The back doesn’t have any personal information.
Todd Haselton | CNBC
Apple’s highest-profile launch this year hasn’t been a new phone or tablet — it’s been a credit card. Investors and analysts have placed a lot of hope in the card as a high-profile new product in Apple’s online services business that management has highlighted as a growth engine for the company.
But the Apple Card could end up being a smashing success even if it doesn’t contribute a meaningful amount to the company’s services revenue or end up being Apple’s beachhead in the financial industry.
Rather, the Apple Card is all about keeping users glued to Apple’s most important product: the iPhone.
The Apple Card can only be signed up for on an iPhone. Sure, there’s a metal card, but the primary interface for the credit card is on your iPhone — and that includes for paying bills.
If you lose your iPhone, you have to pay your bill from another iOS device, or you can call an Apple support phone number, which will connect you to Goldman Sachs to pay your bill, according to Buzzfeed. There’s no web portal on Apple’s website.
All this means is that if you have an Apple Card, it’s going to be hard to switch to Android, at least before you pay off your balance. The credit card makes the phone much stickier.
And people with iPhones are much more likely to buy AirPods, Apple Watches and apps for their devices, all of which essentially require an iPhone to work properly, and all of which feed back into the cycle — when the person with all those Apple products wants a new phone, they’ll buy an iPhone, because it works with all of their Apple products.
Apple’s leadership used to make a big deal about “switchers. ” From time to time, Apple CEO Tim Cook would drop nuggets of information in earnings calls or interviews that suggested that Apple was having a lot of success getting people to move from an Android phone to Apple’s ecosystem.
Switchers are important to Apple because 81% of Americans own smartphones, according to a Pew study, with similar rates of penetration in other rich markets. Many people in the market for a new smartphone either had an iPhone or Android phone before.
Getting Android users to switch is a big enough priority for Apple that some Apple advertisements last year focused on it. Apple has also released software to help people easily transfer data from an Android phone to a new iPhone.
The other side of that coin is that people who have iPhones might want to buy an Android phone when it’s time to upgrade. The latest generation of Android phones are thin, light and powerful, and some are significantly less expensive than the $999 starting price for an iPhone XS.
That’s where the card comes in: as a way to reduce iPhone churn.
Lots of financial details about the relationship between Goldman Sachs and Apple aren’t public, like if Apple is getting a bounty for sign-ups or whether it gets a cut of transactions. But even if those sums aren’t material to Apple, the number of iPhone users who stick in the Apple ecosystem because of their shiny titanium credit card will be.
Goldman Sachs is even approving customers with low credit scores, CNBC previously reported. Even someone with a low FICO score needs to buy a new smartphone eventually.
Apple not a financial company
For what it’s worth, Apple’s leadership pointed to the card last month as a part of its services business, a catch-all line item including App Store fees, search engine fees from Google, AppleCare warranties, and subscriptions to iCloud and Apple Music.
But although the card is a financial product, Apple’s not really transforming into a regulated financial company. Goldman Sachs is providing backend API services to Apple, whose Apple Pay team is in charge of the user interface and product, CNBC previously reported. When you sign up for the card, fine print makes it very clear that the lending and payment aspects are being handled by Goldman Sachs.
This means that Apple can focus on the user experience, which is where its strengths lie. The Apple Card has a lot of nice user interface features. It tracks your spending, charts it, and you can even visualize where you bought things on a map. Apple frames the software as a way to improve your personal finances and as a secure way to pay for things in person and online.
It’s not the most groundbreaking stuff, but if you’re comfortable with Apple software and hardware, it’s nice to have. And in exchange, it will make Apple hardware and software something current iPhone users need to have.
US and China aim to sign trade deal in January, Trump official says
U.S. President Donald Trump and China’s President Xi Jinping at the G20 leaders summit in Japan on June 29, 2019.
Kevin Lamarque | Reuters
The United States and China are aiming to sign a phase one trade deal in January in Washington, according to President Donald Trump’s top trade advisor.
U.S. Trade Representative Robert Lighthizer, one of the lead negotiators in talks with Chinese officials, also told reporters Friday that it would still be wise to be skeptical of whether China would deliver on certain agreements. He also said that there would be no new tariffs as long as China continues to negotiate in good faith.
Lighthizer said the signing would be at the minister level and would not involve Trump and Chinese President Xi Jinping.
The Trump administration has not promised a future rollback of tariffs, Lighthizer said, adding it would be wise to be skeptical on whether China would deliver on certain agreements.
Earlier Friday, Trump and Chinese officials announced that the U.S. and China had agreed to a phase one trade agreement. China agreed to billions of dollars in agricultural purchases from the U.S., while Trump said he would not move ahead with a new round of tariffs on Sunday, among other items.
The USTR said the U.S. will be maintaining 25% tariffs on approximately $250 billion of Chinese imports. The U.S. also agreed to reduce tariffs on $120 billion in products to 7.5% from 15%. That reduction will take effect 30 days after the agreement is signed, Lighthizer said.
Trump had mentioned the tariff levels in a tweet Friday morning in which he also said phase two negotiations would start immediately. Lighthizer also said the negotiations on the next phase in a potential sweeping deal would not wait until after the 2020 U.S. presidential election.
