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Recommended Reading: Apple's ambitious TV plan
Can Apple hack it in Hollywood? We talk to the man behind Apple TV+ Stuart McGurk, GQ UK Apple officially revealed it's TV streaming service in March, but it won't debut for the masses until this fall. There have been all kinds of reports swirling about content, including reports that Apple executives were micromanaging creative direction. GQ sat down with senior vice president of Internet Software and Services Eddy Cue to find out more about TV+, and get some clarity on a few of those rumors.
Apple says it isn't micromanaging shows for its streaming service
Apple is rejecting claims that it's fussing over the content in shows for its upcoming TV+ service. In an interview with GQ, senior VP Eddy Cue denied New York Post rumors that he and Tim Cook were leaving notes on scripts and otherwise meddling with the production of TV+ shows. There has "never been one note" passed along,he said, stating that the execs "leave the folks [alone]" who know what they're doing.
Apple Music recruits 11 million trial users in six weeks
Over 11 million people are now using Apple Music following the June 30th launch. "We're thrilled with the numbers so far," Apple senior VP Eddy Cue told USA Today. The service is in a free trial phase until September, so nobody has paid for it yet. The number of users is actually higher, though, as Apple said that 2 million of those folks are on the family plan, which allows six people to use it at once. Still, is 11 million free subscribers a lot? Everyone who updated an iPhone or iPad to iOS 8.4 was nagged to sign up, and it remains to be seen how many will opt out once they have to pay.
Eddy Cue testifies: Apple once contemplated licensing its Fairplay DRM to competitors
With Apple's iPod class action lawsuit underway, Apple executive Eddy Cue took to the stand today and testified about Apple's implementation of DRM on iTunes music files back in the mid-2000s. Recall that the current suit alleges that Apple actively took measures to prevent songs purchased from competing music stores from playing on the iPod. What's more, Apple even went so far as to subtly remove unauthorized songs from users' iPods by instructing them to restore their device to factory settings. For its part, Apple argues that this was done to prevent malicious activity. In any event, Cue -- known as an integral part of Apple's negotiating team -- spoke today about Apple's original implementation of DRM on the iTunes Music Store. While cynics are quick to argue that Apple engaged in anti-competitive behavior, Cue relayed that Apple, in fact, wasn't keen on DRM at the outset. On the contrary, Cue emphasized a fact that has been repeated time and time again: namely that the implementation of DRM was done at the behest of music executives fearful of music piracy gone wild. Interestingly enough, The Verge reports that Apple, per Cue's testimony, at one point contemplated licensing their homegrown DRM technology, dubbed Fairplay, to the market at large. "We thought about licensing the DRM from beginning, it was one of the things we thought was the right move that because we can expand the market and grow faster," Cue told the court. "But we couldn't find a way to do that and have it work reliably." The Verge report adds some color as to why Apple didn't ultimately go down this route: As issue, Cue said, were things like interoperability with the growing multitude of MP3 players. New devices from other companies would come out, and might not work with that system. "Others tried to do this, and it failed miserably," Cue said. "One of those was Microsoft." Cue also noted that when Apple first floated the idea of the iTunes Store to record labels, that they rebuked the idea because they had their own stores with DRM systems that could be different from song to song, and from device to device. DRM-laden music on the iTunes Store was long a controversial topic as it famously, and frustratingly, prevented consumers from playing music they owned on competing devices. While there were workarounds such as burning purchased songs to a CD and uploading them back up to iTunes, the problem still annoyed many users before Apple ultimately did away with DRM restricted music in late 2009.
