7:58PM And that's that! Time for dinner! Thanks for reading!
7:57PM Q: In the phone area you were able to partner with a carrier... would you do that with TV?
A: Well then there's a problem, providers are local... it's a Tower of Babel problem...
Kara: Everyone, Steve Jobs!
7:56PM Steve: So all you can do is ADD a box to the TV. You just end up with a table full of remotes, a cluster of boxes... and that's what we have today. The only way that's going to change is if you tear up the set top box, give it a new UI, and get it in front of consumers in a way they're going to want it. The TV is going to lose in our eyes until there is a better go to market strategy... otherwise you're just making another TiVo.
7:54PM Q: Hi, I'm from Hillcrest Labs... do you think it's time to throw out the interface for TV? When will Apple do something there?
A: The problem with innovation in the TV industry is the go to market strategy. The TV industry has a subsidized model that gives everyone a set top box for free. So no one wants to buy a box. Ask TiVo, ask Roku, ask us... ask Google in a few months.
7:53PM Steve: These products are really exciting...
Okay honestly, we don't think Steve has an answer for this, but we can PROMISE you that he thinks the devices are awesome.
7:52PM Q: Games are huge. I built my company around that idea. What is your vision for gaming on all of the new devices? I have some suggestions...
A: Clearly iPhone plus iPod touch have created a new class of gaming. It's a subset of casual gaming. But it's surprising how good some of them are. They're almost as good as console gaming in terms of graphics. Console games the software is $30 or $40 a game. It's cheaper on iPhone, so the market has exploded.
7:50PM Q: I bought the movie Up on DVD, it had a digital download. I put it on my iPad. I hooked up my VGA adapter and tried to play it... but I couldn't because of HDCP. Can you tell me how you're helping with this?
A: We didn't invent this stuff...
Q: But you did deploy it...
A: Well the content creators are trying to protect this stuff, and they're grabbing at straws. Sometimes they grab the right ones, and sometimes they don't. If we want access to this stuff, we have to play by some of their rules. I feel your pain.
7:48PM Q: We're excited about interacting with your content on the device, but you don't give anyone access to the file system. Any plans to do that?
A: There's a lot of things we're working on... we should chat.
7:47PM Q: Steve, we love our iPhones... but our concern is that we can't make a phone call on it. Is someone working on that?
A: Well, we're talking about it. You can bet we're doing everything we know how to do.
Q: Can we expect something soon?
A: I'll tell you what I'm told -- (LONG pause) -- to make things better, people reallocate spectrum, and they do things like increase the backhaul, so they put in gigabit Ethernet instead of T1... things get worse before they get better. If you believe that, things should be getting a lot better soon!
A: I'm told that a lot of places are getting better certainly by the end of this summer.
Kara: And if they don't get better?
Steve: Then they won't.
7:45PM So... Steve cut off the guy asking a question about tethering and wireless sync...
Steve: You're asking about sharing your content... I think we need to do better on that.
Walt: Anytime soon?
Steve: We're working on it.
7:43PM Steve: I think that is changing a lot. I even think you'll be able to watch a first run movie before it hits theaters... if you want to spend a bunch of money.
7:42PM Steve: We want to let people watch whatever they want, when they want. That's what needs to change.
Walt: When is that happening?
Steve: It's happening now.
7:41PM Q: Hi there, I'm one of the owners of Village Roadshow pictures... can you put your Disney hat on for a moment? As a producer of films, we've made a great business of forcing the consumer to come to us, with commercials, making them pay for movies... how do we preserve the value of the content, and make it easier for people to get it?
A: The opportunities are huge for content creators... as an example, the way that we market movies is changing. Now we can reach that audience much more effectively. When we went to music companies, we said who is your customer... they said Target, and Best Buy -- they thought the retailer was the customer. What changed in that industry was the front end, the distribution and marketing was able to be done in a much more effective way, going right to the end user.
7:38PM Steve: But you can't get info off of our devices and turn around and sell it. That you can't do... is that clear?
Q: It is, but there is vital info there that could make apps better...
A: That's true... but there's no excuse for them not asking customers if it's okay to send that data. We're willing to talk to some of these people when we calm down... but it's not today.
7:37PM Q: You changed your TOS on analytics -- do you want to own that for developer's data?
A: Well we learned this really interesting thing. Some company called Flurry had data on devices that we were using on our campus -- new devices. They were getting this info by getting developers to put software in their apps that sent info back to this company! So we went through the roof. It's violating our privacy policies, and it's pissing us off! So we said we're only going to allow analytics that don't give our device info -- only for the purpose of advertising.
