Mark Gurman: MacBook Neo is a game changer, but Apple's AI is still a mess

is the leading AI trust management platform. We have Mark German, the Germinator. He's journalist at Bloomberg and he's here at in the TVP and Ultradom. How are you doing Mark? to see you.

Great to see you.

Been good. Wearing my uh Apple sweater today in honor of the the conversation.

Very nice. And what is behind you? You're in Los Angeles.

Has there actually ever been a day where it didn't make sense to wear your Apple hoodie?

Yeah, like if I go to a Google event or a Meta event or something, probably not wear the Apple hoodie, you know. But uh

Well, take uh so take us through uh your predictions. Anything that surprised you? What was actually released? Like what have the last few days been like for you? Uh last few videos have been interesting. You know, 6 a.m. Pacific time they've rolled out the the new products. Monday started off with the iPhone 17e uh and the M4 iPad Air. Tuesday obviously was a big Mac day with the M5 Pro or M5 Pro and M5 Max, MacBook Pros, the M5 MacBook Air and the two new studio displays. Then we got the big one yesterday on Wednesday, obviously the MacBook and Neo. Uh in terms of surprises, there were no surprises. Uh these were a bunch of products that had a lot of pent-up demand. They needed to roll out a new iPad Air.

Yeah,

sales have been flagging there a little bit. It was time for them to roll out the iPhone 17e. And obviously this new cheap MacBook has been in the works for for several years. The MacBook Pros with the M5 Pro and M5 Max, some may have expected that last October because that's traditionally when they've done the MacBook Pro updates. Uh but this time around, the the chips weren't ready until recently. uh they use this newer generation TSMC fabrication technology. So those rolled out uh for the spring. So overall a really nice set of updates. Think it'll help Apple have a really strong quarter. Remember they guided uh an extremely strong March quarter. Uh we had a feeling we knew why, but now we know why for sure because all these products are now hitting the market and I think at 600 bucks at 500 for education uh the MacBook Neo is going to be a gamecher not only for the computer industry but for Apple's bottom line. Was there any conversation about Mac minis?

Uh, no. No, just uh just on Twitter. Everyone wants a new Mac for Yeah. Open claw and all the AI stuff and everything going on there. Yeah.

Uh there'll be an Mac Mini this year, but I'm not expecting it until uh closer to the end of the year.

Yeah. I I I I'm just thinking of like uh if you get a Mac Mini, you need to plug it into something. You need a display, you need a keyboard, mouse. Like there's a lot of extra features that drive up the cost. And um it's people aren't actually buying them for the power of the Mac Mini. They're buying it just to be able to interface with iMessage. And so the MacBook Neo might actually sort of displace the Mac Mini potentially because you have I mean not if you're wiring them all together or something, but I'm wondering if there's any like odd unpredictable orthogonal uh purchasers of Neo or is it just like the Chromebook market, but I don't know.

Well, I think it's a secondary computer market also, right? Like I have this big 16-inch MacBook Pro that I need to lug around. For 500 bucks, I can get something at half the weight uh and you know, half the volume that if I really need it to take to an event or for a flight and have Mac OS, something a little bit more formidable than iPad OS, uh it's a great alternative. So, probably not going to do it.

Uh I'm saving uh uh my Mac budget, I think, for this uh big MacBook revamp in the fall, the touchscreen version of the MacBook Pro. Yeah.

Uh with OLED, I don't really need the Neo. I can I can get it. I really wanted it. Uh but

definitely I think it's going to do well and crush the Windows PC market, right? I mean, if you look at the price point,

is it is it is it surprising that uh that it took this long to come out with a device that was going straight for the jugular with the the everyday PC market. I think um you finally had alignment on the chip side to be able to do something like this and the A18 Pro that just came out a couple of years ago that is on par with an iPhone or a Mac grade chip, right? You can really run benchmarks and see that it's probably close to an M1 or M2 or even an M3 in some, you know, single uh thread use cases. And so that chip coming out and Apple rewriting Mac OS a few years ago to be able to run on these ARMbased chips as part of the transition away from Intel is what allowed this to all come together. So it took a long time. This would have been very difficult for them to pull off in the Intel days. Would have been very difficult for them to pull off five years ago, but once they had alignment on all of those factors, they were able to do it. One thing that they didn't really talk about uh yesterday with the launch is another factor here was a new aluminum based manufacturing process that has basically allowed them to save more aluminum, reuse aluminum scrap metal and build these machines in volume uh while saving a lot of the manufacturing costs. And so that's a big part of how

should I buy a MacBook Pro or should I wait for this touchscreen OLED uh new fangled thing that you just described? Uh, you humbled me by telling me that my MacBook Air did not have a good display. I never want to make the same mistake ever again. But at the same time, I'm not really convinced that I need a touch screen. What What's the tradeoff right now?