Eddy Cue: Apple didn't settle e-book antitrust lawsuit because "we feel we have to fight for the truth"
Going head to head with the DOJ over antitrust allegations has been nothing short of a headache for Apple. If you recall, Apple was taken to task for allegedly conspiring with publishers to artificially inflate the price of e-books across the board. Though Apple could have settled the issue out of court, Tim Cook said that Apple wanted its day in court because it had done nothing wrong. For Apple, Tim Cook said a few months back, it was a matter of principle. As it turns out, a principled stance doesn't come cheap, or easy for that matter. Apple ended up losing its case, and in the process, was slapped with a number of punishments, including an external anti-trust monitor they desperately tried to get rid of but must keep on the payroll for two years. Further, if Apple's upcoming appeal falls through, they'll have to fork over $450 million to affected class members. Speaking on the matter to Fortune, Apple executive and key negotiator Eddy Cue reiterated why Apple chose not to settle, instead opting for what turned out to be a thorny legal battle. Echoing previous statements made by Tim Cook, Cue explained that for Apple's it's a simple matter of right and wrong. We feel we have to fight for the truth. Luckily, Tim feels exactly like I do, which is: You have to fight for your principles no matter what. Because it's just not right. As for the irrefutable fact that the price of some e-books increased following Apple's deal with publishers, Cue notes that it wasn't the result of some secretive conspiratorial agreement, but rather something that the publishers were open about wanting. Is it a fact that certain book prices went up? Yes. If you want to convict us on that, then we're guilty. I knew some prices were going to go up, but hell, the whole world knew it, because that's what the publishers were saying: 'We want to get retailers to raise prices, and if we're not able to, we're not going to make the books available digitally.' At the same time, other prices went down too, because now there was competition in the market. Again, Apple ultimately lost the legal battle when Judge Denise Cote ruled that Apple colluded with publishing houses to increase the price of e-books. Apple's appeal is slated to begin on December 15. If Cote's ruling is overturned, Apple will be in the clear. If the ruling is upheld, Apple will be on the hook for the full $450 million.
KTLA goes Apple Pay shopping with Apple's Eddy Cue
Apple senior vice president of internet software and services Eddy Cue has a lot to be happy about with a successful Apple Pay rollout in the last month. He's so happy that he went out and did a lot of early holiday shopping with KTLA's Rich DeMuro at a number of stores that feature -- surprise! -- Apple Pay as a payment method. Cue and DeMuro started their day at Panera Bread, where they ordered a quick breakfast using the chain's app and picked it up, all without interacting with one of those pesky human beings. Then it was off to Bloomingdales, where Cue had the opportunity to pay at a terminal using the now-familiar tap with his finger on the Touch ID home button. At the Disney Store, Cue had to sign for his transaction, explaining that some retailers are still requiring signatures for larger transactions. DeMuro notes that Apple is hoping that eventually retailers will get rid of the need to sign at all. Eventually, the duo showed up at a Santa Monica, CA Apple Store to buy some new iPads ... which of course allow Apple ID purchases from within apps. All in all, this is a great introduction to Apple Pay if you haven't yet had the opportunity to try it out. The video will start in about 30 seconds after the ad.
Eddy Cue on Apple Pay: "We have a lot of work to do, but it should be huge"
With Apple Pay launching today, Apple's Eddy Cue spoke briefly to the Wall Street Journal about some of the challenges faced by Apple's new mobile payments platform. For instance, while the 220,000 merchant locations that will accept Apple Pay at launch certainly sounds impressive, that figure is just a small drop in the bucket relative to the 9 million merchant locations sprinkled throughout the U.S. "We're trying to do something that I think is a game changer and it requires a lot of people to play together," Cue told the Journal. "There's a lot to do here and we have a lot of work to do, but it should be huge." Another potential speed bump for Apple Pay is that the platform currently doesn't support proprietary cards that big name retailers like Macy's like to issue customers. Still, corporate credit cards or prepaid cards aren't accepted yet. Neither are retailers' proprietary credit cards, so shoppers can't use their Macy's or Bloomingdale's cards. That means customers might miss out on discounts tied to the store cards, while merchants relinquish revenue they receive from issuing banks. Notably, a Macy's spokesman told the Journal that support for such cards will be coming soon. On a related note, Businessweek also has a piece up today relaying why some nationwide retailers aren't fully jumping on the Apple Pay bandwagon just yet. While some retailers are keen on loyalty programs not supported by the anonymous nature of Apple Pay, others -- like Starbucks -- aren't exactly racing to upgrade their POS machines with NFC functionality. It'll be interesting to see how Apple Pay at retail locations ultimately resonates with consumers. Interestingly enough, Cue told the WSJ that he expects Apple Pay, at least initially, to be more widely used via mobile apps than at retail storefronts.
