Extra Crunch offers members the opportunity to tune into conference calls led and moderated by the TechCrunch writers you read every day. This week, TechCrunch Editor-in-Chief, Matthew Panzarino, offered his analysis on the major announcements that came out of Apple’s keynote event this past Monday.
Behind a series of new subscription and media products, Apple has set the stage for one of the largest transformations in the company’s history. Matthew touches on all of Apple’s major product initiatives including Apple’s new credit card, its push into original content, its subscription gaming platform, and its subscription news service, which features Extra Crunch as one of the debut publications.
“I don’t think many of the things that Apple announced here, on an individual basis, are earth-shattering. I think it shapes up to be a really solid, nice offering for people with some distinct advantages but at the same time it’s not breaking huge molds here. I think the same thing applies across all of the offerings that they put out there.
I just felt that together, it’s solid but not scintillating and we need to see how they develop, how they launch, and then what they do with these platforms…
…Seems relatively straightforward. However, some of the stuff people have glossed over is very intriguing.”
Matthew goes into more detail on why he didn’t view the announcements as individually earth-shattering, and why he sees compelling opportunities for Apple to position its offerings as a symbiotic ecosystem. He also goes under the hood to discuss some of Apple’s overlooked competitive advantages in media and to paint a picture of how Apple’s new product lines might evolve in the long-term.
For access to the full transcription and the call audio, and for the opportunity to participate in future conference calls, become a member of Extra Crunch. Learn more and try it for free.
Danny Crichton: This is Danny Crichton, Executive Editor of Extra Crunch. Thanks everyone for joining our conference call today with TechCrunch Editor-in-Chief, Matthew Panzarino. Panz spent the day at the Steve Jobs Theater in Cupertino yesterday to take in all of Apple’s new subscription options including its media, television, and movie options, as well as its news subscription, which Extra Crunch is proud to be a debut member.
If some of you have some more questions around Extra Crunch’s participation, that’s something we can definitely address. But I want to open the floor to Panz. Give us a sense of what the feeling in the room was like? What was going on?
Matthew Panzarino: All right, Danny. Plenty of Hollywood folks and then actors, showrunners, producers, some of them one and the same. There was a lot of actor-driven content there, performer-driven content and of course, Oprah was in the room, so the vibe was significantly different than any previous Apple event.
One of the things that stood out, even before the event, on Twitter was that some developers and software sorts were not as excited for this as have been for almost any other Apple event. Well, that’s probably a good sign. This particular event isn’t really for developers. There’s a reason that all of this stuff is being announced now versus at WWDC, which is a significantly different audience and has a different purpose.
Danny Crichton: There was a pretty wide range of announcements. From our world, it was actually a huge focus on us, at least from the Apple News side of things. But for the developers, there wasn’t really much of an API that I saw, or really any kind of a connection with developers.
Matthew Panzarino: Yeah, definitely not. There certainly wasn’t a developer angle, or an angle for people to say, “Hey, there’s a new opportunity here for me to take advantage of an endpoint or any technology to grow a business or to start a business.”
A lot of times at WWDC, that’s one of the angles that TechCrunch the publication focuses on –“What are the opportunities here?” “Where are the toe holds for new businesses or for existing startups to grow or to find new avenues of growth or consumer engagement?” Basically, “how can we use these big platform moves as an advantage or how can we defend ourselves against them?” That’s the kind of lens that we typically look through and the way our audience looks at it. But, there wasn’t much of that for this event.
Certainly, Apple Arcade was one of the more developer-centric of announcements. We can run through all of these announcements briefly but let’s just start with Apple Arcade because I think it probably has the clearest and simplest reason for existing so to speak because I think that plenty of the other items had lots of question marks.
But Apple Arcade is clearly aimed at counterbalancing this trend towards free-to-play being the only viable business model for game developers in the App Store. Games are expensive to produce; they need a revenue stream that is relatively predictable and in-app purchases —which Apple introduced and or popularized on the App Store. Really the App Store created the cancer that Apple is now trying to cure, which is this idea that the only viable business model for a game on the App Store is to publish free and then sell people on in-app content or upgrades.
The Apple Arcade announcement is meant to sort of blunt that blow on the revenue stream of the industry and offer a little bit of breathing room and air for developers to say, “Hey, I can publish on this platform, get a share of the subscription directly and not have to work my game idea around this concept of in-app purchases.”