7:35PM Q&A time for Steve!
7:34PM Walt: But you're moving into the cloud...
Steve: But that doesn't have anything to do with it. People want to know what is going on upfront plain and simple. Ask them what they want to do, make them tell you to stop asking...
7:33PM Walt: Is Silicon Valley different when it comes to privacy?
Steve: No, we take privacy really seriously. Take location on phones -- we take this really seriously. Before any app can get location data, they can't just put up a panel asking if it can use location -- they call OUR panel and it asks you if it's okay. That's one of the reasons we have the curated app store. A lot of the people in the Valley think we're old fashioned about this. But we take it seriously.
7:32PM Walt: Okay, one theme we want to ask about here is privacy. Sorry Mark. There seems to have been a spate of mistakes or false starts... Facebook, Buzz...
Steve: Or Google's WiFi collection.
7:31PM Walt: And you don't have faith that anyone else could do that?
Steve: Sure, but no one else is doing it.
7:30PM Steve: We discovered something -- people are going into apps. They're not just going onto to websites. And people love apps. This is an entirely new thing -- they aren't using search, they're using apps like Yelp.
Steve is now detailing why iAd is better than AdMob or other services.
Steve: Ads now rip you out of your app, you lose your place. Wouldn't it be great if they didn't do that?
7:28PM Walt: But what are you going to do next? You're going into the ad business...
Walt: But what about your competitors in that space?
Steve: Well we think their ad delivery system sucks!
7:27PM Steve: You go back 5 or 10 years, what would you do... we're not going into that... we have the same values that we had back then. The core values are the same. We come into work wanting to do the same thing that we did back then -- build the best products. Nothing makes my day more than getting a random email from someone talking about how cool the iPad is. That's what keeps me going. That's what kept me going back then, and now, and will keep me going in the future.
7:26PM Steve: You know, when this whole thing with Gizmodo happened, I got advice from people who said 'you gotta just let it slide, you shouldn't go after a journalist just because they bought stolen property and tried to extort you.' And I thought deeply about this, and I concluded the worst thing that could happen is if we change our core values and let it slide. I can't do that. I'd rather quit.
7:25PM Super long pause...
7:25PM Kara: What do you imagine the next 10 years of your life will be about?
7:24PM Steve: To get great people is to let them have great ideas. I contribute ideas -- why would I be here if I didn't contribute them?
7:24PM Steve: One of the keys to Apple is that Apple is an incredibly collaborative company. You know how many committees we have at Apple? Zero. We're organized like a startup. We're the biggest start up on the planet. We meet for 3 hours every morning and talk about all the business, about what's going on everywhere. We're great at figuring out how to divide things up into great teams, and we talk to each other. So what I do all day is meet with teams of people.
7:22PM Steve: I have one of the best jobs in the world. I get to come in and work with some of the most brilliant people in the world. We play in the best sandbox...
Walt: But what is your role at Apple day to day? We know there's a new phone coming... what is your personal role there?
7:20PM Kara: What do you do all day? What is your day like?
7:20PM Kara: So in terms of publishing these rules more clearly...
Walt: I talk to developers all the time, but they express to me that they're confused...
Steve: 95% are approved within 7 days...
Walt: So you don't think it could be better?
Steve: I do, but I want to remind you.
7:19PM Steve: We're doing the best we can, we're fixing mistakes. But what happens is -- people lie. And then they run to the press and tell people about this oppression, and they get their 15 minutes of fame. We don't run to the press and say "this guy is a son of a bitch liar!" -- we don't do that.
7:18PM Walt: So what happened with this candidate?
Steve: We had a rule that said you can't defame other people.
Kara: Determined by your app people.
Steve: Yes... and political cartoons got caught in that. We didn't think of that. So this guy submits his app and he gets rejected. We didn't see that coming. So we changed the rule, but this guy never resubmitted... then he wins a Pulitzer Prize, and he says we rejected him. So, we are guilty of making mistakes. We're doing the best we can, we're learning as fast as we can -- but we thought this rule made sense.
7:16PM Steve: Well let first say we have two platforms we support. One is open and uncontrolled -- that's HTML5. We support HTML5. We have the best support for it of anyone in the world. We then support a curated platform which is the app store. It is the most vital app community on any platform. How do we curate this? It's a bunch of people, and they come into work every day. We have a few rules: has to do what it's advertised to do, it has to not crash, it can't use private APIs. And those are the three biggest reasons we reject apps. But we approve 95% of all the apps that are submitted every week.