Caption This: The Eddy and Walt show
Of all the things I during Apple's iPhone 6 & Apple Watch event, the thing that interested me most was Eddy Cue's lovely pink shirt. Ok, that was a lie, but I still think it's pretty fantastic. This photo -- snapped by Gilipollastv on Flickr -- captures it in all its glory, while also serving as the inspiration for an Eddy Cue / Walt Mossberg buddy comedy that is undoubtedly already in negotiation. Hit us with your best captions in the comments section, and let me know if you recognize the brand Eddy is wearing.
Full video of Eddy Cue and Jimmy Iovine's Code Conference interview now available
Just hours after Apple announced its $3 billion acquisition of Beats Electronics, Eddy Cue and Beats co-founder Jimmy Iovine sat down with Walt Mossberg and Kara Swisher at the inaugural Code Conference to discuss a wide range of topics, though the conversation naturally focused on music. The full interview lasts about an hour and is well worth checking out, if only because it's not too often we get to see Apple employees talk so freely and candidly. What's more, the Code Conference was the first time we've seen Eddy Cue really step up in the public spotlight in an arena outside of an official Apple media event. Check it out below. Your browser does not support iframes.
Eddy Cue discusses challenges facing Apple in the TV space
While the topic du jour during Eddy Cue's Code Conference interview naturally centered on Apple's Beats acquisition, there were also some notable exchanges regarding Apple's burgeoning interest in the TV space. As it stands today, Apple's involvement with TV begins and ends with the Apple TV. Long considered nothing more than an intriguing hobby product, the Apple TV has slowly but steadily grown in popularity and has become a notable success in its own right. Cue relayed that Apple thus far has sold over 20 million Apple TV units and that the product is now a billion dollar per year business. Cue further added that Apple TV is "doing great" and that Apple plans on adding even more content this year. Still, Cue believes there's much room for for improvement. The reason there's so much interest in TV in general is that the TV experience sucks. All we have today is glorified DVRs. You still have to manage storage on your DVR. If I forget to do that I can't watch it. It's not the way your experience is with Apple TV. ... The experience has been stuck. I wanted to watch TV on my iPad today. It's hard to do that. I think it can be a lot easier. I think there's a long way to go with TV. That being the case, Cue was pointedly asked why Apple hasn't released a "TV that doesn't suck." It's a good question that uninformed analysts often love asking, but as Cue went on to explain, maneuvering in the TV space is extremely complicated and fraught with a myriad of hurdles and logistical challenges. "TV is hard," Cue stated. "There are no standards, either globally or locally. There are lots of right issues and it's a complicated landscape to solve." Cue added that while some of the problems in and of themselves aren't terribly complex, finding solutions is tough because of all the varying corporate interests involved. I'm not going into details but the problems aren't complicated. Solving them is complicated because there are lots of parties involved. Music is much easier because rights are pretty much set at this point. TV isn't there. Also chiming on on the TV discussion was Beats co-founder and newly minted Apple employee, Jimmy Iovine. Iovine intimated that curation in the video space is just as important as it is in the realm of music. "My biggest problem is with movies," Iovine said bluntly. "I was with my girlfriend the other day and her kids, and we were trying to watch a movie. It took us 20 minutes to try and find a movie to watch. We need curation." Might this be a nod to Apple's future plans? It remains to be seen, but recall that Apple last summer purchased a video discovery startup called Matcha.tv because they were reportedly impressed with the company's recommendation algorithm.
The TUAW Daily Update Podcast for May 29, 2014
It's the TUAW Daily Update, your source for Apple news in a convenient audio format. You'll get some the top Apple stories of the day in three to five minutes for a quick review of what's happening in the Apple world. You can listen to today's Apple stories by clicking the player at the top of the page. The Daily Update has been moved to a new podcast host in the past few days. Current listeners should delete the old podcast subscription and subscribe to the new feed in the iTunes Store here.