I think there’s a certain class of game that this makes sense for, which was certainly typified by some of the games they showed up on stage. Narrative driven games from either large or small publishers, games that have unique or interesting concepts that sort of push the boundaries of what games can or should be but utilize technology in new and interesting ways without necessarily having the pockets with which to insert pay to play mechanics.
That certainly is the initial cadre of games that Apple’s going after and I believe that is, judging from my discussions and from what I’ve learned, that’s what they are trying to do. Create an environment where, in a few years, games on the App aren’t just all in-app purchase based. That’s what the purpose of Apple Arcade is, and I think they actually have a pretty decent chance of pulling it off. I’m actually relatively hopeful about the quality of games on the store and about the opportunities for people creating games and for those creating mobile games with very unique or interesting interaction mechanics or storytelling. I’m pretty positive about that particular announcement.
Danny Crichton: How do game developers interact on a product like this where there might be cross-platform? How do they integrate with arcade versus something in the Android world or broader?
Matthew Panzarino: Obviously, these games will not be available on Android. The exclusivity arrangements, the way that I understand them judging from my discussions that I’ve had, work where these titles are going to be exclusive on IOS devices, on mobile, Macs and Apple TV and subscription services. So the phrasing is very, very careful. If you look at Apple’s onscreen presentation, if you look at anything they’ve said about it, the phrasing is very careful. One example is going to be available on the Switch as well. But the Switch is not, according to Apple, considered a mobile platform and it’s not considered a subscription platform obviously because you’re going to be purchasing it outright on the Switch.
But games that are offered via the service cannot be offered for pay on the Apple App Store. So you cannot buy an app that exists or game that exists inside the subscription service on the App Store. They are not going to be available for purchase, they’re going to be exclusive to the subscription service and you cannot play them on any other mobile platform or subscription platform. So for instance, they couldn’t be offered for free on PlayStation Plus. However, it seems clear that they should be able to be offered on a console.
The switch would be the most likely culprit for most of the games that you’d see as an overlap being launched on the PlayStation Store for instance. It might make sense for some of these games, but probably not the vast majority, but that’s the way it’s going to play out. The big losers here are Windows desktop and Android in terms of where these games will show up.
Danny Crichton: Got It. Then Apple had a bunch of announcements around TV.
Matthew Panzarino: They did. They had an interesting segment-based introduction around TV. They have the Apple TV app which is being updated. This kind of dovetails with the other TV announcements, but it is separate.
The Apple TV app is being updated and then it’s being shipped on Roku devices, smart TVs and Amazon Fire TV. There are some question marks about what exact content will be available across all those platforms and whether all of the content will be available across all the platforms in the Apple TV app. But the fact that it’s being shipped cross-platform, clearly because Apple is thinking about the Apple TV app as an outrigger to their onboard system lock in, allows people to see what Apple has available to participate in it and take advantage of those offerings. If they’re going to basically start up a channel store, which they did with the Apple Channels offering, then they’re going to want to have as many endpoints as possible to sell those channels to people.
You have basically three announcements; you have Apple TV Channels, the Apple TV app and then Apple TV Plus. And Apple TV Channels and Apple TV Plus are different even though they seem interrelated, but Apple TV Plus plain and simply is Apple’s original content. That’s the content that they’re producing. That’s why they had all these stars in attendance to present them, notably with very little footage shown. I know from personal knowledge that these shows are in the process of being shot but clearly fairly early. There was a sizzle reel of all the shows shown at the end, but no individual trailers were shown for each of them, which some people raised quest marks about.
But I think that there’s plenty of air between now and Fall when Apple TV plus is supposed to launch. So that basically gives them a long tail of publicity where they can continue to kind of produce and push out trailers to build buzz over time.
By far, by the way, the biggest question that I got afterward and on Twitter was why? Why did Apple announce this stuff now when it’s not ready? Why are they doing this? I think there are a couple of very simple reasons. There’s one: there’s an operational reason — which is these industries very famously leak like a sieve so if they’re going to be leaking and leaking and leaking, they might as well get their messaging out at their time.
Then the other reason showed up in my inbox this morning as I expected, which is all of these analysts reports that are presenting up targets for Apple. They need to telegraph that they’re taking services very seriously so that all of these analysts are looking at Apple’s next quarters based on this increase in revenue.
I think Canaccord put out a report this morning saying that they expected Apple to go to $230 from $180, which is fairly significant and is basically because they’re predicting that the growth of the services revenues will outstrip the overall growth of Apple as a company. They expect this to be a growth segment for Apple. These announcements clearly hit home with the audience at Apple, and hit home with Wall Street, to put it simply.
