Apple Pay & Health Kit: Furthering Medical Data

I've finally adopted the use of Apple Pay on my Iphone and the experience has been pleasant. Yes, if you compare pulling out your phone with the act of pulling a credit card out of your wallet, it may not seem that different. Before the Apple Watch makes payments as easy as a wrist movement, let me iterate some tangible benefits of Apple Pay usage on a mobile phone.

1. Security. Lose your wallet, and someone will be able to take your credit cards, forcing you to get new cards and put through fraud activity. Lose your phone, and they cannot access your cards without your fingerprint.

2. Convenience. It is easier to move a phone towards a payment reader and use a fingerprint to pay then to take out a wallet and remove a credit card. Swipe and put everything back. Let’s be honest, your phone was probably already in your hand while you waited on line. Just leave it there.

3. Receipts. Never worry about the annoying paper receipts that end up in your pocketbook or pants pocket only to be thrown out later on. The Apple Pay app keeps your payments listed neatly under each card. So you can quickly check whether the charge was correct or not. Without logging on to your bank I might add.

Receipts neatly featured within Apple Pay.

With these features in mind, let me describe a situation where Apple Pay benefits consumers beyond just convenience. It will also make us healthier. Here's how.

I began my use of Apple Pay by purchasing breakfast at Duane Reade. Some mornings I will grab an orange juice, banana, yogurt or some combination and head to the register, where, instead of taking out my wallet, fishing out a credit card or cash, I simply take out my phone, click passbook and hold it up to the reader. My phone buzzes and prompts me to verify payment with a fingerprint scan. A split second later, the transaction is complete. Afterwards, a notification tells me that the payment was processed and I now have a mobile receipt on my Iphone. Simple enough, but what if the items I purchased were instantly integrated into the health kit application. So the vitamin content, sugar content, caloric content is all seamlessly recorded in my personal account. People today looking to keep track of what they eat and drink must manually select each item, at the most they can hope to scan a barcode and have it enter, which is what FitBit’s app achieves. However, that is cumbersome and annoying, especially for those in a rush. With this setup, each mobile device user will have an entire history of their nutritional intake in the health kid app. Doctors will be able to pull up the profile of a patient and get a clear picture of their habits. Researchers will be better able to discern what diets and what foods cause disease. Or what foods and drinks prevent disease.

It is obvious mobile payments are going to become more and more prominent in the future. A small convenience can go a long way for consumers. However, the real takeaway so far is this thought of how to interconnect mobile payments and the health kit. That sounds like a healthier future for everyone, as each person is better able to understand what they are eating and can speak to the doctor about how their diet effects them. Not to mention the enormous amount of data this will provide medical staff, making it much easier to correlate factors that may cause various diseases. Mobile data and new technologies will revolutionize healthcare, how many times have we heard that? Every day it becomes clearer that this will indeed become a reality.

Book Spotlight #5: Of Mice and Men

"Of Mice and Men" 

By: John Steinbeck

Quote Highlight: "Guys like us, that work on ranches, are the loneliest guys in the world. They got no family. They belong no place... They ain't got nothing to look ahead to." - George

One of John Steinbeck's Great Depression era novellas. This is a rather short story following two close companions, George and Lennie. The two travel through 1930s California from town to town searching for field work on a ranch. They end up at a place run by the owner's son, Curley. The pay is $50 for a month of labor but they both dream of a day working on a field they own. As soon as the pair show up at the ranch, it's clear that this place might be trouble. Who they meet and what occurs on Curley's ranch is what you'll have to read to find out.

One striking aspect of the story is how far ahead of his time Steinbeck was with his portrayal of Lennie. A man with a severe mental disability, he can barely remember what his best friend George told him just an hour ago. Steinbeck takes us inside the mind of this physically giant but mentally small man. A man with a genuine heart who finds he can do no right in a world that provides little help. George is quick to tell him how great it would be if he could leave Lennie behind and stop caring for him. But George also has a soft spot for Lennie for his own reasons, and continues to look out for him. The reader is left to speculate how exactly Lennie came to be the way he is, I found myself attached to these two characters that Steinbeck introduces just briefly. It's intriguing to read the interactions that Lennie has with other characters throughout the book. The reader is able to get a quick glimpse of people's attitudes towards someone with a mental disability from the vantage point of the 1930s. I found myself wondering if people's attitudes towards someone like Lennie have improved over time? 

The reader will come across some familiar social themes of the time as well. Woven into the story is Crooks, the black stable hand. There is also only one woman in the novel, known simply as Curley's wife. Steinbeck does a fantastic job of allowing the story itself to unfold in a way that allows the reader to quite clearly understand the theme coming across. Yet, it doesn't dilute the quality of the plot, simply enhances the depth of it. The reader is left with a quick story that packs a lot of punch.