Eddy Cue says Apple's 2014 product pipeline is the best he's seen in 25 years
When Apple executives discuss future products, they typically speak in generalities. You know the routine; "our product pipeline is strong and consumers will be excited by what's coming." Rinse and repeat. But comments made by Apple executive Eddy Cue during yesterday's Code Conference were a little bit different. Cue didn't divulge specifics, of course, but his remarks affirm that innovation is a top priority at Apple and that 2014 could be a watershed year for the company. Appearing on stage with Beats co-founder Jimmy Iovine, Cue told Kara Swisher and Walt Mossberg that Apple's product pipeline in 2014 is the most impressive he's seen. "Later this year, we've got the best product pipeline that I've seen in my 25 years at Apple," Cue said. Executives typically hype their company's future, but this seems like a supreme display of confidence from Cue. Earlier this year, Tim Cook told the Wall Street Journal that Apple plans to enter a new product category in 2014. There will be new categories. We're not ready to talk about it, but we're working on some really great stuff," Mr. Cook said. When asked whether a new product category could mean an improvement on an existing product like an iPad Air, a lighter version of its tablet computer, or new services such as mobile payments, Mr. Cook declined to comment. He said that anyone "reasonable" would consider what Apple is working on as new categories. As for what Apple has up its sleeve, that's anybody's guess. Recently, the Financial Times -- the same site that broke the Apple/Beats acquisition a few weeks ago -- reported that Apple will unveil an iOS-connected "smart home" platform that would enable users to control "lights, security systems and other household appliances" directly from their iPhone. All that being said, it's always important to remember that no Apple product or service, no matter how loud the rumor mill, is ever a done deal until an Apple executive trots out on stage and introduces it.
Eddy Cue calls accuracy of "Haunted Empire" into question
One of the few pieces of interesting information found in Yukari Kane's new book about Apple -- Haunted Empire -- details how Eddy Cue became one of Steve Jobs' trusted lieutenants. The passage in question reads: In one version of a story that he told everyone, he was plucked out of the IT department by Jobs during a meeting in which he had dared to voice an opinion about the topic at hand. When Jobs looked at him and told him to shut up, an undeterred Cue spoke up again, causing Jobs to throw a pen at his forehead. Cue, who by then figured he had nothing to lose, braced himself and offered up his opinion for a third time. This time, he won Jobs's approval. From that moment on, Cue became Jobs's guy... As it turns out, the veracity of the excerpt in question has been challenged by none other than Eddy Cue himself. Earlier today, 9to5Mac's Benjamin Mayo emailed Cue asking if the aforementioned excerpt was true. Cue, in classic Apple executive fashion, answered succinctly: "No it's not." All in all, this isn't terribly surprising given the plethora of other shortcomings the book presents. You might recall that Apple CEO Tim Cook yesterday called the book "nonsense", to which Kane responded with a blurb of her own. For Tim Cook to have such strong feelings about the book, it must have touched a nerve," Kane said. "Even I was surprised by my conclusions, so I understand the sentiment. I'm happy to speak with him or anyone at Apple in public or private. My hope in writing this book was to be thought-provoking and to start a conversation which I'm glad it has. Touched a nerve? Perhaps, or maybe a more likely explanation is that the book truly is nonsense. My own review aside, the book has seemingly garnered nothing but negative feedback from those who have slogged through and read it.
How Eddy Cue won over Steve Jobs, when Jobs said no to an Apple HDTV, and much more
The premise of Yukari Iwatani Kane's upcoming book, Haunted Empire: Apple After Steve Jobs, is that Apple under the reign of Tim Cook is still struggling to secure its footing following the passing of Steve Jobs. Kane argues that without Jobs steering the ship, Apple has lost some of its innovative spirit and is devolving from a great company into a good one. I'll have a full review of the book up soon, but below are a few anecdotes worth sharing. Eddy Cue wins over Steve Jobs While now a household name for those who follow Apple, Eddy Cue wasn't a widely known figure outside of Cupertino until August 2008 when Steve Jobs tasked him with fixing the fumbled launch of MobileMe. MobileMe, of course, would eventually make way for iCloud. Now an integral part of Apple's executive team, Cue initially put his stamp on Apple by helping oversee the development and rollout of iLife, the iTunes Store and Apple's online store. In the process, Cue also served as a dealmaker by helping negotiate Apple's first iPhone deal with AT&T and even played the role of peacemaker when Apple invariably butted heads with record labels. A 2012 Cnet profile of Cue notes that he "helped prevent the relationship between Apple and the large record companies from collapsing" in 2007. These days, Cue has more than enough responsibilities to keep him busy. As Apple's Senior Vice President of Internet Software and Services, Cue oversees the iTunes Store, the App Store, iCloud, iAds, iTunes Radio, the iBookstore, Siri, and Maps. Quite a full plate, to say the least. A longtime Apple veteran, Cue's tenure with Apple stretches all the way back to 1989. Kane writes that Cue started as an intern at Apple whereupon he rose through the ranks. In one version of a story that he told everyone, he was plucked out of the IT department