 Apple's iPhone 15 Pro line. Photographer: Leon Neal/Getty Images Apple Inc. has achieved much of its success by regularly innovating the hardware and industrial design of its products. The company entices consumers to upgrade by giving its devices a fresh look, adding a more powerful camera or using snazzy new materials. But in recent years, Apple's pace of hardware innovation has slowed. Though the iPhone 15 Pro has a new titanium shell, the overall design isn't much different than the iPhone 12 from four years ago. This year's third-generation Apple Watch Ultra will have roughly the same look as the original, and the other watch models still resemble the Series 4 launched in 2018. The current MacBook Pro has the same basic form factor as it did in 2021, and I wouldn't expect a new look until 2025 or 2026. The MacBook Air was redesigned in 2022, and a future change is probably years away as well. The iPad Pro just got an impressive new design — with its ultrathin look — but that change took six years to arrive. The end result: Getting average consumers to regularly upgrade to a new model is harder than it used to be. Shoppers also are contending with inflation and worsening trade-in deals — or simply holding on to their cash in an uncertain economy. Moreover, Apple is now pushing to make its devices as durable as possible. It just put out a report on the longevity of its products, saying that new manufacturing technologies, software support and repair services are helping prolong their life. Devices from as far back as 2017 can still run Apple's current operating systems, the company said. That's not a bad thing, of course. The promise of longevity encourages people to invest in the company's devices and counters the critics who say Apple engages in planned obsolescence. But the broader trend has left Apple with a less reliable growth engine — something that's evident in its finances lately. Sales have declined in five of the past six quarters, and it's critical that the company finds new sources of revenue.  The Apple Intelligence announcement at its developers conference. Source: Apple The good news: Though Apple's hardware is doing less to inspire upgrades, it has a growing opportunity to entice customers with software and artificial intelligence. That should be evident this fall. The upcoming iPhone 16 lineup won't have a ton of hardware changes, but customers will need a recent model if they want to use the new Apple Intelligence features. New software enhancements also could coax Mac and iPad users to upgrade. Though Macs from seven years ago will still run the next version of the Mac operating system — macOS Sequoia — features like iPhone Mirroring and Game Mode require newer hardware. The Apple Intelligence capabilities, including an upgraded version of Siri, will be the biggest test of whether software can drive a hardware sales surge. The features are likely to be a centerpiece of Apple's marketing for the iPhone 16, just as ads for the original Siri helped drive sales of the iPhone 4S in 2011. Mac users, meanwhile, will need to have a model with Apple's homegrown silicon to take advantage of the new AI features. And the company's Mac revamp around the M4 chip over the next 12 months will likely focus on how well the new models run Apple Intelligence. The slowing pace of hardware upgrades also will force Apple to rely more on services fees and subscriptions to fuel sales. If you're wondering why Apple is fighting so hard to keep every penny it can from the App Store — despite scrutiny from regulators — it's because this category is so important to future revenue. There's an opportunity to turn AI features and other software into paid services, but it will take time. Though Apple Intelligence will be free to start, the long-term plan is to make money off the capabilities. The company could eventually launch something like "Apple Intelligence+" — with extra features that users pay monthly fees for, just like iCloud. On top of that, Apple will get a cut of the subscription revenue from every AI partner that it brings onboard. If it all comes together, Apple could find itself in a strong position in a few years. The company will be less reliant on hardware tweaks to drive its business and will actually be making money from AI — something everyone in Silicon Valley is hoping to pull off.  Watch Mark Gurman talk about the Vision Pro headset on Bloomberg Television. Apple Intelligence is coming to the Vision Pro. When Apple Intelligence was unveiled earlier this month, it was only promised for the Mac, iPhone and iPad. But there's another device primed to get it: the Vision Pro headset. I'm told that Apple is actively working on bringing the features to the device, but it won't happen this year. From a technology standpoint, the headset has more than enough memory (16 gigabytes) to run the technology. And the features, including notification prioritization, writing tools, an OpenAI chatbot and the new Siri, make sense for the headset — especially if Apple continues to position the Vision Pro as a device for getting work done and handling computer tasks. It also shouldn't be a major engineering task, given that visionOS is a variant of the existing iPadOS software. The bigger challenge will be getting the user interface design team to make it all look right in the mixed-reality environment. It also could tax Apple's still-expanding cloud-computing infrastructure. Fears of overburdening the servers are one reason the company has limited the AI features to more recent devices. But given that the Vision Pro hasn't sold in large quantities, that may not be a big concern.  