I leave off with a high recommendation for this novella. It's a quick read, running only 100 pages or so depending on the version you have. If some of Steinbeck's lengthier novels scare you away, start off with this one and see if you get hooked. After burning through 100 pages, you may find yourself wanting more... and that's a good thing.

Twitter Q2 Earnings: Users Growth Officially Over at Twitter

Even the executives at Twitter have finally acknowledged the companies' biggest issue: a lack of user growth. On the earnings call yesterday, Interim CEO Jack Dorsey spoke about how the current user growth numbers are unacceptable, while CFO Anthony Noto claimed any new increase in users would take "a considerable time". Clearly not something investors wanted to hear, the stock, which was up over 6% after hours, plummeted 12%, opening today around $32 a share. The only positive was a beat on revenue and EPS, though the company still has yet to turn a profit. As the executives seem to be taking a "long road" and focusing on monetization now and growth later, the company could be in some serious trouble. The focus for social media companies in particular, where being cool and hip is highly important, is to get as many users to join as quickly as possible and worry about monetizing their user base down the road. (I've been writing about the issue of user growth since February: Link Here). In my view, this was another terrible quarter for Twitter, a growth company shouldn't care about increasing revenue so soon, the focus should be on user growth, a number that has been slowing for months now. Finally, the executives mentioned the problem, but not in the right way. The rudderless ship looks sure to continue to drift. Below, we look further at the user growth problem.

Monthly Users were up 15% year over year, due to an increase in SMS based users.

User Growth Up? Not so fast.
The small increase that Twitter saw in user growth came from SMS users. So what exactly is an SMS User? Essentially, these are people who sign up for specific text message alerts of tweets they deem important. So a baseball fan may want a text when Derek Jeter tweets his return to the Yankees. These users DO NOT need a Twitter account to sign up for this service. SMS users do not even have to open the Twitter app to access these tweets, they will only receive it as a text. Twitter is happy to let these users fall to the wayside, why open the app at all? In the meantime, Snapchat/Facebook/Instagram and others will continue to build up real time news stories INSIDE their apps. Alternatives to what twitter does will grow everyday. Almost every other week Snapchat launches small tweaks to it's app, Twitter hasn't had any major product innovations at all. Twitter might also have to start worrying about a drop in the value of its network, as more people leave the service for other competitors, the less valuable it becomes for those left to have a twitter account. This is because people will find less of their social network, whether friends or professional, using the app, thus Twitter loses more of it's drive for users to continue using the app. This can snowball rather quickly, especially if users have alternatives and are flooding to another service (such as Snapchat or Instagram). For anyone who downplays the significance of this, think back to how quickly Blackberry fell from grace. At the end of the day, excluding these pretend SMS users, Twitter had no user growth. No one is joining the service anymore, because, why should they? 

More Executives Leaving
Not to mention, two executives are leaving the company, continuing the fast swinging door that has become the norm at Twitter. The head of GROWTH at Twitter announced he will be moving on to better things at YouTube (owned by Google). Additionally, a product director is also be jumping ship, heading over to Dropbox. Twitter has yet to find steady leadership, a troubling note. Looking around at other success stories, there is almost always a strong leader with a clear vision of the company. Tesla and Elon Musk, Apple and Steve Jobs, Microsoft and Bill Gates, Virgin and Richard Branson, Facebook and Mark Zuckerberg, . These names become synonymous with the company, Twitter lacks this vision and leadership, another troubling sign.

Apple Earnings: Investors sell on earnings beat

Apple is opening today down 6.5% at around $123, lower then yesterday's $130 pre-earnings close. Hearing this, one might think earnings were disappointing, yet the opposite was true. Revenue and earnings were higher than expected (Q3 earnings per share estimate was $1.81, Apple reported $1.85 , revenue estimate was $49.43 Billion and Apple reported $49.6 Billion) These were high expectations to begin with, with many analysts ratcheting up estimates in the lead up given Apple's record with earnings beats, and Apple still beat. This steep drop in stock value seems to be investors disappointed that Apple didn't beat by much more, which doesn't appear to be very rational. I will go over each product category and why I think that Apple is poised for more growth and is a buy after this current sell-off.