7:14PM Walt: Can I talk to you about a somewhat different subject, which is curation? You are a retailer of a lot of content, and of apps. And there's been a lot of controversy about your app store rejecting things, sometimes you backtrack. I don't know of any law that any merchant whether it's you or Walmart that says you have to carry something you don't want to carry. But isn't there responsibility with that? You become big, you have the most apps. You've talked in some things you've written about protecting the consumer... but isn't there a downside of you guys acquiring all this power and you saying no to some cartoonist or some political candidate? Don't you have a problem there?
7:12PM Walt: So you made iWork for the iPad. Do you see things that the iPad can't do?
Steve: Well, you can imagine all sorts of things for the iPad. Video editing, content creation...
Walt: Does it require a faster processor?
Steve: Well time has a way of working these things out.
7:09PM Steve: People laugh at me when I say it's magical... but something has been stripped away and removed between you and the computer...
Kara: Well, the keyboard.
Steve: But there's something about it that's magical! I think we're just scratching the surface about the kind of apps you can build for it.
7:09PM Kara: So you mentioned power windows and AC... what do you think will be the additions to the iPad that are like the ones we've seen for cars?
7:08PM Steve: The PC has taken us a long way. They were amazing. But it's changes, vested interests are going to change. And I think we've embarked on that change. Is it the iPad? Who knows? Will it be next year or five years...
Walt: Well you don't think it will be next year?
Steve: Well... who knows?
7:07PM Steve: You know... (long pause). I'm trying to think of a good analogy. When we were an agrarian nation, all cars were trucks. But as people moved more towards urban centers, people started to get into cars. I think PCs are going to be like trucks. Less people will need them. And this is going to make some people uneasy.
7:06PM Walt: Is the tablet going to replace the laptop? Tell me what you think about where it's going?
7:05PM Steve: Yeah... hmmm... well it's complicated. The market right now is way more responsive to consumer demand than it was six months ago. If consumers want it to be less, they'll be more responsive to those signals.
7:04PM Walt: But didn't your system drive prices of books upward? Isn't that opposite of what you just said?
7:04PM Steve: I think people are willing to pay for content. I believe it for music and video, and I believe it for the media.
7:03PM Steve: I can tell you as one of the largest sellers of content on the internet to date -- price it aggressively and go for volume. That has worked for us. I'm trying to get the press to do the same thing. They need to do it differently than they do it for print.
7:02PM Steve: I think we need editors now more than ever.
Steve, we couldn't agree more!
7:02PM Steve: Well I think the foundation of a free society is a free press. And we've seen what's happening to papers in the US right now. I think they're really important. I don't want to see us descend into a nation of bloggers.
Cheers from the audience for that.
7:01PM Kara: What about how it relates to magazines and papers?
7:00PM Kara: So where does the tablet go from here?
7:00PM Steve: I had this idea about having a glass display, a multitouch display you could type on. I asked our people about it. And six months later they came back with this amazing display. And I gave it to one of our really brilliant UI guys. He then got inertial scrolling working and some other things, and I thought, 'my god, we can build a phone with this' and we put the tablet aside, and we went to work on the phone.
6:59PM Walt: So when you built this OS, you did it in a phone. Why? Why not a tablet first.
Steve: I'll tell you. Actually. It started on a tablet first.
6:58PM Steve: And same thing on the tablet. I remember telling you I thought handwriting was the slowest input method ever. We reimagined the tablet, we didn't do what MSFT did. They had a totally different idea than us. And that drove everything. There tablet was based on a PC. It had the battery life, the weight, it needed a cursor like a PC. But the minute you throw a stylus out, you have the precision of a finger, you can't use a PC OS. You have to create it from scratch.
6:57PM Steve: We found a way to sell the phone that we want to sell. We didn't think we could do it, but we did. We'd never been in this business, and AT&T took a big leap on us, and it's worked out really well. And we really changed the rules of the game.
6:56PM Walt: In the near future?
Steve: You know I can't comment on that.
6:55PM Steve: Well they have issues...
Kara: What about going to another carrier?
Walt: Would there be advantages to having two in the US?
Steve: There might be.
6:54PM Steve: Pretty good actually. Remember, they're handling WAY MORE data traffic than all of their other competitors combined.
6:54PM Steve: Well it wasn't like this. Now it's huge. And also, when you bought a phone the carrier dictated what you had on the phone. iPhone was the first phone where we said you worry about the network, we'll worry about the phone/.
Walt: How are they doing on that network?
6:53PM Steve: See, what's so great (he's pretty fired up)... go back a few years ago. There was no app market for smartphones...
Walt: Well Palm had apps. There was no store.