A Vision Pro display at an Apple store in Shanghai. Photographer: Raul Ariano/Bloomberg Apple rejiggers Vision Pro retail demos in bid to spur sales. Five months after launching the Vision Pro, Apple is shaking up its in-store strategy for the device. It's a key moment for the product, which is just beginning to roll out internationally after a slow start in the US. The company hopes to refine the retail-store experience to help give the $3,499 device a boost. The biggest change is a new feature that lets customers beam their own photos, videos and panoramas over to a Vision Pro during a demonstration. Then they can see their own media in mixed reality. If you've already done this on a Vision Pro, you know that it could help sway some shoppers. The new approach is rolling out now, but the official launch is scheduled for July 9. Another change to the demo: Apple is adding a new "Go Deeper" option for people who want to spend more time trying out particular parts of the device, such as office-work features or watching videos. Lastly — and this went into effect Friday globally — Apple has changed the default headset band for the device during demos from the Solo Loop to the Dual Loop. It seems that the Solo Loop, which only wraps around the back of a person's head, hasn't been comfortable enough for potential customers.  Apple's Craig Federighi and Tim Cook at its annual WWDC event. Photographer: David Paul Morris/Bloomberg Luck, Cheer, Nepali and Discovery: Apple starts developing next year's device operating systems. The company has formally begun work on 2025's major operating systems: iOS 19 ("Luck"), macOS 16 ("Cheer"), watchOS 12 ("Nepali) and visionOS 3 ("Discovery"). Now, this may seem early. After all, this year's crop of software hasn't been released to the public yet. But this is the usual schedule: The company is already developing next year's hardware products and needs the accompanying software to start testing the devices. That said, it's far too early to tell what the actual features will be.  Meta Platforms CEO Mark Zuckerberg speaking at Meta Connect. Photographer: Bloomberg Don't expect Apple and Meta to partner on artificial intelligence. Last Sunday, the Wall Street Journal reported that Apple was in discussions to offer Meta Platforms Inc.'s Llama chatbot as an option alongside OpenAI. I immediately heard from several sources that this wasn't going to happen. The reality: The two companies had a brief conversation at Meta's behest back in March (after I reported on Apple's talks with OpenAI, Google and Anthropic). Apple has zero interest in embedding Meta's service. Those early conversations didn't evolve into formal discussions, and there's been no communication on the topic for several months. Apple is also giving no consideration to eventually adding Meta as an option, particularly because it believes OpenAI, Google and Anthropic offer superior services, I'm told. Such a move also would run counter to Apple's criticism of Meta for its privacy practices. As for an Apple deal with Google or Anthropic, I expect at least the former to be announced around the time Apple Intelligence launches this fall.  Apple Pay Later. Source: Apple A driving force behind Apple Pay Later's shutdown: regulation. Earlier this month, Apple announced plans to shut down Pay Later — its Affirm competitor — only about a year after the service debuted. There were several plausible reasons behind this move: People weren't paying their bills; Apple realized that being closely associated with such services was bad for its reputation; or the company was struggling to go international with the offering. But a big driving force I didn't mention last week is regulation. In May, the Consumer Financial Protection Bureau announced increased scrutiny of "buy now, pay later" services, saying providers would need to follow the same regulations as credit card companies. That includes the way they manage disputes, offer refunds and handle billing statements. The increased regulation wasn't something Apple wanted to deal with, I'm told, and the company is happy to hand off the service to third parties instead.  The Samsung Fold lineup. Photographer: SeongJoon Cho/Bloomberg July 10: Samsung to launch latest foldable phones, earbuds and smartwatches. As usual, Samsung will beat Apple to the punch in announcing devices for the second half of the year. This time around, the Korean tech giant will be hosting its Unpacked event in Paris, just weeks before the Olympics get going in that city. As for what to expect, the company should showcase new versions of its foldable phones, smartwatches and earbuds. The big thing to watch is how much AI becomes part of the conversation now that Apple has gone all-in on the concept. Don't forget, Samsung already rolled out AI devices earlier this year featuring Google's Gemini technology.  Google Pixel 8 and Pixel 8 Pro smartphones. Photographer: Ed Jones/Getty Images Aug. 13: Google to hold an earlier-than-usual launch for new Pixel devices. The Alphabet Inc. company is slated to reveal its annual device upgrades during the heart of the summer, far earlier than its usual October timing. The two likeliest reasons: The company wants to stay well clear of Apple's launch in September, or it aims to give less time for details of the new products to leak out. The event should feature the Pixel 9 phone, new Pixel Buds, a larger version of the Pixel Watch and potentially an update to the Pixel Fold. Q: Would Apple consider pulling out of the European Union to avoid the regulations?
Q: Will the HomePod get Apple Intelligence?
Q: Will Apple Intelligence get regular improvements on an annual basis? | 
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