by Jobs during a meeting in which he had dared to voice an opinion about the topic at hand. When Jobs looked at him and told him to shut up, an undeterred Cue spoke up again, causing Jobs to throw a pen at his forehead. Cue, who by then figured he had nothing to lose, braced himself and offered up his opinion for a third time. This time, he won Jobs's approval. From that moment on, Cue became Jobs's guy... Kane writes that Cue and Jobs were particularly close and that Cue frequently visited Jobs when the Apple co-founder fell ill. In November, Jobs was inducted into the Bay Area Business Hall of Fame. Cue accepted the award on Jobs' behalf and spoke in glowing terms about his longtime boss. He was a colleague, but most important, he was my friend. We talked every day, we talked about everything. Even in my darkest days, he was there for me. When my wife had cancer, he was there for us. He helped me with the doctors and the treatments, he told me a lot about what he was going through, and her. And in many ways, she's here tonight because of him, so thank you, Steve. When Steve Jobs said Apple isn't making a TV Nearly every year, Apple holds a "Top 100" retreat where the company's best and brightest pile into buses and head down to a resort at Carmel Valley Ranch. According to Adam Lashinsky, who initially reported on the retreat in a 2011 Fortune article, the gathering is typically comprised of the top 100 employees Apple would theoretically want to keep if forced to start anew. Undoubtedly an honor to be chosen, attendees at these retreats are given sneak previews of Apple's upcoming product plans, sometimes many months in advance. It's been reported that attendees at previous retreats were given advance notice of the iPod, Apple's foray into the retail business, and the iPhone. Filled with meetings and presentations, the retreat provides employees in attendance an opportunity to discuss and ask questions about anything at all, without the typical veil of secrecy that typically shrouds the company. Apple's 2010 retreat was held that November, with Kane relaying that an employee there took advantage of a Q&A session with Jobs and asked if Apple is going to make a TV. Jobs didn't hesitate. "No," he replied. "TV is a terrible business. They don't turn over, and the margins suck. He added, however, that he wanted to own the living room. Of course, rumors of Apple releasing an HDTV have persisted for quite some time. Often times, analysts have been quick to suggest Apple needs to release an HDTV simply for the sake of entering a new product category, wholly ignoring that the TV business was and continues to be exceedingly unprofitable -- just ask Panasonic and Sony. So while Apple's future plans are anybody's guess (my invite to the retreat must have gotten lost in the mail), Jobs' statement about owning the living room is worth latching onto. It suggests that Apple, as is typically the case, is thinking bigger than just TV. It wants an Apple shaped living room experience that may be more simply achieved via the Apple TV than with an Apple HDTV. Jobs: Always a stickler for details With respect to the employee presentations that comprise a portion of the "Top 100" retreat experience, Kane writes that Jobs, per usual, was a stickler for the most minute details imaginable. Employee presentations, put together with Keynote of course, had to abide by precise guidelines. One font family per presentation, three or five bullet points per slide, never four, and titles 30 percent above the center line. The file size also could not be more than eight megabytes, just enough to show up well on a projection screen. Jobs hated big files. Tim Cook aims high and demands perfection Lastly, Kane provides some more color to the man that is Tim Cook. Known as a tireless and relentless worker, the Wall Street Journal recently provided a book excerpt highlighting Cook's high expectations and no-nonsense approach. From the start of his Apple tenure, Cook set colossally high expectations. He wanted the best price, the best delivery, the best yield, the best everything. "I want you to act like we are a $20 billion company," he told the procurement team-even though Apple then had only about $6 billion in annual revenues and was barely eking out a profit. They were playing in a new league now. Now one of Cook's first tasks upon joining Apple was to take care of the company's lingering inventory problem. On this note, Kane tells a story of Cook's first trip to Asia where he met with Apple's operations team in Singapore. At the time, the industry standard for annual inventory turns -- "a measure of how often a company sold and replaced its inventory" -- was 25. The goal, of course, was to maximize the number of inventory turns in the interest of efficiency. At the meeting in question, Cook's operations team explained how they might achieve 100 turns. Impressive, but Cook was thinking bigger. "What about 1000 turns?" Cook asked. The premise of the question was so outlandish that it elicited laughter from his team. Only problem was that Cook was dead serious. "I'd like you to look at it," Cook told them. Eighteen months after he started, Apple was turning inventory daily... Within a few years the Asia team even accomplished near infinite turns, the epitome of inventory management. It meant they had no inventory. Its operations were so lean that customers were practically buying the product as it was coming off the assembly line. While inventory levels would increase once Apple's product line began expanding in the mid-2000s, there was no mistaking Cook's talent as an operations whiz with exceedingly high standards for both himself and those around him. It's not exciting to me to improve by five percent," Cook had said. "Now double or triple it, that's exciting.
