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Welcome back to the Joseph 
Carlson show on this episode. 

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Apple is working on a hardware 
subscription service for 

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iPhones. 
This might seem like just a blip

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in the news. 
It came and went in a day but I 

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think this is a much bigger 
deal. 

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I think this is a substantial 
key part of apples. 

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Overall master plan, I'm going 
to explain their master plan. 

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In this episode, we also have 
news apples, not going to be 

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charging their fees for video 
and music apps. 

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So users can come in and sign up
through a All without paying 

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their tax, the Apple App Store 
tax and I'll explain why this is

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a good move for apple as a 
shareholder. 

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This is the exact type of move. 
I like to see Meta. 

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On the other hand right now is 
having a difficult time 

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retaining top talent. 
This is a story that I've been 

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hearing over and over again for 
the past month, meta is losing a

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lot of their top talent to 
competitors and we're going to 

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dive in and try to explain why. 
And then, we also finally have 

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some positive economic news. 
People are going back to work at

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a very brisk Pace. 
I'll show you Quick people are 

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going back to work in this 
episode and then of course, we 

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have my portfolio. 
There's no major changes to it. 

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Other than the fact that I sold 
a little bit of my core, I sold 

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a little SCH G and a little s CH
D to buy more dominoes that is 

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around 6% of my portfolio. 
So it is a substantial by but 

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it's not. 
Like I'm going all in on this 

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company. 
I do think the company's 

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attractively valued and although
I can't predict short-term moves

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in the market. 
I think the Domino's has a very 

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bright future. 
You want more information on 

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this trade, in this company, you
can refer to my previous video. 

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Now let's go ahead and jump 
right in there is some news 

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about a week ago that just 
popped up for about a day and 

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then it quickly faded away into 
the background and the News was 

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that apple is working on a 
hardware subscription service 

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for iPhones. 
That's the headline. 

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Now, most people that read this 
might shrug their shoulders and 

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think, okay, another 
subscription service, right? 

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I've heard this before, but I 
think this is much bigger news 

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for Apple than people are giving
it. 

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For especially investors in 
apple. 

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This is incredibly important 
news. 

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Let's back up here for a minute.
First of all, you know that, I'm

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a big fan of subscription 
Services, I've made a number of 

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videos on the subjects. 
Now, of course, we have Netflix,

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Netflix, almost invented the 
model. 

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They actually turn the entire TV
industry upside down in the 

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cable industry upside down with 
their direct-to-consumer 

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subscription model. 
It's much more consumer 

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friendly. 
You can look at Costco. 

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Costco is a Warehouse that 
provides so much value that 

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people pay a subscription in 
order to shop there, they're 

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paying Costco money, just to get
into the store before they can 

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start buying things. 
That's the amount of value that 

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company offers but the big part 
of their business model is the 

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yearly subscription with the low
churn rate. 

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Then we can look at Amazon, 
Amazon is almost like the sped 

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up version of Costco brought 
online and it likewise turn the 

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online retail industry upside 
down with its Amazon Prime 

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subscription. 
Action model offering two day 

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shipping to Prime members, 
Amazon gains, billions of 

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dollars in pure operating income
on a reliable basis, every 

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single year with their 
subscription model. 

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Now, of course, when you think 
of Amazon and subscriptions your

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mind goes to Amazon Prime, 
that's the subscription they 

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sell. 
You can also look at another big

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aspect of their business which 
is AWS Amazon web services, 

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although AWS isn't exactly a 
subscription model. 

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It's extremely similar AWS runs 
off of a model where they're 

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selling. 
Are big infrastructure. 

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All of the buildings that 
they've built that host. 

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All of the web they're selling 
that infrastructure as a service

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that's literally what the 
business model is its 

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infrastructure as a service, and
similar to subscriptions, they 

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are tied into their customers. 
They already have their credit 

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card numbers. 
They already have their payment 

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information and they just build 
them reoccurring every single 

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month or every single year based
entirely off of their usage. 

