Tim Cook Steps Down — With Joanna Stern

0:00Big Technology Podcast Host:Hey everyone, well, big breaking news, we're here with Joanna Stern of The New Things and the author of I Am Not Robot, and I'm going to break this news to her right here on camera. Joanna, Tim Cook has stepped down as the CEO of Apple, and John Ternus is going to replace him as of September 1st. Wow. So, Joanna had no idea this. This happened as we were recording an episode. That episode will come on Big Technology Podcast pretty soon, but we're just going to get this out here now, and this will be a bit of an emergency show. So we have 15 minutes. What do you think about the significance of the news?

0:35Wow, wow, wow. I'm like scared to go look at my phone right now. I mean, shocking in terms of timing, not shocking in terms of the choice and that it's happening. I think we just kind of thought this was going to be pushed down the road a little bit. What do you think?

0:52Big Technology Podcast Host:The timing I thought was going to happen this year. Yeah. It obviously puts Apple into this sort of uncharted territory. Yeah. You could have seen Tim Cook as an extension of Steve Jobs. Ternus is pretty young, so it's definitely going to be a brand new era for Apple. And I also am curious what you think about this. He's the senior vice president of hardware engineering. Yeah. In an age where AI is going to really factor a lot. But I'm curious if someone running hardware engineering is the right choice for Apple. What do you think? I mean, it's it will be very interesting to see how a company that has none has recently become an operation.

1:37I'm not recently since Cook took over is really an operations company. Right. That's how he steered the company post jobs. And he left all of the other hardware and the software stuff to his deputies. Right. He put great people into those positions, sometimes not as great people as we've seen a lot of turnover. And now it kind of flips back. It goes back to someone who's very interested in the hardware, the design, the actual products, which, you know, can only, I think, be great for Apple as the company that makes the best tech out there. The question becoming, though, what Cook did on services, what he did on the supply chain, what he did in all of these other things is the really big question.

2:23Big Technology Podcast Host:Here's a letter, community letter from Tim. For the past 15 years, I've started about every morning the same way. I open my email and I read notes I received the day before from Apple's users all over the world. You shared little pieces of your lives with me and tell me things you want me to know about how Apple has touched you, about the moment your mom was saved by her Apple Watch, about the perfect selfie you captured at the summit of a mountain that seemed impossible to climb. You thank me for the ways Mac has changed what you can do at work and sometimes give me a hard time because something you care about isn't working like it should.

2:56I mean, I think that, like, that beginning of this is obviously

3:00Big Technology Podcast Host:his resignation note, that beginning of the note really, it sort of captures what Cook has been so good about, good at, And what has sort of been surprising about his ability post-Jobs is that he carried the Apple narrative, right? I think that, you know, someone coming from operations, moving, you know, taking over leadership from someone like Jobs who was all about the story. The real unclear thing at the beginning of Cook's tenure was just like, can this guy keep the story going? And he did. He did. He really did. And that sort of, I mean, I, you know, we'll see if Ternus is able to keep it through, keep that going.

3:38Big Technology Podcast Host:But I think that's just something we should talk about with Cook. It's going to be one of his biggest legacies is he kept Apple, whether it was through his showdown with the FBI around privacy, the navigating like the tough political waters that a company like Apple does. Right. For better or worse. Right. Because certainly there's criticism of how much he overindexed on China and, you know, many about the gold bar in the Oval Office. Right. But he kept the story. That's tough. And that'll be the challenge, I think, moving forward. And look, he was great. Look at the products that came post him.

4:11I mean, post jobs. I mean, there's we just we talked about AirPods. We talk about Apple Watch. We talk about I mean, I don't think enough credit goes to the investment in silicon. And, you know, whatever M chip you have in your laptop right now was a massive shift. I mean, like what they're now able to do in laptops and computing because they own that full stack. That's a cook thing. That was a cook move and like truly changed the computing industry, but also it's like fundamentally changed how that vertical integration has had to happen for other computer companies.

4:44Big Technology Podcast Host:Yeah. I'll keep reading if that's all right. Yeah, please do. Over the coming months, I will be transitioning into my new role. He's taking the next step of his journey at Apple. leaving my CEO job behind in September and becoming Apple's executive chairman. A new person will be stepping into what I know in my heart is the best job in the world. That leader is John Ternus, a brilliant engineer and thinker who has spent the past 25 years building the Apple products that users love so much, obsessed with every detail, focused on every possible way we can make something better, bolder, more beautiful, more meaningful.