Iphone
Everyone was focusing in on this product, would sales slow down from it's incredible speed. Apple sold almost 50 million Iphones in the quarter, with sales jumping by 35% year over year. This at a time when when many people might be holding off to buy the newer Iphone 7, which will be announced in September. Where is the problem? Numbers on the Iphone continue to impress, growth in China continues to impress, users continue to upgrade to the newer model, and Tim Cook claims this quarter had the most people switching from Android to Iphone ever. Consumers have chosen the Iphone as the prized mobile phone.

Apple Watch                          

Getty Images

This is one area where many investors are getting anxious for immediate results. Apple has yet to release sales data for the watch, though Tim Cook said that sales have "beat internal estimates". That sounds good to me, and before launch most investors were saying the watch had zero impact on the bottom line anyway. Now everyone is worried that the watch is not taking off. This is a product line that won't explode like the Iphone, it's an entirely new category with an entirely different objective. Though Tim Cook said sales of the watch were higher in June than in the previous two months, so the watch could already be gathering speed. Wearable technology will grow, albeit steadily. The apple watch will benefit from that growth, and at an average price of $600 per watch, this product line will have a sizable revenue in the future. Investors seem to be short sighted on this, wanting big gains now. Maybe people are spoiled from the massive success of the Iphone. Time will tell.

Mac Sales
Sales of the laptop grew by more than 9%, at a time when PC sales are falling around the world. Investors seem not to care about this, but this development shows that people are investing in the ecosystem. A phone, computer, watch, TV, all will go together. The cost of switching one or the other goes up the more Apple products you have. With Tim Cook speaking about android users switching to Iphone, it becomes a matter of time before they also ditch a windows computer for a Macbook.

Ipad Sales
Sales slumped here again. To me, this is a niche product, it's a convenience, especially with phone screen size increasing. If someone is invested in the ecosystem, they might purchase this for their daily commute or for work. Households may purchase an Ipad for their children, however Apple continues to push for businesses to adapt Ipads. This might continue, with some cash registers switching over to Ipad use. However, I don't see this category blowing out expectations anytime soon. That's just fine with me, with yearly improvements, the Ipad isn't going away, it just isn't going to grow like the Iphone.

Apple Pay
Barely even mentioned, Apple Pay has just launched in the UK. Another new innovation that more and more people will continue to adapt around the world. The ecosystem for Apple is growing, and the watch will make Apple Pay even more viable, allowing users to purchase items by just holding out their arm. It's just another reason to own the watch or Iphone. Small innovation can go a long way.

China
Investors also seem worried about growth in China given the recent stock market collapse there. Yet overall sales more than doubled in the region, and Tim Cook continued to be optimistic about further increases in sales, as the company plans to open more stores there. As the WSJ pointed out Iphone sales in greater China rose 87%. That hardly appears to be a slowdown. No one seems to speak about the network affect as well, as more people in China purchase an Iphone, it becomes more valuable and more wanted due to network effects.

Conclusion
Apple continues to print money from it's ecosystem, especially the Iphone. With over $200 Billion in cash, a stellar product line with continued innovations, the company is positioned well for future growth. Not to mention the stock is trading at a discount relative to the rest of the market with a P/E around 15. I recommend AAPL as a buy here, I see no major slowdowns in Iphone sales which worries many others. The watch will continue to catch on, along with improvements in the Apple TV and possibly even an Apple car ecosystem down the road, this company will continue it's dominant growth in the tech industry. Buy low, sell high. Now is the chance to get it low.

Instagram Rolls out Live Trends: Competition for Twitter

The New Discover Page

The Wall Street Journal User Account

Instagram is rolling out a new feature for to make finding trends easier for its users. Today, in a blog post from the company, Instagram declared that users will now be able to "See the World as it Happens". Might sound familiar. Social Media is becoming more and more about the live event. What was once Twitter's advantage, is now everyone's ballgame, both Instagram and Snapchat have been updating their products consistently to advance the real time activity of their app. And, if you thought hashtags were exclusive to Twitter, you'd be wrong. Check out the front page of this feature on #Instagram. This goes to show, once again, that there is nothing distinctive about Twitter that cannot be quickly adopted by other services. Right now, the biggest draw to using Twitter is to find out about ongoing events, live action events. Users also follow celeberties and news anchors accounts to get updates, however more and more of those users are moving towards Snapchat and Instagram instead of Twitter. If Instagram and Snapchat continue to move onto that turf, Twitter (with it's CEO on the way out) could find itself battling to stay relevant in this fast paced duel of social media giants. 

Personally, give me a reason to go check my Twitter feed or search a trend when I'm already on Instagram or Snapchat. Just the other day I noticed (thanks to Instagram's fantastic prediction algorithm of what I might like) the Wall Street Journal had started two Instagram accounts. I now follow both. And I haven't checked Twitter in quite a while now....