I liked the opening music: "Got to Get You into My Life" from the Beatles seemed appropriate as the iPad hit 2M sales worldwide.
Walt Mossberg and Kara Swisher presiding; the session got off to a slow start. Initial question about Apple's market cap. Steve: "It's surreal", but it's not what gets him out of bed in the morning. Flash? Apple made a call; no-one currently provides flash on smartphones, and anyway HTML5 is the future. Walt tugged at my heartstrings momentarily by pointing out that Picnik (the wonderful photo editing tool) is a Flash app, but Steve maintained that many Flash apps are ads, and that "the hole is getting plugged real fast." (My favorite guitarist's web site is pretty much all Flash.) Moderators initiated more excursions into stories like the stolen iPhone and Foxconn suicides, but finally we get to the good stuff.
(1) Platform wars. Steve: we don't see it that way. Google "decided to compete with us" in the phone market. ("We didn't go into the search business!") iPhone was the first time carriers were told to just manage the network, while we handled the apps. He pointed out that AT&T (despite all the flak they are catching from users) "took a big leap" with Apple when they changed the rules of the game.
(2) The Tablet. Steve: we reimagined the tablet, without handwriting. "If you need a stylus, you've already failed." The multi-touch glass display actually began in-house as a tablet project, then migrated to the phone. Will the tablet save journalism? Steve: we need editorial more than ever right now. His advice to online newspapers: "Price aggressively [ie., cheaply], and go for volume."
(3) Future of the PC. Steve: PCs are a bit like trucks. Not everyone needs one nowadays, because we are no longer an agrarian society. The iPad is a magical device that has just the right blend of features for most people, and we have only just scratched the surface with apps. Software will get more powerful, and the bluetooth keyboard can be used when you want to create or edit content.
(4) Content curation. Walt: what about controversies re control of content on your devices. Steve: We have open and a curated platforms. We support the open standard of HTML5 better than anyone else. But we also provide the App store, where we disallow apps that crash, or don't function as advertized, or use unsupported APIs. We approve 95% of apps submitted within 7 days. We don't allow apps that defame people, but we took a couple of iterations to get that right, e.g., political cartoons.
(5) Kara: What do you do all day? Steve: "what I do all day is meet with teams of people." Kara: Do you win all the arguments? Steve: "No, the best ideas have to win!" Otherwise how could you attract and retain really good people? We have the same values now that we had back then, namely "build the best products for people." Why are you going into the ad business? So that developers can make money on their apps. We need to put this into the OS, not over and over into the apps themselves.
(6) Privacy. Steve: we worry about location in phones. We make apps ask the user if they want their location made available. We turn down apps that want to suck all your data into the cloud. We were "pissed off" at Flurry who used apps to track devices at Apple's Cupertino campus. We changed our TOS so that apps can't sell your data to analytics firms. At the very least, they should ask the user before sharing that information with third parties.
(7) Question time: record companies and television. Steve: record companies thought Tower Records and Best Buy were their customers! The front end of the business had to change, and marketing is now better and cheaper (direct to the customer). The problem with TV is the go-to-market strategy. People are used to getting set top boxes for free, which kills innovation. No-one wants to pay for another box, so the whole thing needs a redesign from scratch. Until then, AppleTV is just a hobby for us.
This was a wonderful opener, whose spirit I can't really capture here. You had the impression of a great mind being unflinchingly honest and not afraid to express deeply felt beliefs. (OK, so I'm a fan, sue me.) Yes, the Flash thing is a nuisance, and Apple's culture probably isn't the paradise that it's portrayed to be (what corp is?), but these guys are among the few who really know how to bring great products to market. Being at the session was worth the price of admission, as far as I was concerned.