Eddy Cue gives acceptance speech as Steve Jobs is inducted into Bay Area Business Hall of Fame
Last Thursday, November 7, Steve Jobs was posthumously inducted into the Bay Area Business Hall of Fame. Accepting the award for Jobs was Apple's SVP Eddy Cue, who has now tweeted a link to a video of the event. As TechCrunch notes, Cue's speech was at times very emotional and talked of the deep friendship he and Jobs had: "He was a colleague, but most important, he was my friend. We talked every day, we talked about everything," Cue says. "Even in my darkest days, he was there for me. When my wife had cancer, he was there for us. He helped me with the doctors and the treatments, he told me a lot about what he was going through, and her. And in many ways, she's here tonight because of him, so thank you, Steve." Cue also told this story of Jobs' precision in deciding how the light should hit the original iMac on stage when it was first introduced -- a level of detail that we are all so familiar with from Jobs now: He taught me many things but none more important than '"do what you love." That's what he did every day. It wasn't about fame; it wasn't about fortune; it was about creating great products. And not accepting anything less than perfection. As I was coming in today, I was trying to remember a story of the first time I learned that from Steve. We were launching the iMac, in Bondi blue ... we were doing this at the Flint center in Cupertino. Unfortunately we couldn't get the venue, Stomp was there the night before, we were launching it the next day and we could only get in at midnight. So we come in at midnight, we were going to do rehearsals ... one of the things we wanted to do was have the iMac come out from the stage as he was introducing it. And we'd shine some lights. I was sitting out in the crowd ... and the iMac comes out and the light comes on it and I said "wow, that is so cool!" Steve stops the whole thing and says "stop, this sucks!" He says, "it should come out at the side where you can see the color, the light should be shining at this side and when it turns to the front that's when it should turn on ... 30 minutes later we do the whole thing again and when I see it come out I said, "Wow, he was absolutely right; it's incredible." He had that level of detail for everything he did, and that's what he taught us. You can check out the video montage of the event below.
Eddy Cue intros new Apple internal iTunes channel to tout work by employees
In-the-know blogger Mark Gurman is reporting that Eddy Cue, Apple Senior VP of Internet Services, recently sent out an email to Apple employees informing them of a new employee-only section on iTunes. Cue's letter, obtained by Gurman, describes the new iTunes section thusly: Team, One of the things that makes Apple special is that every person here, no matter where they are or what they do, shares the same deep passion for creativity and innovation. We see this passion most noticeably in the products we make and in the experiences we create for our customers. But it's in other places, too. For instance, in addition to their work here at Apple, many employees have helped create some amazing books, songs, movies and TV shows on iTunes. In celebration of their achievements, as well as the creative pursuits of everybody at Apple, we're launching a new internal website today. It's my pleasure to introduce you to our very own Employees on iTunes. Eddy It's certainly nice that Apple is taking steps to highlight the varied creative endeavors of Apple employees. Indeed, iTunes new Apple-only section reminded me of a Steve Jobs quote from Triumph of the Nerds where he describes the team who helped develop the original Mac. Ultimately, it comes down to taste. It comes down to trying to expose yourself to the best things that humans have done and then try to bring those things in to what you're doing. Picasso had a saying: good artists copy, great artists steal. And we have always been shameless about stealing great ideas, and I think part of what made the Macintosh great was that the people working on it were musicians and poets and artists and zoologists and historians who also happened to be the best computer scientists in the world.