5:15Big Technology Podcast Host:He's the perfect person for this job. Let me just share a piece of criticism of Tim Cook's Apple. And I'm curious if the lesson has been learned. And that is that, like, they have been so obsessed with every detail, focus on everything, every possible way to make something better. Right. The thinning it down, a little bit more battery life. And the criticism has been that by doing that, by making the iPhone thinner and last a little longer, they've missed, like, what the next trend will be. They took a half-hearted swing at the metaverse with Vision Pro. That didn't work out. and their AI story has obviously been bumpy.

5:53Big Technology Podcast Host:Any merit to that? I think merit to that, but you watch the markets. They, every couple years, sell more iPhones than they've sold in years past. This strategy worked. This was, whether we want to, I think there's always the question of who is Apple for or who are these Apple, what does Apple do? It's really who does their tech for, right, and their decisions for. Is it for the consumers who want to use this stuff? Or is it for Wall Street so we can always have another product and another product and another product? Look, I think you can find two people that say the same. You can find people that say both, right?

6:30Like they came out with some great products in the last number of years. Talk about the M chips. Like, again, Macs are the best laptops you can use. And, yes, it helped sell more laptops. It helped, you know, Apple make more money on that part of the business. Same goes for iPhones. Every year we get a new iPhone. Do we need a new iPhone every year? No, but for some people, they get a better phone and Wall Street gets another upgrade cycle. So you look at both of these things. And Cook, I think, fell in the middle somewhere, right? Like far more than Jobs was leaning probably towards ever thinking about Wall Street and thinking about the earnings and all of that.

7:11But also he's kept up with some really great products.

7:14Big Technology Podcast Host:Yeah, it's an in-the-market reaction, and we'll have to see. We'll publish this Tuesday. We're recording Monday just as the news breaks. The after-hours trading is pretty interesting. What is it? The stock dropped down, bounced right back up, and then back down again. So right now, as we talk, it's just down$2.25, so down less than a percent. Yeah, look, I think people were primed for this. I think I'm shocked at the timing. I thought they'd wait till after September. But given that we know there's so many products in the pipeline around September, I guess it's not super shocking. Look, Ternus has been doing media tours.

7:53He's been out there. Have you ever met him?

7:56Big Technology Podcast Host:I haven't. Have you met him? Yeah, yeah. Talk a little bit about this guy then. Look, he's very thoughtful. He clearly loves talking about hardware and talking about the products. you know whether it's the Nio or an iPhone he's he's very invested in in the details around the products but also I think has a marketing bent to him similar to you know all any any Apple executive who is clearly focused on just talking about what users with what the customer gets and how good it is but yeah I mean he's you know he's a little bit understated very just kind of cool guy I would say like it's a also a different face for Apple I think in in a really interesting way young young 51 years old yep or about 50 yeah 50 51 yeah no I think it's a very different face for Apple so he's going to be the be the leader for next bunch of years most likely the board likes him yes um it is interesting how uh it kind of leaked it's like the one oh that it was him that it was going to be him for a while and Apple tried to deny it.

9:07Big Technology Podcast Host:But the one thing that's been interesting under Cook recently is that Apple's been very leaky. I mean, it went from a company that never leaked to like a company where like you kind of knew what was coming all the time. I'm curious, do you think that signals like some internal like discontent around Cook or did it just become too old and big to contain the leaks and it became more of like a normal company? Well, it's still very – the secrecy of Apple and when you speak to certain employees, it's still very ingrained. It's very ingrained in some of them. As a reporter, I don't know if you've ever had this, but, like, sometimes I'll reach out.

9:44I'll reach out to Apple employees via LinkedIn, and immediately I get a phone call from Apple PR because employees really can take it extremely seriously. Like, they report me. They're, like, reporting me into Apple PR. It's like, okay, like, I'm just doing my job. I'm not getting in trouble with Apple PR. But look, I think a lot of the leaks have also come from the supply chain. I think the more they've diversified, that's part of where this is coming from. Some of it's marketing. Like you can tell that somebody clearly had some access to some version of, I don't know, whether it was some deck or some presentation that was coming.