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So Amazon has dual levels of 
subscription. 

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They The Amazon Prime 
subscription and then they have 

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the infrastructure as a service 
through AWS. 

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This is an evolution in the 
subscription model aimed at the 

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corporate world. 
Now, the thing that's important 

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to understand from the 
investment perspective is that 

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service-based and subscription 
based companies. 

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Almost always earn a higher 
multiple from investors than 

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simply one time sales companies.
The multiple I'm talking about 

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is the price to earnings or the 
price to sales. 

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Microsoft for example, has a 33 
PE on a trailing basis A 29 

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forward P/E. 
That's a pretty high multiple. 

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But Microsoft has always been 
looked at as an incredibly wide 

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mode subscription based company.
So always has that premium, that

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people pay over other companies 
that simply don't have this type

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of sticky reoccurring Revenue. 
Now, if we compare Microsoft's 

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Revenue to Apples, Apples is 
always been a little bit more 

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jarring, a little bit more back 
and forth, never quite as 

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consistent as Microsoft's 
because Apple has been largely 

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based off of one time sales of 
lots of different Biases, the 

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iPad and MacBook, and mostly the
iPhone sales. 

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Not as much of their revenue has
been based off of that 

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reoccurring Revenue. 
But Apple has been working 

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almost desperately to change 
this. 

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We look at the company overall 
and we cut out the different 

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forms of Revenue, aside from 
just Services. 

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The services have grown 
substantially on a 

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year-over-year basis. 
It's growing like a startup 

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company. 
This is the quarterly growth of 

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just their services. 
The most recent quarter, the 

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services were 51 billion 
dollars. 

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But I look at Microsoft and 
Apple and I know that these two 

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companies envy each other in 
different aspects, Microsoft 

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envies apples position as having
so much Hardware with a direct 

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connection to the consumer. 
They wish that they had more 

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Hardware in consumers hands. 
I know, that's something 

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Microsoft wishes they had, the 
Apple currently has, and 

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likewise I know that apple looks
at Microsoft as a company and 

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envies, the fact that they have 
so much reoccurring subscription

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Revenue, that's something that 
Apple wishes they had. 

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So each of these companies are 
trying to become more like each 

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other in two different ways. 
But with this blip of news, a 

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headline, that was last week and
quickly faded away it revealed 

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apples. 
Big step into becoming like 

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Microsoft. 
Apple is working on a brand new 

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type of subscription. 
It's not SAS, it's not software 

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as a service. 
It's not infrastructure as a 

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service like AWS are Azure. 
This is hardware as a service. 

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This is the big push that 
Apple's going to make. 

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They're going to turn their 
Hardware into a Service just 

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like Netflix. 
Now let's go ahead and listen to

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this news report from the person
that broke it to try to break 

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down. 
Really? 

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What this is yeah thank you for 
having me. 

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This would be no different like 
you said than your monthly 

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ten-dollar Apple music 
subscription or $15 a month, 

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Apple One bundle subscription 
right? 

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You'd be paying for the phone on
a monthly basis. 

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Like you might on a car, at 
least. 

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Now this is different than 
installment programs and carrier

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subsidy programs today. 
What apple and the carrier's 

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allow you to do? 
If you don't want to buy, the 

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phone outright is split up the 
cost. 

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Whether that's Five hundred 
dollars, fourteen, hundred 

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dollars, or less for an sc and 
such over 12, 18, 24, 30 months,

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depending on your carrier. 
This would be a set fee. 

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That's not the cost of the phone
/. 

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You know how many months they're
already here two years? 

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So this is not simply taking the
foam price and breaking it up 

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into monthly payments. 
It shouldn't be viewed that way,

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because it's not doing the same 
thing. 

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You actually don't own the phone
and the same way is if you just 

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broke up, the payments Apple 
wants to make it so that their 

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Hardware R is you too much more 
like apple music or Spotify or 

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Netflix? 
It's just in a different medium,

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you get a phone sent to you, you
pay a monthly price every single

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month and then you get the 
newest phone sent to you and so 

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on and so forth. 
You're paying a subscription 

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price for an ongoing service, 
only in the form of Hardware. 