I think consumers are still questioning whether or not they’re going to want to watch this stuff. I think a lot of it is going to come down to the trailers, and then to the buzz that comes over the next few months to see how consumers are going to be responding to this original content. But that’s why they did it — they wanted to get the news out and they wanted to build buzz and then they of course wanted Wall Street to take notice that they’re kind of making a strategy shift and hopefully it builds confidence that they can actually make that shift.
Danny Crichton: Well, let’s go through two more segments. Talk about news and buzz. We still have the news component of their announcement. Let’s talk a little bit about news and the Apple Card and then we’ll open up for questions. On the Apple News front, what’s going on there and how are we participating in it?
Matthew Panzarino: So Apple News Plus is their subscription service for news outlets. There are a handful of news outlets participating, including the Wall Street Journal, The Skimm, I think you have Mag, a couple of others and then of course TechCrunch.
A percentage of subscriptions gets taken by Apple, a percentage of that is shared with publishers and then the subscribers are able to view all of the subscription content or content that is behind a subscriber paywall in the Apple News app. The way it works for a TechCrunch, for example, is that you open the Apple News app, you tap on the TechCrunch tab under sources and then there’s a tab of Extra Crunch content that you can only access if you’re an Apple News subscriber. The Apple News Plus section of the app currently and very interestingly is magazine only essentially.
The subscription portion of the news providers is under their section of their apps, so you’re reading TechCrunch and you can access the subscription and non-subscription content there. If you tap on the Apple News Plus tab in the Apple News app then you end up pretty much with our magazine, which is an interesting choice.
I think there’ll probably be some playing around with that format. I think the magazine’s make a big splash there and they kind of wanted that initially, but I don’t doubt that there’ll be some tweaks to the overall format. It’ll be interesting. I certainly would like it. I’d like it if our content, in addition to getting algorithmically fed to each individual on their home feed which will happen theoretically, especially if you’re a subscriber and you read TechCrunch content, but I would like it also to show up as a subscription offering in their subscription tab. We’ll see whether that happens or not.
The magazine offering was interesting. Some of them are really strong. Nat Geo, for example, looked amazing. Some of them were basically PDFs and then some magazine publishers were basically shipping mobile webpages, which doesn’t look great at all, so it’s a mixed bag still on the magazine front.
Some of them do look pretty damn fantastic. The opportunities for people to do interesting things with animated covers and beautiful layouts are certainly there and are typified by a few of the offerings but certainly a vast majority of them still aren’t yet offering anything really that great. We’ll see how it works out for us. We definitely think it was a good opportunity for a publisher like TechCrunch. We’re fairly unique in the offerings there, there’s a lot of culture and basic business new stuff but certainly no other startup publications so for us it was an easy choice to try this out. Lyft wasn’t too hard to get integrated and everything worked pretty smoothly. So for us, it’s a good bet. We’re excited to see how many people take up the subscription service and whether it affects us positively in the long run but so far we’re pretty hopeful. We’re happy to be a part of the project.
Then the final part is the Apple Card, which is interesting and certainly affected Wall Street’s view of Apple. I’m interested to see how it affects regulators’ views of Apple and I think there’s going to be some necessary critical views of Apple as a conglomerate organization. Where it serves up credit cards, it serves up apps and App Store stuff that has subscription services — It’s looking pretty big and bulky. I’m interested to see how the EU looks at it.
But as a consumer, I think the card is good-not-great as far as the offerings go. It’s clean and simple and it has three different levels of cash back depending on what you’re purchasing. Obviously using Apple Pay on Apple devices is the highest percentage of cash back but then it kind of goes down from there. It is a daily cash back, which is actually fairly unique amongst other cards, similar to Amazon’s offering, but fairly unique. It’s not as much cash back as some other cards and it certainly isn’t as many points per dollar, so to speak, or as many rewards as many of the better rewards programs cards like a Chase Reserve for instance. But those are only really great if you’re the kind of consumer that utilize those services, whether it be travel or hotels or that sort of thing.
I think it’s a pretty darn good offering for an opening gambit for Apple and it’s a clean and simple offering that offers some additional benefits on the security side — especially when you’re talking about virtual payments or Apple Pay payments because card present transactions are fairly well protected against fraud and are fairly well protected with Apple Pay. So I think there are some interesting offerings, I think it’s going to intrigue the casual users who aren’t necessarily points magnates in Apple’s billion-plus device pool that they have to choose from. We’ll see how it works out long term.