6:52PM Walt: So last year we had a company called Siri, a search company...
Steve: I wouldn't call them a search company...
Walt: Well you bought this search...
Steve: They're not a search company. They're an AI company. We have no plans to go into the search business. We don't care about it -- other people do it well.
6:52PM Steve: Just because we're competing with someone doesn't mean we have to be rude.
6:51PM Man they're really trying to get Jobs to go after Google here.
6:51PM Steve: We want to make better products then them. What I love about the marketplace is that we do our products, we tell people about them, and if they like them, we get to come to work tomorrow. It's not like that in enterprise... the people who make those decisions are sometimes confused.
6:50PM Steve: No.
6:50PM Kara: Are you going to remove them from the iPhone?
6:49PM Kara: Don't ask.
6:49PM Walt: How's your relationship?
6:49PM Steve: My sex life is pretty good.
Wha?! Huge laughs.
6:49PM Walt: So do you feel betrayed?
6:48PM Walt: So you just woke up one morning and heard about Android?
6:48PM Kara: How do you look at Google as a competitor, and how do you feel about them? What happened there?
Steve: Well they decided to compete with us. We didn't go into the search business!
6:48PM Steve: We've created a real competitor to IE. In the mobile space it's #1.
6:47PM Steve: Almost every modern browser is based on webkit... Nokia, Palm, Android, RIM has one... and of course ours.
6:47PM Walt: In phones? Steve: Yeah. Walt: And desktop? Chrome?
Steve: Well Chrome is not... you know. And it's based on webkit, work we did at Apple.
6:46PM Steve: They decided to compete with us... so they are.
6:46PM Steve: We just wanted to make the best thing -- we just thought about how can we build a better product.
Walt: But how about Google? Something has changed. What happened?
6:45PM Steve: And I never have. We never saw ourselves in a platform war with MSFT, and maybe that's why we lost.
Big laughs on that!
6:45PM Walt: Google is building lots of new platforms. Chrome OS, Android. And you've got all these social platforms... Facebook is a huge platform. To Kara and I there's a platform war going on, do you see it like that?
6:44PM Walt: So let's talk about where things are headed. You spent a lot of your career fighting a platform war with Microsoft. They won though. The Mac is making a comeback, but they dominate. There are new platforms now, you've done really well. Smartphones, the beginning of this tablet thing.
6:43PM Steve: We're trying to understand this. We have people over there.
6:43PM Steve: We had this in my hometown of Palo Alto, copy cat suicides. We're over there trying to understand this. It's a difficult situation.
6:42PM Steve: It's a factory -- but my gosh, they have restaurants and movie theaters... but it's a factory. But they've had some suicides and attempted suicides -- and they have 400,000 people there. The rate is under what the US rate is, but it's still troubling.
6:41PM Steve: We are on top of this. We look at everything at these companies. I can tell you a few things that we know. And we are all over this. Foxconn is not a sweatshop.
6:41PM Kara: What about this Foxconn situation?
6:41PM Steve: The person who took the phone plugged it into his roommates computer. And this guy was trying to destroy evidence... and his roommate called the police. So this is a story that's amazing -- it's got theft, it's got buying stolen property, it's got extortion, I'm sure there's some sex in there (huge laughs)... the whole thing is very colorful. The DA is looking into it, and to my knowledge they have someone making sure they only see stuff that relates to this case. I don't know how it will end up.
6:39PM Walt: Where do you come down on this?
Steve: There's an ongoing investigation. I can tell you what I do know, though. To make a product you need to test it. You have to carry them outside. One of our employees was carrying one. There's a debate about whether he left it in a bar, or it was stolen out of his bag. The person who found it tried to sell it, they called Engadget, they called Gizmodo.
6:38PM Walt: We don't know the whole story... I wanted to ask you about the duality to this. Some people don't approve of checkbook journalism. If what we know is true, but on the other hand the police go and don't issue a search warrant, and they grab someone's computer -- there's a lot of stuff, at least with my computer I wouldn't want anyone to have, and they grab this journalists assets...
Steve: Well a guy... who can say if he's a journalist.
6:37PM The audience just freaked out
6:36PM Walt: So you had a prototype of one of your products that wound up at a bar...
6:36PM Steve: He never identified himself as a journalist. I was up late and working and this guy starts sending me obnoxious emails... and I wanted to straighten this guy out. I'm just enough of a sucker... and he publishes it!
6:35PM Kara: You emailed Valleywag...
6:35PM Kara: You've been emailing a lot lately. What has happened in your communication style?
