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00:00Mark, the road to a foldable phone for Apple. Tell us more about this project codenamed V68 inside the company.
00:09Yeah, this is a long time coming. This is something that started as an exploratory project into foldable screens over
00:17a decade ago.
00:19Evolved into the idea of building an iPad mini that can unfold into a larger screen iPad.
00:24And then after Tim Cook got involved in the project, then shifted to Apple actually building a foldable iPhone at
00:31the high end of the lineup.
00:33Tim Cook came back from Asia, a big trip in 2020, China, Korea, you name it.
00:39Saw the Huawei and the Samsung folds everywhere, became obsessed with the category, thought Apple should play into it, and
00:46really pushed the hardware engineering team to develop something.
00:49Then back in 2023, they had their aha moment, which was this passport-sized phone.
00:55Shorter and wider, better for video, 4x3 aspect ratio, also good for e-book reading.
01:00And this is the direction they took.
01:02This design, this aha moment intersected with the core technologies coming to a place where Apple thought it actually could
01:09bring a product to market.
01:11And then they set their sights on 2026, and here we are.
01:15This will be debuted tomorrow, not by Tim Cook, but by his successor, John Ternus.
01:20And the transition date of September 1, that was intentionally chosen, so Ternus could be the one to introduce this
01:27device and sort of put his face and his stamp on it.
01:31Typically, when Apple does a transition, it's not right smack in the middle of the fiscal quarter like this one.
01:36They do it at the tail end of the year, the very beginning of the year, April, October.
01:40So this has all been timed together very intentionally.
01:43How big a deal is it for the old CEO, Tim Cook, and for the new CEO, John Ternus, and
01:49also really for the company overall, Mark?
01:52Well, it's not a big deal for the old guy because he doesn't have as much at stake as Ternus.
01:59If you look at their compensation packages, only half of Apple's performance versus its peer group comes into play when
02:06it comes to Tim's shares moving forward.
02:09For Ternus, 75% of Apple's performance impacts how much he's going to get paid on a stock basis.
02:17And so it means a lot more for Ternus.
02:19Hey, Mark, that would be Tim Cook, not me, Tim.
02:22I don't have any of the Apple shares, unfortunately.
02:25So, Mark, when you think about the tech that goes into manufacturing this, can you explain, you know, this is
02:33Tim Cook's specialty, supply chain, manufacturing, logistics.
02:36Can you explain what goes into making a phone that folds sort of seamlessly and where it's done?
02:44You know, when they launched the first foldable phones, that being Samsung in 2019, there were a lot of problems.
02:49I'll actually never forget.
02:51So I was one of the handful of people to get a review unit of the new Samsung phone fold
02:56in 2019.
02:57So I flew to New York.
02:58I met with them.
02:59It was all secretive, et cetera.
03:00So I get this review unit.
03:01And then you take it out of the box, and it has a film on top of it.
03:06And I thought it's just the film that comes on any product you buy.
03:10There's a film on it.
03:11You rip it off the screen.
03:12You get using it.
03:13But no, no, no.
03:14This film that I removed from this review unit was actually tied to the phone.
03:20So I removed the film.
03:21And then the next day, the phone is completely broken.
03:24It doesn't work anymore.
03:25You shouldn't have removed the film.
03:27It's crazy.
03:28And there's like no warning label or anything on it.
03:31And they never discussed this.
03:33And so I tweeted pictures of it.
03:35When viral, Samsung ends up needing to postpone their foldable phone launch for months and redesign the hardware to make
03:44it so the film can't be removed.
03:47Long story short, my tweet cost Samsung probably tens of millions, if not more, hundreds of millions of dollars and
03:54postponed this launch.
03:56But that's all to say that these are very complicated new display technologies.
04:02And there's a reason why Apple has waited in the background and worked on this in the background for many
04:07years versus just deploying what five years ago amounted to a beta prototype-like technology.
04:13Now is the time where this core tech gets you to a place where you don't need a big crease,
04:17where the phone could be more durable, where it could withstand water and sand and dust to some extent.
04:24And the complexities here necessitated a new type of glass cover that Apple and Corning, their longtime glass partner, have
04:35co-developed for this display.
04:36And so it's going to be pretty high tech.
04:38And, of course, as the Siron says, it's going to be pretty expensive, too.
04:44Well, you know, to follow on that, Mark, Apple, as we've often said with you, not always the first to
04:48market maybe with something or certainly with a smartphone.
04:50And yet when they do enter it, they make their mark and lead the way.
04:54Might that be the case here, too?
04:57Well, they couldn't really enter it till now because people are going to buy foldable phones from Apple three years
05:01ago and they're going to destroy them and it's going to hurt Apple's reputation.
05:04And so the stakes for Apple are much different.
05:08I think I've told this story on your show before.
05:11But, you know, when you were thinking about the Apple car, what was one of the big reasons why Apple
05:14could ever bring a car to market?
05:15It was because they were worried that every time an Apple car would get into a car accident or there
05:19would be an issue, it would be disastrous to Apple's brand.
05:22And Apple's brand is such that they're not going to risk those things.
05:26And so they weren't going to bring this foldable phone out.
05:28Obviously, it's much less dangerous than a car, depending on who you ask, I guess, until this was ready.
05:36Have you seen it?