Danny Crichton: Thank you. We’ve talked about a number of announcements so I would love to open up to questions from our audience.
Caller Question: Can you help us situate what this means with Apple taking that step into offerings? Help us situate that company in the larger environment including Netflix or HBO, even a CBS All Access, et Cetera
Matthew Panzarino: Yes, I don’t think that it’s actually a one-to-one competitor of Netflix as many people either assumed or sort of argued for at first. I think it’s a loading funnel for Apple’s other services. For the channel services, for obviously purchasing and subscribing to iTunes content in the Apple TV app. The value add is a little too strong a word. They’re spending a lot of money for a value add but I think there are some interesting things going on here.
The context in the industry is that Netflix of course, has been spending a lot of money. They’re overspending a lot of money. They’re overspending on a lot of content, or have been for a long time, in the war with Amazon just to build out their body of work.
However, Netflix does not necessarily have a stellar reputation in the buyer community, or the seller community I should say, in Hollywood when it comes to taste because with Netflix it’s all about the data. If they see that their viewers watch crappy rom-coms with very obvious plots, that’s what they will fund. The things that they are funding are based on data, which is a double-edged sword. They can say, “Hey, this is what people really want to see” and that’s great. You can definitely fund things that people want to see and they’ll watch them, rather than funding things that people don’t want to see. It’s certainly not business from a business perspective, but the taste aspect of it sort of runs counter to the data aspect of it.
While I was at the event yesterday, I was talking with some folks who were milling around the floor beforehand in the atrium above The Steve Jobs Theater. I was talking to some showrunners who were working with Apple and building out production and the theme is really that Apple has good taste. That they are spending a lot of money and they have deep pockets. People love to get a lot of money for projects so that they can have great effects and great casting and all of that stuff. That’s great, they’re happy to have tech companies spending money.
Some of them even remarked that it was their first time at the Apple campus, and they were absolutely blown away by the way it looks and feels. The way the company obviously takes design, artists and creators very seriously. And so I honestly think that Apple has an edge here that many people overlook, which is that Hollywood actually thinks Apple has good taste, whether that’s from the executives they hired or from their overall reputation as a design-forward company.
And remember, every one of these Hollywood creatives has multiple Apple products on the desk and in their pockets and so they’re very familiar with the company from the perspective that these things help them get their work done. But they’re also willing to ascribe to Apple, whether this is true or not, this idea that they have better taste. In addition to money, it’s one of the reasons they were able to get so many high-level creators on board to start with and I think that’s an interesting advantage that Apple has. From here on out, I am very interested in seeing the wave-two folks that have the ability to make mid-level, mid-budget with really creative ideas that are unable to get funding in the current environment which really does not serve non-sequel, $10 to $20 to $30 to $40 million or even $50 million movies very well.
There’s just not a lot of market for that in Hollywood right now. People want sequels, they want big bets, big budgets and big returns or you’re relegated to indie status. There’s just not a lot of market for mid-range movies that tell interesting stories and I think there’s an opportunity for Apple to sort of own that space.
Danny Crichton: Why didn’t Apple start to acquire companies? Do you think they really felt that they could bring a unique perspective to the acquisition of content, whether on the media, TV or news side? As far as I can tell, there was the Texture acquisition and that was basically it.
Matthew Panzarino: I’m interested in what happens to Texture by the way. I don’t know what happens there. But yes, it’s a fairly light re-skinning of Texture so far. I have a feeling it’ll get better, and it’ll get more robust as they build and tweak it over time. There are certainly indicators of that. But yes, that’s what they did here- they shipped the re-skin of Texture.
Danny Crichton: When it comes to the media side, why didn’t they buy a studio? Why didn’t they go and acquire a large production company which was already producing content?
Matthew Panzarino: That’s an interesting question. Why didn’t they buy Netflix is also a question. I think people assumed they weren’t going to buy them because of a cultural mismatch or because they didn’t see how it would align with Apple’s “build it ourselves” mentality, so I think that’s why they did it. To one degree, they didn’t feel that any existing culture would mesh well with the culture that they’re trying to build. There is an additional subtext here of dealing with the meshing of the two, either on studio lots or be it on negotiations or be it with ongoing productions or even promotion aspects of these projects.
