Why Apple Intelligence will be focus of iPhone event

after the NASDAQ Composite logged its worst week since June of 2022 here and apple one of the index's Heavy Hitters is moving to the upside this morning the tech giant will kick off its annual iPhone event in copertino California later on this afternoon and so for more on what we can expect from the event we've got Bob O'Donnell Tech nalysis research president and chief analyst here great to have you here with us Bob to kick off the show uh first and foremost let's start with the big news that is Apple expected to come later today new iPhones Apple watches what is the product here especially as it's usually the smartphone that is expected to take the cake here at least for consumers and investors that are paying close attention to where the stock may move thereafter well you know the BR the thing is and I've been going to these Apple events for years and years I'll be there again uh this morning it's always been about the phones right the fall launch event is the big phone launch event and people get excited about that or at least they used to the challenge is we're in an era when a lot of these iPhones look the same this year's new versions are expected to be incrementally better but not hugely different I think honestly a lot of the focus is going to be on the Apple intelligence AI features because that's the exciting area like what is Apple doing here of course they announced some of this at their WWDC conference earlier this year but the question is how does it get implemented what's it like to use you know does Siri actually become smart and this is all important because Apple has said look if you want to use these new capabilities you're going to either have to have an iPhone 15 from last year or the new iPhone 16 and of course A lot of people are sitting on 12s and 13s and 14s and so the question becomes if this these software capabilities are compelling enough to get those people to upgrade their iPhones that's the market we're in these days it's an upgrade market right that's where all the sales happen so that's what I'm certainly going to be watching but there are implications about this because most of the focus of course has been on the US implementations of these not even seeing it happen in Europe let alone China and of course there's a lot of questions about what I AI capabilities apple and others will be able to bring to China so lots of questions lots of Interest lots of excitement but it's kind of more of a software Focus I believe uh in the end Bob how much of that excitement do you think has already been built into the stock or pricon that's a great question Sean I mean to be honest with you because of what I just said most of this stuff you know everybody knows what's going to be happening I mean who knows maybe they'll surprise us sometimes they do I haven't gotten the sense that may would be the case you know and and obviously they're going to have new watches which has been a growing part of Apple's business the airpods as well rumors maybe of an iPad mini but again that doesn't make or break things so most of this stuff I think is built in the question will be you know has Apple cracked the nut on the ability to make AI useful for a lot of people we've seen Google and Microsoft and others introduce AI Focus Features and they're kind of fun but they're not something you're going to use every day and in my opinion you know Apple's really good at UI can they be the ones that start to say hey here's how you integrate Ai and normal people go oh wow this is what I got to have and so that's the part that could be the upside surprise yeah to partially quote tlor Swift this morning here Bob I mean it's me I'm the problem it's me I have an old Apple watch I have an old 12 uh Pro Max iPhone I haven't felt the need to upgrade what percentage of the install base though do you think needs to be so enamor so fascinated by some of these new features that might not come till later this year based on some of the the OS delays that we had heard about what percentage of that install base needs to be able to and to upgrade and take on new price as well in order for this to flow through to Apple's financial performance it's a good question Brett I honest I don't know the exact percentages I mean there are a lot of numbers being thrown out out there but you know look it we are in this era of 4ish to fiveish year phone Cycles just like you're describing which would imply you know there is only about 20% that have an iPhone 15 which means there's this huge 80% chunk um that are part of what they want to see move now they're not going to get all of that obviously and I'm not sure that this is a super cycle year that some people said because again we're not seeing a whole lot of Hardware implementations you know there's no foldable iPhone yet eventually I'm sure there will be but we're not there yet that will trigger huge changes so you know it's again it's going to be an interesting thing to watch and again the other question as I said is the um the other International side of this and what happens how they deploy this in the EU and various countries there and any regulations of course that occur and that's not just for Apple but for everybody so you know I I think it's interesting but I think it's more of a long-term play one of the problems I think we're seeing in general with the market hearing you guys chat is people are expecting this that all this AI stuff is like bam immediately G to impact everything it's like guys that's not the way this works and it's not it's going to take a while uh so you know the question is PE do people have patience in the market they typically don't so you know we are where we are Bob another big event that's taking place in in the tech world today are starting I should say is Google's antitrust trial and of course the focus of this trial is on Google's advertising business I'm curious just from your perspective talk to us about what's at stake and the significance of this trial maybe some of the implications here for not only Google but some of the other larger Tech Giants sure Shauna no I mean this is an interesting one it's it's a really kind of a complex story because it's not about Google's ad business it's about their ad selling business so behind the scenes and this is something we don't typically interact with there's a big Marketplace for buying and selling ads on websites and what have you and Google has had the tools to do that and are the government is arguing a monopoly in that particular area now you know it's it's you know it's hard to figure it all out in all the pieces because it's not even all the ad business it's not the adword it's uh the other partion and even if worse comes to worse something happens and and oh by the way this is all going to take years and years and years because that's how doj stuff is even if something happens and they have to sell out that little piece nothing that you or I interact with with Google would change right this would be the businesses that interact with and buy ads via Google that would change obviously that's important to alphabet as a conglomerate uh and there's certainly a question of what that impact would be most of the uh suggestions I've seen have been you know pretty small all right Bob odonnell always great to get your Insight thanks so much for hopping on and joining us here this morning a tech analysis research president thanks so much Bob