Well, you've got the what, the 13-inch air, remind me, or the 15-inch air.

15-inch Air.

I got the big I got the big small one. The small big one. I don't know.

It's a good machine.

It's a good computer, sir. Yeah, I mean I think you just wait for the OLED. I mean, we're talking about screens here. You want to have the best screen, it's the OLED. Whether you use the touch or not,

it's a breakthrough difference. You know, one thing on the uh on the MacBook Neo, the the screen technology that they're using is actually a different type of screen tech than what you're getting on the Air. Okay.

And so, I would say the Air is like pretty like down the middle. It's pretty good.

Yeah.

The OLED is like huge step above. And the screen tech they're using on the MacBook Neo, it's a step below. And if you just like if you use the Pro, the Air is not going to look so good compared to the to the Pro.

Yeah.

If you use an Air, you're going to see the Neo screen. You're going to be like, "This is subpar."

Sure. Sure. That makes sense. Uh talk about the naming for Neo. It's the first time Apple's ever used that phrase. They had nano right there. They didn't go nano. What do you think they mean by Neo? Why that term? How's the response been?

I think they wanted something cool and futuristic. I wanted I think they wanted something to show that this was something entirely new

and I think they were looking for a new cooler term than SE.

SE had been sort of their term for these lowcost products in the past. You have the Apple Watch SE. Uh they used to have the iPhone SE. So they're clearly trying to move away from that SE naming and it seems to me like Neo is that replacement. So I wouldn't necessarily be surprised if we eventually see them rename the low-end products to all be part of that Neo

family. And so what they've basically done is they have like Neo at the base.

Air is the midterm and pro is the highend and then they've got things like ultra and max uh to differentiate further at at the high end. And so I think this strategy they've always had which was good, better, best, you know, lowspec, midspec, high-spec, they just have their fancy marketing names for it. And I think Neo is a really great name. And just like Air was a super catchy name back in 2008 when Jobs and built the first MacBook Air, now that Air name is across the whole portfolio. Yeah. I think Neo has that same potential. It's three letters. It's cool. It's memorable.

But if I were Tabarazza in charge of naming products at Apple and I was given the iPhone lineup, I would probably go iPhone 17 Pro, iPhone 17 Air, which is not what they did. They just did iPhone Air, then iPhone 17, and then iPhone 17 Neo because I like this new term. Instead, they did 17e, they did Air with no number. What's the thought that there?

Well, I feel like on the phones, they've always just been completely all over the place on name. They basically become like Samsung or Android.

Yeah.

Uh I remember when they launched the

iPhone uh what was it? The the the XS Max. iPhone XS,

right? and you have the the Pro Max, right? So, you're just jumbling a bunch of names together. I think over time it'll it'll become a little bit clearer.

In terms of iPhone naming conventions, those are harder to to strip away because um

you have case makers, you have carriers, you have people uh around the world who are used to these naming conventions. So, changing the naming structure on the phone is is much more difficult than doing it on like the Mac or the iPad. Got it.

But I'm sure we'll get there eventually for simplicity. you know, they're still doing

what what what what's playing out right now in the low end of the smartphone market in the US.

Well, the low end of the smartphone market in the US is is is not so great. I mean, you've got some Samsung's there. You got some of the phones made from some of the Chinese phone makers that people are importing here. Uh but in terms of the price point, Apple really abandoned the low end of the phone market. At some point, you had I believe the SE was 350 bucks. Then it eventually went up to 430 bucks. Now it's 600 bucks. So I would say Apple's basically given up on the on the low end of of the phone market. They're playing in what we call the mid tier of the market. And I

it's so interesting to go lowend on the computer on the on the PC side, but not but stop competing on the low end on the phone side. Just give given that I don't know. I mean, growing up there was just like such such a big divide. It was like it was Apple PCs were luxury products.