10:21But I don't know. In this day and age, also, like, is it that bad, right? It builds hype for your products. People are excited. everyone's talking about this iPhone fold that's going to come out in September, right? Like, better that than there just be this complete surprise and people be like, eh, okay. Yep.

10:36Big Technology Podcast Host:Timing-wise, why did you think they were going to wait? Just to let WWDC go on without Tim Cook? It's kind of like a basketball player taking his, like, last season. But I guess he kind of just took it with this Apple 50th. Yep. It's kind of like the perfect time for him to step down because, like we said, Apple's a$4 trillion company. we don't know what AI is going to do to them. Right. So you don't want to be the guy who, like, it doesn't, I mean, this might be too critical on Apple, but it doesn't seem like they have answers on AI. And you kind of don't want to be the guy who just, like, presided over that.

11:12Big Technology Podcast Host:It's probably better to let somebody else take it. Yeah. But also I think if you look at Cook, he's getting old. Yeah. You know, not too old. Like, I think he clearly can still be a part of the company. 65. 65, and then this administration, like all the stuff he's dealt with. I think the guy was just like, eh, I'm done with this. He certainly has enough money. Yeah, yeah. What do you think, what do you look forward to under Turnus at Apple? Cooksworth, just according to a report I just pulled up,$3 billion. That's enough, I think. Yeah, I think he'll be fine. I think so, too. I do look forward to look I go to all Apple events.

12:00I look forward to some more energy in those events now. I mean I don't know if they'll bring him back on to the actual stage. But he's got presence. And if you want a leader to be on stage that's really interested in the hardware and getting really geeky and nerding out on certain stuff. That could be him. I think yeah I think the energy around the projects. Look I you know their pipeline. They've got stuff that they've already been working on. I don't think we're going to see sudden change, but we could come back here in three years and I think have a better sense of what he really did.

12:34Big Technology Podcast Host:Yeah. Fold? That should be a big product. Yeah, I think that's going to be a big product, but I think similar to a Vision Pro, it's going to be probably priced out of the mainstream and take a few iterations to get pretty good. All right, before we get out of here, what is Tim Cook's legacy?

12:55So I love that. I think the chips are a big thing that he did. I keep mentioning that. Because it's like when you think about the biggest thing, I mean, look.

13:08I don't know. There's so many things. There's like two main things that I think I come up with. One, building around the iPhone, taking that moat and just building so much around it. AirPods, Apple Watch, just extending that ecosystem to so many things. And then I think the operations and becoming a company that just could ship so many products at such good premium quality. And, you know, even look at what they just did with the NEO. I mean, like, you know, what they do on the operations side, I think. So I think those two things, like what he's done with the ecosystem. I mean, I think we could do a tally of how many times Tim Cook said hardware, software and services at events.

13:48It's probably it's certainly, you know, if you had a drink for each one, you'd be pretty drunk. Yeah, it's definitely older than him, more than his age. But like, you know, he made that a mantra and like that clearly moved markets and moved products for them. And then the operations side, what would you say?

14:04Big Technology Podcast Host:I mean, I would say he certainly gets credit for keeping Apple relevant by not chasing all the new things. Yep. But there's another side of that. He also will, I mean, if they don't figure out AI, and AI gets as big as a lot of people think it will be, then he will be seen as the person who was so myopically focused on what they did well that he failed to create a culture because we know the culture is not ready to build AI, failed to create a culture that could do this in-house. And I think that's evidenced by the fact that they have to partner with Gemini. There's a chance they're going to make this work perfectly where they didn't spend all this money building data centers and they license a model and it works in their product.

14:51Big Technology Podcast Host:But the other side of that story is also alive and he will have his hand off the controls as it plays out. Yeah, yeah. Yeah. No, it's been Tim Cook's Apple, you know, or Tim Apple. It's been Tim Apple. Now it's John Apple? Doesn't have the same ring as it. Ternus Apple. Apple Ternus over? Yeah. Oh, God. I'm going. Oh, that's a good headline. Joanna, thank you. I Am Not a Robot, It's a Book that you should definitely pick up. Got to get that in there. Can I just see my phone now? Yes. All right. All right, everybody. We'll see you next time. Thank you again for listening and watching. We'll see you then.

15:26Big Technology Podcast Host:Okay. Gracie Times.