05:38Have you played with it?
05:41I've been playing with the Samsung foldable phone, the Samsung Z Fold 8, which is going to be quite similar.
05:48So if anyone has a Z Fold 8, you can imagine that as what the new Apple phone is going
05:53to look like.
05:53But obviously, Apple will have their fit and finish and what have you.
05:56One thing that we've all found familiar about these Apple events is they highlight partners, too, that use these devices.
06:07So is there going to be, in your view, some sort of maybe software partner, a developer that will showcase
06:12the way you can use this phone differently tomorrow when Ternus takes the stage?
06:19I think it's possible.
06:22The new SDK, the iOS 27s, they have some new tools in there for testing various new screen sizes, which
06:30was an obvious hint that this is foldable phone coming.
06:32And so I think developers are ready, and developers are prepared, and developers are excited.
06:35And it gives them a leg up over the Android ecosystem, which until recently has not really done a good
06:39job for foldable phones.
06:42$2,000 or almost $2,000.
06:45To start with.
06:46To start with.
06:47I'm just curious, how big a market is this, or how big a market size could this potentially be when
06:52you come to kind of all cell phone smartphones, if you will?
06:56I mean, the market right now is about 2% of sales in the U.S. in terms of all
07:00foldable phones across all smartphones.
07:02It's double that in China, where this category is growing way faster than the overall smartphone market.
07:09I think Apple is going to be able to produce 7 to 10 million units this year, and they're going
07:13to sell every one they can get, and it's going to become a status symbol, and everyone's going to want
07:16one.
07:17Will everyone be able to afford one?
07:18Will everyone be able to find one?
07:20That's another question.
07:21But, you know, the levers are there with the new Apple subscription program and the carriers and trade-ins to
07:25make this happen for a lot of people.
07:27So I think it's going to be quite exciting.
07:28Certainly the most exciting iPhone launch in a decade.
07:30Okay, looking forward to that.
07:31Mark, the carrier trade-in programs and also the, not the financing, but the way that Apple is doing this,
07:38or is it financing?
07:39Will you talk a little bit about that and sort of lessening the sticker shock for some people?
07:45Well, it's a leasing program.
07:46So what it means is that you're not taking the price of the phone and chopping it up over 24,
07:5236, or 48 months.
07:54What you're doing is basically just getting a monthly fee that Apple determined.
07:57And then at the end of your lease term, whether that's 12 months or 24 months or 36 months, you'll
08:04have the option to pay off the rest of the phone and keep it or start a new lease at
08:08that price or a price close to it for, you know, a successive generation.
08:12And the idea with the Apple upgrade program is you get on this plan and then you get the new
08:16phone every year and you're constantly paying that same fee and you're constantly sending your old phone back.
08:21What are you going to be looking for as you check out the new phone?
08:25I mean, what is it going to make, you know, are there going to be any limitations based, you know,
08:29versus kind of the existing smartphones from Apple?
08:32Or I'm just curious.
08:35Well, in addition to being double the price, the cameras are not going to be as good.
08:40The battery life is going to be shorter.
08:43The camera thing I really want to highlight because it's not going to have the telephoto lens, which is great
08:47for deeper zoom.
08:48They're going to try to make up for it in software like they do with the iPhone Air, but the
08:52camera system is just not going to be as top tier as what you're going to see in terms of
08:56the camera announcements tomorrow for the iPhone 18 Pro and especially the iPhone 18 Pro Max with the better depth
09:01control and more finite adjustments.
09:03And the 18 Pro and Pro Max, they're going to have really high level pro DSLR like camera features.
09:09And so this is going to be a big change coming from that type of phone to this foldable phone.
09:14But if you're not a camera buff, you know, I think it'll be fine.
09:16What if I don't want a foldable phone yet?
09:19What are they going to showcase tomorrow?
09:20Don't buy one.
09:21What are they going to showcase tomorrow?
09:23So I have the 18 Pro and 18 Pro Max.
09:26The big difference is goodbye orange, hello red, or burgundy, or wine, whatever they're going to call it.
09:31It's a red light color.
09:33And it's going to have a much faster processor, 2nm chip, the A20 Pro, the same chip that's going to
09:37be in the foldable phone.
09:39And then the big highlight is going to be the camera system, a pro level camera system, really competing with
09:44DSLRs more than they have in the past.
09:46And so it's going to be pretty advanced.
09:48They're going to spend a lot of time with the photography capabilities of the 18 Pro and Pro Max.
09:51I think that's what I'm going to get.
09:52I don't know if you were listening or were on yet when I was talking about that.
09:55I still have the 13.
09:56iPhone 7.
09:57No, I have the 13.
09:59Carol still has a second generation watch.
10:01Hey.
10:01All right.
10:02Well, hey, when you come out here, bring the foldable phone when you get it, Mark.
10:07And we'll check it out on set.
10:09And I'm sure I'm going to love it.
10:10So we'll have fun.
10:11Hey, is there anything else?
10:13New earbuds or anything?
10:14Real quickly, new Apple watches, major new features, more aura with light in terms of there being a new readiness
10:22app and improved heart rate fencing.
10:24So nothing major on the watch, but nice little tweaks to stay competitive.
10:27Good stuff.
10:28Can't wait to see what you think once you get the phone in your hands.
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