Mhm.

They really didn't care about the low end.

Calling it an Apple PC is hilarious.

Personal computer.

Yeah.

The divide is gone now. And you know what I think this MacBook Neo is going to do? It's not only going to help with Mac sales, but it's going to sell a lot more iPhones and Apple watches and iPads. It's bring a lot more people

into the ecosystem. So, you know, for Apple from a business standpoint, you know, they've always said they're not going to cheat ship, you know, cheap products to shape to to chase market share.

Uh, that's clearly changed. Apple needs to do bigger and bolder things to expand its business and grow. They're in new markets. Uh, you know, Eastern Europe, uh, developing parts of Asia, India obviously is a big focus there. I think eventually they'll be, you know, in Africa as well. Uh, so clearly they they had to do this. It was decent timing for them. you know, there's all these concerns about recession and, you know, war and everything going on right now. So, a $600 MacBook, I think, is a, you know, pretty timely.

Yeah.

Uh, what what's new since we last talked on any any kind of leaks or insights on on their AI strategy and the and the roll out of the new Gemini powered Siri?

Yeah, the Gemini powered Siri was supposed to launch this month. They were supposed to hold an event in New York about two weeks ago to walk press through uh the new Siri. They've continued to face delays there. It was originally supposed to come out in iOS 26.4, which is scheduled for the end of this month. Uh now they're still splitting the features, but they've punted it to 26.5, which is supposed to come out May, June, WWDC time frame. So potentially some features then and then the rest of the features uh coming out at the tail end of the year as part of iOS 27. Uh my bet is that nothing significant will really probably come out until iOS 27.

Uh yeah,

not great.

Yeah. Is that that doesn't is that good?

Is that good?

Um

no, that's not good. No, that's not good.

Is part of that is part of that just like the management shakeups and you have new leaders, you know, basically

new leadership and it's sort of like, you know, we've taken this long.

Uh it's only going to be worse if we release it and it doesn't work.

Sure. Big other questions are like do people really care at this point? People are just going to use the chat GPT or the anthropic app or the Gemini app. Anyways, our our AI hardware is industryleading. We can run all these third party models on the phones through applications anyways. We might as well wait until we we get it right. Same with Apple's AI strategy. If you were to say that this was a strategy, uh then you know it's a pretty good look for them. But this hasn't been the strategy. They fell ass backwards into it to be completely honest with you. Right. The intention was never to fail to fail upwards.

Yeah. But they did. It's Yeah. It's fascinating

strategy. We fail upwards

for now. For now. Yeah. But I mean they have to be looking at the at the revenue curves of uh of Chachi PT and and OpenAI and anthropic

significant growth lever for them.

Yeah. Yeah. Yeah. It's a it's a huge growth lever. It's a huge market and you can see the way Mark Zuckerberg's positioning to like make a real play into Gen AI in some meaningful way and uh he's taken a very very different approach been honestly slower on actually releasing features but uh just feels like he's taking it a lot more serious a lot more DNA there.

How much are you planning to cover OpenAI's hardware? Is that going to be in your territory at Bloomber?

Front and center. Front and center and center. Okay. So, give us give us your how have you processed the kind of the leaks? We had uh we had the the dime leak around the Super Bowl which looked like

I don't think it was real. I mean, I don't Everyone I spoke to says this is not a real product. Uh it's

Yeah, but then Joe Gia is sitting there in San Francisco using it like this week at a coffee shop

which didn't exactly look the like the most organic.

Yeah, there's a lot of conspiracy around it. And if if the if the daimad was fake,

then it was

an incredibly good model because I forget the name of that actor,

but

Scarsgard.

Scarsgard.

Scarsgard. Yeah.

Yeah.

But it didn't look It looked like Okay. Leading frontier video model.

Yeah. Yeah.

Well, maybe it's a teaser or models, but but here's the thing.

Yeah.

The hardware is going to be beautiful. We know the hardware is going to look great. It's going to be designed by Love from Johnny IV, all those guys, the former Apple people. There's no questions there.

The big question is who's going to buy these things, right? Like are people really going to trust OpenAI as a hardware company

and Apple has this ability to fast follow? Let's say Open AI does come out with something pretty nifty. What stops Apple from copying it immediately and taking all their market share? Apple has the retail stores. They have the privacy story. They have the brand. Y

OpenAI has this great AI brand, but they don't have a hardware brand. And so it's almost like they have the opposite problem of Apple, but the leg up they have is that their underlying technology is clearly better.