Lighthizer told reporters that China pledged to buy a total of $40 billion in agricultural products, although he said the administration would make its “best efforts” to get to $50 billion, which is the amount Trump himself is calling for.
The phase one agreement was first announced in October. Lighthizer said that the two sides spent the past couple months working out the specifics of the agreement.
The talks, he added, went up until Friday morning – when Trump called to give his approval from the situation room at 10 a.m.
CNBC’s Kayla Tausche reported from Washington, D.C.
USTR weighing 100% tariffs on new EU products including whiskies
U.S. Trade Representative Robert Lighthizer gestures as he speaks during a meeting at the Presidential Palace, in Mexico City, Mexico December 10, 2019.
Henry Romero | Reuters
The U.S. is weighing tariffs of up to 100% on European products the Trump administration previously absolved from such duties, targeting some of the euro zone’s most emblematic products, including Irish and Scotch whiskies and Cognac.
The U.S. Office of the United States Trade Representative on Thursday published a list of additional European goods it is now considering for the tariffs amid the fallout of its high-profile dispute with Airbus.
The USTR earlier this year published multiple lists of European goods worth more $10 billion that it had hoped to target in response to its beef with Airbus. In October, Washington moved ahead and imposed tariffs of 10% on large civil aircraft and 25% on agricultural goods bound from Europe.
Now the USTR is appearing to solicit advice on whether to hike rates on those goods up to 100% as well as add to its earlier list with some goods that the White House had excluded from its final October list. The new items, if added, could also be taxed at a rate up to 100%.
The items newly being considered for tariffs up to 100% range from Spanish olive oil and French cheese to German knives and Portuguese fish fillets. Among the myriad new products under consideration include European spirits like whiskey and Cognac.
The potential list “once again includes blended whiskies and Cognac … The fact that they had been excluded from the ‘final’ October list was a dodged bullet for Spirits companies back then. But now the threat is back,” wrote Bernstein analyst Trevor Stirling in a note to the brokerage’s clients.
“This is a full reshuffle – we are potentially seeing a rolling tariff, which we highlighted as a possibility two months ago,” Stirling added.
The U.S. has long argued that subsidies to Airbus hurt American aircraft giant Boeing and that the EU’s efforts to comply with prior WTO rulings against the subsidies aren’t enough to even the playing field.
But the complaint also represents a chapter in the White House’s broader campaign to reduce trade deficits. Starting with broad tariffs on imported steel and aluminum, the administration has sought to broker new, more advantageous trade pacts through the use of taxes and quotas.
Asked for comment on the new items, the USTR’s office referred CNBC to a prior statement.
“As a result of the EU’s failure to address these subsidies, on October 18, the United States imposed tariffs of 10 percent on large civil aircraft and 25 percent on agricultural and other products” from the EU, the USTR wrote on Dec. 2.
Due to the EU’s failure to curb the subsidies, “the United States is initiating a process to assess increasing the tariff rates and subjecting additional EU products to the tariffs,” it added at the time.
Though Trump has seen some success with his protectionist tactics — notably in a new NAFTA agreement with Canada and Mexico — they’ve also angered economic partners around the globe.
In a separate matter, the U.S. government said last week that it might slap tariffs of up to 100% on $2.4 billion in imports from France after concluding that France’s new digital services tax would harm U.S. tech companies.
The administration’s ongoing negotiations with China are most emblematic of the president’s bargaining style with both Beijing and Washington angling for self-serving deals that don’t appear too lopsided in either direction.
The two sides reached a breakthrough in “phase one” discussions on Friday with the U.S. agreeing to cancel Sunday’s new round of tariffs and rolling back some other duties in exchange for Beijing’s purchases of American agricultural goods.
The deadline for public comments on the USTR’s new tariffs is Jan 13.
West Africa’s first large-scale wind farm starts generating power
A project described as West Africa’s “first ever utility-scale wind farm”, has started transmitting power to Senegal’s national electricity grid.
In an announcement Thursday, renewable power firm Lekela said that Parc Eolien Taiba N’Diaye (PETN) would produce electricity for Senegal across a period of 20 years.
While the 158.7 megawatt (MW) facility has started to export power, construction work is still ongoing and due to finish next year. Once it is fully built, PETN will use 46 wind turbines supplied by Danish firm Vestas.
Africa has huge untapped potential when it comes to renewable energy. According to the International Energy Agency (IEA) it is home to the “richest solar resources in the world” but has installed just 5 gigawatts of solar photovoltaics. This is less than 1% of the planet’s total, the IEA says.
In July 2019, Africa’s largest wind farm, the Lake Turkana Wind Power project, was officially inaugurated. The 310 MW facility was opened by President Uhuru Kenyatta of Kenya.
“We are pleased to note that Kenya is without doubt on course to be a global leader in renewable energy,” Kenyatta said in a speech given at the launch.
“This will not only ensure that our nation’s scenic beauty and unique ecosystems are preserved and protected for both present and future generations, but will also ensure that we become energy independent and that our energy supply will be safe as well as predictable,” he added.
The project is made up of 365 turbines, each having a capacity of 850 kilowatts. It is located 600 kilometers from Nairobi in the Loiyangalani District, Marsabit County.
Construction of the facility started in October 2014 and it began full commercial operations in March 2019.
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