It is going to be very, very intriguing to see the way these two worlds mesh together as Apple has a very, very strong and unique viewpoint when it comes to promotion. When it comes to process and all of that. And then, of course, creatives have their own process. And Apple has made a lot of noise about respecting creative process and respecting the way these creators want to build and make and run their shows, but I think there is some sort of meshing of the two worlds. For the most part, it’s been relatively smooth, but there has been some gear grinding there between Apple’s idea about how to promote these things and how to run them and the way Hollywood has always done them.
But I really don’t feel that you’re going to create any massive shift or change in the way that projects get funded or created in the pipeline without two big things: One, an enormous pile of money, and then two, a certain amount of Zeitgeist that Apple has. This cache that it has as a design forward company. Its ability to set the tone. It has of course a massive amount of consumer end points that it can use as a selling point to get people on board. There’s a reason that Oprah’s screaming “a billion pockets y’all”.
It is certainly an intriguing mixture. There are very few companies on the planet that could even attempt something like this so I’m glad that they’re doing it. I think the reasoning for doing it is almost less important than the fact that it’s happening because once it happens, it takes on a life of its own so that will be interesting.
Danny Crichton: How do you feel the transition to services is going to take place? This is a huge bet for Apple, right? This is arguably one of the most important transformations the company has ever undergone, which is moving not exclusively away from hardware to services but complimenting hardware with a services revenue component.
Did you, at the end of the day, feel that this was a compelling set of offerings that is going to allow them to do that or was it sort of, “God, it’s really, really early and we’re just going to have to see?”
Matthew Panzarino: I think it’s pretty straightforward in terms of the offerings and how “good” they are. They’re good, they’re fine, they’re not unique, they’re not incredibly compelling.
The Apple Card, for instance, has a lot of really cool things about it: the on-device dashboard, the focus on helping people pay as little interest as possible and to manage their spending, to be able to interface the gorgeous physical card with the advantages that Apple Pay has in online and physical Apple Pay transactions as far as security goes. There are a lot of advantages there. But the interest rates are 13% to 24%. This is a fairly standard business relationship. Sure, no fees but I have other cards with no fee too. I don’t think many of the things that Apple announced here, on an individual basis, are earth-shattering. I think it shapes up to be a really solid, nice offering for people with some distinct advantages but at the same time, it’s not breaking huge molds here.
I think the same thing applies across all of the offerings that they put out there. Apple TV Plus is original content, right? Original content has been created by tech companies before. Apple Channels is the same thing that Amazon offers in the Prime App. You have Apple Card, which is the physical card, which is beautiful, but other cards they’re metal, right? Apple Arcade is probably the most straightforward, unique and strong offering that Apple is making here. They have one of the largest game stores on the planet, so it makes a lot of sense for them to try this. Then the News is a subscription bundle for people to subscribe once and get a bunch of different things and it will remain to be seen whether that has long term effects on the news industry.
I just felt that together, it’s solid but not scintillating and we need to see how they develop, how they launch, and then what they do with these platforms. So creating this environment where they have Apple TV Plus and they have a bunch of original content and they’re shipping that out there — fine, okay, great. Seems relatively straightforward. However, some of the stuff people have glossed over is very intriguing. Like Oprah’s Book Club — she mentioned that she’s bringing the Book Club to Apple platforms. What does that mean? Obviously, it means book sales, it means exclusivity in terms of “Hey, we’re going to launch the new book and talk about it on Apple platforms.”
There’s video content attached to that because she can shoot video content to all of these front-end people who have subscribed to Apple TV Plus. They can get discounts on the books, they can integrate author discussions and videos, they can integrate discussions that Oprah has about the books with the audience members. They also mentioned that they would stream them live to Apple Stores. So you have all of these Apple Stores around the country streaming live discussions, maybe even taking questions via device from all the stores. There are very interesting things that Apple can do on a multi-platform, multimedia level that would be very intriguing to a creator.
I am very interested to see how that part of it develops. The original content stuff ‑ Cool. It’s either good or it’s not. Apple’s obviously has a lot of good people and it’ll be fun. Maybe a couple of the shows will get people to say, “You know what, I’m going to subscribe just to watch this because I love Ron Moore, I love Oprah or I love Kumail Nanjiani or whatever.”
I just think that there is going to be a very interesting additional layer to this stuff that has yet to be announced between now and the fall, or that I hope anyway, shows Apple leveraging the unique values of their platform and the unique position that they have to provide some different interesting avenues for creators to either interact with people to tell interactive stories.
Danny Crichton: If anyone wants to ask questions, feel free to go ahead.