Yeah. And there's this new there's there's rumors around their new uh voice model that they're working on. And so the question the question to me is like can they create a beautiful device and have a meaningful breakthrough on the model side

that somehow makes it uh more difficult for Apple to just fast follow. Right. Well, I would say, you know, for sure yes on point A, for sure yes on point B. Maybe yes, maybe no on Apple's ability to fast follow based on the models. But I just think the bar to sell people hardware, even if it's good and even if it comes from a big brand.

Yep.

It's a really high bar. Yep. It's a really high bar to sell in these Apple like quantities. I mean, even look at Google in terms of their market share and their hardware. They have amazing software and they have amazing hardware and they have the best advertising for consumer electronics uh for phones at least in a very long time. I think talked about the ads last time I was with you guys.

Yeah.

And uh they've made little to no dent

and obviously there's big questions there. In fact, Google should even be doing hardware.

Yeah. And meta ray bands too. You open up Instagram and you see like a fullble bleed special modal ad for Meta Ray-B bands and they're doing okay, but it's not, you know, 80% of the population.

The Meta Ray-B bands are considered a smash hit and they've sold fewer than 10 million units.

Yeah, it's not a lot. Yeah.

Uh Apple sells 10 million units of uh AirPods watches. Yeah. Probably probably a quarter.

Yeah.

So, the bar is just unbelievably high.

Yeah. What's going on with the Meta with the that lawsuit with Meta? They had contractors that were just able to view the recordings of Meta Rayban users.

I missed that.

I haven't I haven't covered it or I haven't followed it very closely.

It's great. It's crazy. This is reminiscent of when people figured out that Apple with Siri and Amazon with Alexa and Google with Gemini had these folks. They're called um annotation analysts who listen to everything you're putting into the voice assistant and they're comparing it to the outputs. So they're listening to the raw audio and comparing it to the outputs. So what Siri thought they said and so they're able to correct it manually in order to improve the underlying model.

And that was a big blockbuster when everyone discovered that that was happening a few years ago.

This is not audio. This is camera footage. This is people in potentially uh you know uh intimate moments and this is not just what you're saying or facing you, it's what you're seeing while wearing these glasses everywhere. And so I think that raises really big questions about the smart glasses category. When Apple releases their smart glasses, they're going to have a big focus on privacy, a big focus on uh seeing the surrounding environment for you. Uh, at the same time though, I don't think that this changes uh the overall equation for smart glasses. I still think that this has been a successful pioneering product for Meta. I still think they're pushing forward here. I still think they're going to release several new models that I'm, you know, based on what I'm hearing are pretty uh exciting there too for the for the Meta smart glasses, but will they need to make some privacy adjustments? Yes. But I think in this case with the smart glasses, the first mover advantage is real and and Meta has that. And in terms of glasses, they've got the biggest partner with Extra Luxotica.

Yeah, that makes sense. Uh, talk about the Studio Display XDR. Is this a complete replacement for the Pro Display XDR? Okay. And and uh how are they pitching this? Yeah.

Well, this is it's pretty expensive, right? Uh $3,300, but it's still much better than uh what you had before. Remember when they announced the the Pro Display XDR? People lost their collective minds when the stand, right? So, you got the monitor for five grand, but then the stand came separate, which is ridiculous. Yeah. And that was a thousand on its own. People lost their minds. And now you can get two MacBook Neos for the same price uh as that stand with an education discount. So now they've been able to go a little bit down market on the monitor. It the resolution isn't as high as what they had before. It's not like they went up to a 7K. you have a 27in panel instead of a 32-in panel. There's a lot of savings on the shipping and the logistical side and the product engineering side with those products. So, I think this new Studio Display XDR is going to be pretty popular. I'm actually probably going to get one uh myself uh for my office at home. So, I'm pretty I'm pretty pumped for it.

So, grab the Studio Display XDR, but maybe wait on the MacBook Pro.

Yeah, you know, I need the most reference monitor like quality. I need medical images. I need all of that, you know, my very intense engineering work. uh in lives. But

I ordered I ordered the new uh MacBook Pro Max.