6:35PM Steve: If we succeed, they'll buy them! If we don't, we won't sell any. And I have to say, people seem to be liking the iPad! (huge laughs and applause)
6:34PM Steve: Well things are packages. Some things are good in a product, some things are bad. If the market tells us we're making bad choices, we'll make changes. We're just trying to make great products. We don't think this is great and we're going to leave it out. We're going to take the heat because we want to make the best product in the world for customers!
6:33PM Walt: And what... we'll move on to the next thing you don't want to talk about. What if the market says 'hey it's important enough to us...' there's some great stuff out there in Flash. What if the market says it wants it? What if people say the iPad is crippled?
6:32PM Steve: Our goal is really easy -- we just made a tech decision. We aren't going to make an effort to put this on our platform. We told Adobe to show us something better, and they never did. It wasn't until we shipped the iPad that Adobe started to raise a stink about it. We were trying to have a fight, we just decided to not use one of their products. They made a big deal of it -- that's why I wrote that letter. I said enough is enough, we're tired of these guys trashing us.
6:31PM The audience was cracking up over that.
6:31PM Steve: HyperCard was even more popular...
Walt: It wasn't more popular than Flash!
Steve: In its day...
6:30PM Walt: It's also a dev environment...
6:30PM Steve: Those holes are getting plugged... those holes are mostly ads.
6:30PM Walt: Except when they go to see a site and there's a hole there...
6:29PM Steve: I don't think they see that...
6:29PM Kara: But what about consumers?
6:29PM Steve: Well there "will be" for the last two or three years. But HTML5 is starting to emerge.
6:28PM Steve: There's no smartphone shipping with Flash...
Walt: But you know that there will be...
6:28PM Steve: Sometimes you have to pick the right horses. Flash looks like it had its day but it's waning, and HTML5 looks like it's coming up.
6:28PM Steve: We have a history of doing this. The 3 1/2 floppy. We made that popular. We got ride of the floppy altogether in the first iMac. We got rid of serial and parallel ports. You saw USB first in iMacs. We were one of the first to get rid of optical drives, with the MacBook Air. And when we do this, sometimes people call us crazy.
6:27PM Steve: If you choose wisely, you save yourself an enormous amount of work.
6:26PM Steve: Well two things -- I'll come back to what you said. Apple is a company that doesn't have the resources that everyone else has. We choose what tech horses to ride, we look for tech that has a future and is headed up. Different pieces of tech go in cycles... they have summer and then they go to the grave.
6:25PM Walt: We wanted to talk about your future mostly... but there have been controversies. I want to talk about them. I want to talk about Flash. You published this letter -- even if everything you say in that letter is true, is it really fair or the best thing for consumers to just be abrupt?
6:24PM Steve: That just made us want to work that much harder.
6:24PM Steve: I thought all the good people had left -- but I found these amazing people. I said, why are you still here? (laughs) They said, because I believe in Apple. I love what this place stands for.
6:24PM Walt: It is a little surreal. I remember talking to you when you came back to Apple... the company was in bad shape. Steve: Oh it was on the rocks. We were 90 days from going bankrupt.
6:23PM Kara: You surpassed Microsoft this week. Steve: It's sort of surreal. It's a little surreal.
6:22PM Steve is out!
6:22PM Kara: We have four Steves... let's bring out Steve Jobs.
6:21PM They're thanking everyone and intro'ing D. Walt: "This resort was built directly over the site of an amusement park for kids... this is pretty much the same thing."
6:19PM Walt and Kara are out!
6:19PM "I promise you a fascinating couple of days. I know you're anxious to get started... so I turn it over to Walt and Kara."
6:18PM "This year the WSJ was the only one of the top 25 newspapers to grow, and much of that growth comes from paying online subscribers... many iPad users included."
6:16PM "In a matter of weeks, Apple has sold 2m iPads... and now competitors around the world are announcing ePads and whatnot and are ramping up production everywhere." No, he really said ePads.
6:15PM "We see those on the cutting edge of tech as partners."
6:14PM "At News Corp, we pride ourselves on being a content company. That's what we do."
6:13PM "Thanks to tech and the crumbling barriers to trade, men and women anywhere in the world have access to the best ideas we have to offer."
6:11PM "Eight years ago Steve Jobs told us that the content creators and tech creators didn't understand each other -- I don't think he'll say that tonight."
6:11PM Okay, looks like Rupert is just doing the opening remarks.
6:06PM "Ladies and gentlemen please take your seats -- we are about to begin."
6:03PM Okay we're in our seats and hanging tight. It looks like Rupert Murdoch may be up before Jobs, but we'll let you know. Stay tuned.