Eddy Cue also attending Sun Valley Conference
Yesterday we reported that Tim Cook is attending the Sun Valley Conference that takes place in Idaho this week. This year's conference has a heavy focus on content deals and cable television. Given that both those things are extremely important for a future Apple television, it is perhaps telling how significant this Sun Valley Conference is, because not only has Tim Cook shown up, but now Eddy Cue has been spotted as well. Apple's Tim Cook & Eddy Cue arrive at Sun Valley. Big week ahead? "We'll see" says Cook #sunvalley13 pic.twitter.com/QGIRExpMGQ - Jon Erlichman (@JonErlichman) July 10, 2013 Bloomberg reporter Jon Erlichman spotted Cue, who is Apple's senior vice president of Internet Software and Services, along with Cook yesterday. If any content deals are in the works, Cue would be the one leading them on Apple's side. The Sun Valley Conference runs until Friday, but if there are any content deals struck, it would be unlikely that they would be announced publicly just yet.
Eddy Cue: Steve Jobs picked 'Winnie the Pooh' as the iBooks freebie, also came up with the idea for 'page curls'
While testifying in court last week, Apple executive Eddy Cue had a number of interesting tidbits regarding the origins of the iBookstore, namely that Steve Jobs was initially opposed to the idea, but quickly hopped on board after Cue convinced him that the iPad would make the perfect e-reader. Today, Cue took the stand once again where he divulged some more interesting tidbits regarding Apple's foray into the e-book space. At one point during today's proceeding, an Apple attorney asked Cue a number of questions about Jobs and his involvement in Apple's iBooks initiative. Once again, All Things D was there covering the trial and relayed the following nuggets of information. The "page curls" in the iBook app, which show up when you flip an iBook's page? That's Steve Jobs' idea. It was Jobs' idea to pick ""Winnie-the-Pooh" as the freebie book that came with every iBook app. Not just because Jobs liked the book, Cue said, but because it showed off iBook's capabilities: "It had beautiful color drawings, that had never been seen before in a digital book." Jobs was also specific about the book he used to show off the iBook during his initial iPad demo in January 2010. He picked Ted Kennedy's "True Compass" memoir, because the Kennedy family "meant a lot to him," Cue said. Indeed, Cue's testimony serves to underscore that you'd be hard-pressed to find another CEO in the annals of tech that was as product- and detail-oriented as Jobs. Apple's trial with the DOJ is slated to end this week.
Steve Jobs didn't want an iBookstore until Eddy Cue convinced him
During Apple's e-book price-fixing case on Thursday, Apple executive Eddy Cue testified that Steve Jobs initially wasn't interested in getting into the e-book market at all. Lucky for us, All Things D was on hand to capture all of the courtroom details describing the backstory behind Apple's eventual foray into the e-book market. Cue explained that when he first approached Jobs and broached the topic of getting Apple into the e-book business, Jobs wasn't on board. "He wasn't interested," Cue explained. "Steve never felt that the Mac or the iPhone were ideal reading devices. In the case of the phone, the screen was smaller, and in the case of the Mac, you had this keyboard and device, and it didn't feel like a book." The iPad, however, was a game changer. When Cue first began using the iPad in the months before Apple publicly unveiled the device, he immediately recognized the potential for it to become a wildly successful and popular e-reader. So with the iPad unveiling steadily approaching, Cue in the fall of 2009 said that he approached Jobs yet again with the idea of getting into the e-book market. And so I went to Steve and told him why I thought [the iPad] was going to be a great device for e-books ... and after some discussions he came back and said, you know, I think you're right. I think this is great, and then he started coming up with ideas himself about what he wanted to do with it and how it would be even better as a reader and store. Cue noted that Jobs finally came around to the idea of an iBookstore in November 2009. Now bear in mind that Apple first introduced the iPad in January 2010, meaning that Cue, Apple's chief content negotiator, was left with little to no time to secure deals with major publishing companies as Jobs wanted to demo Apple's new e-book initiative on stage for the world to see. Of particular interest was Cue's testimony detailing how he was especially motivated to secure content deals ahead of the iPad's introduction on account of Jobs' worsening health. Steve was near the end of his life when we were launching the iPad, and he was really proud of it. He was working hard on it. I believed that iBooks was going to be a tremendous feature of the product. People were going to love it; our