Yeah,

I got 48 gigs of RAM. It was like 6:15 a.m. I was at the gym. I just went through the order flow pretty quickly cuz I wanted to be

first in line and then I realized I didn't max out the RAM and I tried and then I was on the Apple support saying, "Hey, can you just switch me for uh uh the version with with more RAM?" And they said, uh, I was not feeling the AGI in that moment because they said, uh, you have to cancel your order and re and place a new order and lose your spot in line. By this point, it was like 5 6 hours later.

And I was like, how how how do we not have the technology for this?

Just swap this. Yeah,

it is. It is wild. But so question for you. Why get this M5 version knowing that they'll have M6 version with OLED and touch in six months? I cannot stand when people touch the screen of my computer. And so I don't even want I don't want to give them another reason. They already seemingly have enough reasons. People come around here at the office, they're

they're pointing and stuff on the screen. I don't I don't want them I don't want them to even be tempted. So,

uh, no, I mean, I I I I just look at I I think that, uh, computers are these amazing things that we use for something like eight hours every single day. uh at least of the of the work week and the their their cost relative to the value

is just so extreme that if the new device comes out in the fall and it's amazing then I would just

get that.

All right, fine. Maybe I'm going to have to get the M512 to hold me over to the M6. But, you know, one thing we didn't talk about is, you know, Samsung has this new S26s. Yeah.

Uh the Ultra version, it has this privacy display on it.

Oh, yes.

Have you guys seen these?

No, I haven't. I haven't actually seen the demo. I've heard of it. It sounds amazing. Explain.

So, the pixels turn off uh in certain places. So, if someone's re reaching over and looking at your screen, not touching it, uh but looking at your screen, uh they won't be able to see what's going on.

So, so on like in control center, if you're on a plane, you can basically, you know, how you have that uh polarized uh screen protector, you can effectively turn that on in software dynamically. So, you're on the plane and you say, "Yeah, I don't want this person reading my emails." Turn that feature on. It probably gets a little bit dimmer, maybe a little bit blurriier, but then when you're just hanging out by yourself, you can turn that feature off and get the full display resolution. Yeah. Really, really innovative. That's got to come to Apple soon. But talk about fast following.

Soon is wrong. Soon is wrong. Don't forget. Yeah.

This is this is the interesting thing about Samsung, right? Where they are the component maker and the hardware maker.

Yeah.

And the component supplier to Apple. There are certain things they're not going to want to give to Apple. Totally. uh because it's a it's a competitive advantage for their own hardware. We saw this with OLED many years ago where it took Apple I think four or five years to get OLED after Samsung. Yeah.

Right. Apple just basically the OLED transition a year or two ago. Yeah.

Uh on the phones at least. They haven't even done OLED yet on on the Mac. They've only done OLED on one iPad. Uh they'll have it on a second iPad this year and the others in the next couple years.

But this privacy display is I think a hot feature and it's going to be a few years at least before Apple's able to to to get it.

Yeah. This is my my overall skepticism. Like I completely agree with you on the idea that it's very hard to sell tens of millions of units of a new consumer hardware, but I just am not necessarily buying the idea that Apple can fast follow things that work because it took them a decade to get a VR headset out and it wasn't a smash hit and like they you know they they are like you know at least a few years behind on even the most basic little uh implementation features that happen. Let's, you know, let's say Open AAI does earbuds and uh they have these remarkable AI features.

You know, Apple could cook up some new models with Google and try to get

in software, you know, within a year.

Yeah. Yeah. It's hard to imagine the the suite of Apple products on your body across vision, watch, phone in your pocket, laptop, and uh AirPods like not being able to satisfy like your demand for AI. So, I completely agree with you on that. Well, the question is are like do people actually want these things, right? Like we talk about these AirPods with cameras, we talk about these smart glasses, we talk this pendant, we talk about a pin, talk about whatever

smart staff.

Yeah. I mean, none of this is not proven. These are not proven products. Yeah. Right. Like 7 million units on meta glasses is really successful. Uh but it's not proven at at Apple quality and Apple caliber. I mean there could be a situation we look back a few years from now like say this whole AI hardware thing was just a big you know whatever and people are just still glued

to these things so

we'll have to see what happens but at least Apple's going to give it a shot.

Appreciate it. Well thank you so much for taking the time to come talk to us in a busy day. Always great to see you guys

and have a great rest of your week. Talk to you soon.

See you next time.

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