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So they say that the service 
would be apples. 

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Biggest push yet into automatic 
reoccurring sales, allowing 

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users to subscribe to hardware 
for the first time rather than 

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just Digital Services but the It
is still in development. 

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So this is all inside rumored 
information, but I have a very 

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strong belief that these rumors 
are true. 

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And apple will eventually 
introduced this type of Hardware

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as a service. 
Now, I know what you're thinking

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and I'm thinking the same thing.
This is awfully reminiscent of 

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that whole, you'll own nothing 
and be happy quote from Black 

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Rock, the whole idea of you 
actually owning nothing. 

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That's what companies seem to 
want, right? 

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Well, I actually think about 
this, I don't think it's quite 

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as Sinister. 
Apple is a company that sells 

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consumer electronics and at 
least for The iPhone. 

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They have a very short shelf, 
life of how long they're on the 

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bleeding edge. 
Technology, moves incredibly 

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fast. 
IPhones only stay really good 

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for three or four years until 
you probably want to upgrade to 

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the latest one. 
So most of us, even though we 

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own our iPhone, they are rapidly
depreciating assets. 

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They lose their value, 
incredibly fast. 

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After a couple years, they're 
only worth half or quarter as 

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much. 
And many people even though they

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quote unquote own their iPhone 
are constantly just junking 

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their old iPhone buying. 
One, junking their old one, 

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buying a new one. 
So for that huge swath of 

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people, this would actually come
in as an easy way. 

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They just subscribe to the 
newest one and be insured. 

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You're always going to have the 
latest and greatest for very 

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frugal people for investors and 
most of you watching this show, 

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you're probably in the category 
where this doesn't look like 

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such a great deal, but you got 
to look at this through the lens

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of the average. 
Apple consumer, millions of 

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people just want to have the 
latest technology. 

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They spend all of their time on 
these devices and having an easy

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way to do that. 
At with less friction is a 

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win-win for both the consumer. 
And for Apple, it will make it 

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so that they finally have the 
huge reoccurring revenue of a 

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Microsoft like company and for 
the consumer. 

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It creates less friction to 
constantly upgrading their 

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device. 
In my opinion, I think there's a

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very good chance to Apple will 
push into Hardware as a service.

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And I also think there's a very 
good chance, they'll be widely 

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successful at it. 
It will build a more reoccurring

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Revenue stream to give Apple 
more consistent, Microsoft like 

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revenue. 
And interestingly, Apple's PE 

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ratio their multiples have 
climbed to almost perfectly 

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match. 
Microsoft's apples forward, P/E 

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is out of 29 and Microsoft is 
out of 29. 

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And in my opinion, this makes 
sense. 

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I think that Apple should trade 
around the same as Microsoft. 

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So, that is Apple's master plan 
and I think they have a decent 

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chance of pulling this off. 
Not a quick side note, Apple 

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also said that they're now going
to allow video music apps to 

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sign up new subscribers without 
paying fees. 

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So basically with apps like 
Netflix and Spotify, you might 

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00:10:28,600 --> 00:10:31,400
be able to sign up through the 
The app if Netflix and Spotify 

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want you to and you won't have 
to pay Apple any type of fees, I

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think the reason that Apple's 
doing this is smart, they 

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realize that these big companies
like Netflix and Spotify are 

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simply circumventing it. 
Anyway, they're not signing up 

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through apple and that creates 
less lock in with their 

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ecosystem. 
So, they're saying, you know, if

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more and more apps do this and 
circumvent the App Store, we may

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as well lower the fees and have 
them sign up through the app 

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store because in those customers
have a close connection with 

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00:10:58,800 --> 00:11:00,600
Apple. 
So, You know, this will hit the 

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top line revenue for Apple 
little bit. 

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I think that overall this is a 
very positive thing. 

