on that beautiful jacket that
10:06I'm going to wear every now and then or
10:08you know spending a thousand dollars on
10:11a light instead of going to a care and
10:12buying a ten dollar light and it's not
10:14stupid to do that anymore than it's
10:16stupid to buy the $10 light you know you
10:18kind of you move up Maslow's pyramid and
10:20you think about different things and you
10:22value different things and so I think
10:24where Apple is kind of pushing with the
10:27watch is in that sense that delight for
10:30want of a better term is more important
10:32than the feeds and speeds I mean it's
10:35worth noting incidentally they would say
10:36with the iPhone they don't tell you what
10:38the clock speed is on the chip I mean
10:39they do talk a lot about the chip but
10:40they don't tell you the clock speed they
10:42don't tell you they they didn't give you
10:43numbers for the clock speed and the VAM
10:45and everything else so all they tell you
10:46really the only spec they tell you
10:48it's the storage right and the same
10:51thing for the iPad and then you go to
10:53the watch they don't tell you anything
10:55I mean they if you dig around enough you
10:58can find out what kind of Wi-Fi it's got
11:00if you really care but they don't tell
11:02you what the clock speed of the CPU is I
11:04think apparently it has eight giggles
11:05storage but you're not really supposed
11:07to care about that either
11:09and so the technology fades more and
11:11more into the background as an enabler
11:13for other experiences that are not about
11:16how fast you run this program rather it
11:18is about you lift your wrist and you tap
11:21on uber and you press yes and then you
11:24it's rather than pulling the phone out
11:26and loading the app and doing this and
11:28doing that and pressing wait
11:30it's about friction and pleasure and
11:32enjoyment as opposed to operating the
11:37user interaction model operating the
11:40user interface of for a computer program
11:42it's interesting because you know what
11:44you described Apple has done this
11:45amazing job of creating these objects of
11:47desire in the end like we all wanted an
11:50iPhone we all wanted an iPod when they
11:52came out but they've sort of bolstered
11:55the reason why you want it with all
11:57these speeds and pizzas etc like you say
11:58and all the utility now they've created
12:00this object of desire and and you know
12:03maybe it's the first sort of
12:05instantiation of like this pure Apple
12:07object of desire from the get-go hi yeah
12:10I think that's what I mean the
12:11progression that you see particularly
12:13with the iPad and the iPhone and even
12:15more than the iPhone was it it's a piece
12:16of glass that can be anything and so it
12:20is pure iPad in effect is pure software
12:22right it's not about you know you can't
12:24change the ports there's no USB socket
12:26there's no SD card you're not supposed
12:27to think about that at all
12:29it's supposed to be literally just a
12:30piece of glass a sealed piece of glass
12:33that can be anything when it lights up
12:35and the watch I think is same but it's
12:37just taking that that much farther
12:38further it is just a piece of glass now
12:41these are the things that that piece of
12:42glass can become but it doesn't have to
12:44have a micro USB port on it or an SD
12:47card or even necessarily a camera
12:50although you know a camera might come I
12:52mean who knows maybe maybe not but it is
12:55about a little magic piece of glass that
12:57can be anything and primarily what that
13:00little magic piece of glass is supposed
13:02to do is be pleasing and be delightful
13:04and be an enjoyable thing to own and the
13:07world is full of enjoyable delight
13:10for pleasing things to am that you don't
13:11need you know go into any you know home
13:14store lifestyle store and look at all
13:16the things that you could spend money on
13:17that you name need but people like so
13:21I'm looking at you right now and you
13:23have a an iPhone 6 in front of you on an
13:26iPad and I see you carry around a laptop
13:28but like you said you do not wear
13:30watches you are an inveterate non watch
13:32where do you think you're going to start
13:36wearing a watch or this watch edges well
13:39if I didn't if I wasn't sort of
13:41professionally obligated to try it out
13:42for a while you mean I don't know
13:45it is a pleasing thing in a way that the
13:48existing smart watches do not appeal to
13:51me as an object there are at the same
13:56time there was housing dilemma can occur
13:57watches that I've sort of looked at for
14:00the last two or three years and so I
14:01might get one I might not maybe I'm not
14:04sure think about it well I would I buy
14:09one of these if I wasn't again you know
14:10sort of professionally obliged to get it
14:12I don't know but I also don't think
14:15that's really the point because you're
14:19what you also I think we're also seeing
14:20is this kind of expansion into areas
14:23where it's not something that everyone
14:25will have it's just a delightful
14:27pleasing product right that many people
14:30will have right well it launches at
14:33least in the US April before the end of
14:36April of April so we'll start seeing
14:38them in the wild and Benedict I will
14:40start checking your wrists around the
14:42end of April to and and we'll talk more
14:44about what you're using it for and what
14:45you're seeing in it and and whether you
14:47like it sure thanks Benedict
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