customers were just going to go wild about iPad and iBooks, and I wanted to be able to get that done in time because it was really important to him ... I like getting my work done and I pride myself on being successful, but this had extra meaning to me. Now aside from the usual intrigue typically associated with discovering what goes on behind the scenes at 1 Infinite Loop, I find this whole story noteworthy for two reasons. First, this isn't the first time we've heard a story about Cue successfully convincing Jobs to move Apple in a particular direction. During last summer's Apple / Samsung trial, emails came to light which revealed that Cue had been pushing Jobs to release an iPad with a smaller form factor as early as 2010. In a January 2011 email sent out to members of Apple's executive team, Cue wrote: I believe there will be a 7-inch market and we should do one. I expressed this to Steve several times since Thanksgiving and he seemed very receptive the last time. I found email, books, Facebook and video very compelling on a 7''. Web browsing is definitely the weakest point, but still usable. Apple would of course go onto announce the iPad mini in October 2012. Second, the story provides further proof that Apple is teeming with talented employees and that the company is poised to succeed even in the absence of Jobs. While Jobs was a visionary without compare, the stories above illustrate that Jobs sometimes needed a bit of convincing before deciding where the "puck was going." In short, the notion that an Apple without Jobs is destined for failure is ridiculous. Indeed, one of the reasons Jobs was able to successfully bring Apple back from the brink of bankruptcy was precisely because he surrounded himself with top-tier talent. To that end, this old quote from Jobs regarding his hiring philosophy is worth a mention: ... you're well advised to go after the cream of the cream. That's what we've done. You can then build a team that pursues the A+ players. A small team of A+ players can run circles around a giant team of B and C players. That's what I've tried to do.
US Justice Department makes opening arguments in e-book price fixing case
Apple's e-book price fixing trial began yesterday in New York and the US Justice Department wasted no time painting a picture purporting to show that Apple, along with five publishing houses, colluded to artificially raise the price of e-books. In a series of 81 slides released on Monday, the Justice Department laid out its case as it attempts to prove that Apple and five publishing companies violated the Sherman Antitrust Act. The five publishers at issue include the Penguin Group, HarperCollins, Simon & Schuster, the Hachette Book Group and MacMillan. Notably, all five publishers have since settled, thereby leaving Apple the only company actually taking the case to trial. Front and center in the DOJ's case are emails sent from Apple executive Eddy Cue to publishers in an attempt to get them to sign up for the agency model as it pertains to e-book pricing. The DOJ also alleges that Cue routinely told some publishers what other publishers had already agreed to, thereby greasing the wheels for collusion. The entire slidedeck can be viewed below. U.S. v. Apple Et Al Opening Slides Apple, for its part, claims that its dealings simply served to increase competition in the marketplace and break Amazon's monopolistic grip on the e-book industry. Last April, Apple had this to say regarding the DOJ's allegations: The DOJ's accusation of collusion against Apple is simply not true. The launch of the iBookstore in 2010 fostered innovation and competition, breaking Amazon's monopolistic grip on the publishing industry. Since then customers have benefited from e-books that are more interactive and engaging. Just as we've allowed developers to set prices on the App Store, publishers set prices on the iBookstore. The result of Apple attempting to foster "innovation and competition," however, is that the price of e-books rose significantly in April of 2010. The chart below is rather telling. Covering the trial, Philip Elmer-DeWitt reports that Apple, as one would expect, countered that the DOJ's case lacked merit. Specifically, Apple's lawyers said that the company merely used the same approach it used when first getting music publishers on board the iTunes bandwagon. The end result, Apple noted, was an influx of billions of dollars into the US economy. "Apple should be applauded, not condemned," an Apple attorney stated. Well, this will certainly be an interesting trial. While Apple does settle legal disputes from time to time, this doesn't seem like one of those cases. During his recent All Things D interview, Apple CEO Tim Cook emphasized that Apple has done nothing wrong, and out of principle, will refuse to admit to doing something it did not do. In any event, Eddy Cue is slated to testify during the trial on June 13. I guess he'll be missing Bill Nye The Science Guy.