Caller Question: Hi, Matthew. I have a quick question for you. When we talk about these types of collaborations between major content individuals who Apple is developing with — they have their own massive audience reach, like Oprah. When you look at the massive audience opportunities on a platform that Apple provides, what types of problems do you foresee in terms of integrating? Obviously, you have Netflix who’s willing to spend and invest in their own types of content. What types of problems are there for the content creators themselves trying to collaborate with Apple and trying to create these unique experiences, while also not ignoring their existing customers and viewers?
Matthew Panzarino: I think that it’s certainly different. There have been opportunities to create interactive and interesting content stuff on a variety of platforms since multimedia started doing this. Prince made an interactive CD before anybody even knew what CD-ROMs were, right? This stuff has been going on for a long time, I just think that there is a differentiation factor now in terms of scale, in terms of these platforms being in everybody’s pocket and being accessible obviously with broadband connections and things like that. I think that the barriers will often crop up in sort of the ideation of what can be done and Apple’s willingness to kind of go there with these things, mixed with the creatives desire to do as wild thing as possible.
As you have Apple, which inherently is a relatively conservative company on the services front, now with an opportunity to be less conservative and more aggressive on creating interactive multimedia and interesting experiences across all of their platforms that don’t necessarily fit into a framework. Apple’s used to creating frameworks and then plumping things into that are very similar.
It’s very much the tech company way. You create a framework for something and then create additional experiences within that framework that are essentially templatized in order for you to scale them. But true creative work doesn’t really work that way, so I’m interested to see how they work within this idea that you have to create individual frameworks and then recreate that thing over and over.
Then also this other opportunity in this new world of, “Hey, this show could have these very interesting additional elements,” beyond just, “Oh, I log on and I watch it.” But this next show may not use those same ones as the others or wants to do something different. It may want to do something unique and clever to leverage the technology that Apple has at its fingertips, so it’ll be interesting to see that process unfold.
Danny Crichton: We’re getting to the end of our time. Matthew, was there anything deeply missing from the event? Was there some component that you’ve been following for a while that just didn’t show up today?
Matthew Panzarino: Not really. I think a lot of this stuff had been anticipated, to some degree. I think that pricing for some of the services like Apple TV Plus being absent was annoying to a lot of people. The basic answer I got was that pricing isn’t ready. The feel, in general, was that Apple was just like, “Let’s just talk about this now so that we can get it out there where there aren’t a lot of additional leaks and rumors and all of this stuff. We can get our messaging out.” But yet a lot of the business aspects of it, they’re not quite ready to announce.
I think that’s probably the biggest missing piece that most people wanted to know that gives people a value structure. I think at a basic level; you can interpolate from the other offerings in the market. There’s no way they’re going to get away with charging more than eight to $10 bucks for a video service like that. Apple Arcade probably has got to come in around $10 bucks. I would have a hard time thinking it would come in higher than that. I don’t have any information on it. It’s just logical.
I think the big thing to watch long term will be the bundle price. My prediction is that they’re going to bundle these items together and then offer between a 10% to 20% discount on the bundle. A soft bundle of all of these items that comes together and says, “Hey, if you want music and games and all of this Apple TV Plus content, you can be a subscriber and it’s only going to cost you X versus Y.” And that discount will be somewhere around 10 to 20%.
I think that will make it a more interesting, compelling offering when you bundle it that way together. What would be really compelling would be to also bundle some of the channel content in with that but once again, that’s a problem they’ve been trying to crack forever. And I don’t know if the providers would be willing to do that and just act as another slice of Apple’s larger bundle.
Danny Crichton: One final lightning round question — or maybe I should say USBC round question — AirPower, where is it?
Matthew Panzarino: The thing that I’ve heard about AirPower have mirrored what I started hearing right after AirPower was announced but hadn’t shown up for a couple of months and what has since been reported publicly a lot which is that they have design issues. That they had hardware issues related to heat, a lot of them because there are three 3D coils that project all on multiple axes rather than a typical flat coil, which has just a minimum projection. Here you have to jam three of those in there, charge three different devices, do a lot of power management and that they were having issues with heat. Hopefully, they’ve got those sorted out. Obviously, they shipped the AirPods with the charging case without AirPower, which is not ideal, and I doubt they wanted to do that. Hopefully, we’ll see it soon.
Danny Crichton: Well, with that, we’ll close out this conference call. Thank you everyone for joining us. Thank you so much for being an Extra Crunch member, and we’ll schedule another call in a week, so we’ll hear from you again. Thanks.
Matthew Panzarino: Thank you.