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It looks good to Consumers, it 
looks like apples doing a right 

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step and lowering fees, and it 
also creates more lock in on the

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Apple App Store because more and
more people are going to be 

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signing up through the App 
Store. 

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Now, moving on, we have 
struggles that a lot of tech 

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companies have faced recently, 
especially the big ones of an 

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exodus of talent. 
And it seems like a lot of them 

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are leaving for start-up 
companies or new Ventures where 

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they're going for lots of Equity
and meta is facing a lot of this

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issue. 
I think in part because of the 

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stock price plummeting, but also
because of the rapid shift and 

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direction for the company, they 
say that the top talent is 

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quitting as the lab tries to 
keep Pace with Rivals at least 

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four prominent members of meta a
a I have departed in recent 

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months according to people 
familiar with the matter and 

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Linkedin analysis, Karl Herman, 
an AI entrepreneur who used to 

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work at the Rival. 
Lab deepmind told CNBC on 

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Monday. 
The true figure could be More 

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like half a dozen. 
Adding that the company's 

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London, AI lab had seen an 
alarming number of exit, quote 

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metas, London office, just 
collapsed, and they lost most of

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their top researchers in the 
span of six weeks. 

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That sounds pretty Grim, the 
whole office collapsing in it. 

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They asked people the reason why
they think they're leaving and 

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it seems like just a variety of 
different reasons. 

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Quote, some people jump to 
another big lab because I fill 

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it will advance their career or 
research agenda. 

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Better, that is a frequent 
reason that Engineers leave 

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company. 
He's for career advancement. 

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You don't want to get too 
complacent with where you're 

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working. 
Another one is quote, others go 

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because comps or hiring 
potential for their team is 

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better elsewhere, The Source 
added quote, others just want to

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do startups or get involved with
smaller companies for some it 

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might be tied to meta stock 
tanking, but I wouldn't say 

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that's necessarily the main 
reason. 

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So seems like there's a lot of 
different reasons and I've heard

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this same thing Through the 
Grapevine. 

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I've heard a lot of people are 
leaving, not only meta but other

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big Companies to pursue 
different Endeavors. 

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And this is a risk for big Tech,
Talent is their most important 

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asset and they have to find a 
way to retain them apples. 

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Chosen way of retaining. 
Them seems to be throwing two 

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hundred thousand dollar stock 
bonuses per year at their key 

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Engineers. 
That is the way that I think 

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apples trying to handle this is 
by simply paying them, an 

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absolute fortune on top of their
salary. 

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But unless you're willing to 
dish out this much money, seems 

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like a lot of these Engineers 
are going to be leaving to other

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opportunities. 
So it's difficult to know how 

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Much, this type of news will 
affect the investment overall of

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meta or other big tech companies
in my opinion, I wouldn't Factor

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00:13:36,800 --> 00:13:40,300
this type of negative news too 
much into an investment thesis 

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00:13:40,300 --> 00:13:42,500
of meta. 
I don't think that a couple 

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engineers at the company are 
going to make or break their 

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effort. 
I think that overall if your 

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entire thesis is reliant on 12 
or 15 Engineers, that's probably

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a bigger concern with a company 
like meta, they have tens of 

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thousands of employees and they 
should be able to work past 

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00:13:58,100 --> 00:14:00,400
this. 
Now, moving on, we have Actual 

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00:14:00,400 --> 00:14:03,600
positive news about the economy.
This is something that we don't 

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00:14:03,600 --> 00:14:07,500
hear all that often. 
The March jobs report is out and

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00:14:07,500 --> 00:14:10,400
it shows extremely strong hiring
momentum. 

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00:14:10,700 --> 00:14:12,800
This is more than just a Brisk 
Pace. 

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I think that they're actually 
understating how rapid this job 

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00:14:15,800 --> 00:14:17,600
growth has been. 
Because look at this, they see, 

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employers added 431,000, jobs in
March, another 400,000 plus jobs

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in March and employment in 
January, and February combined 

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00:14:26,700 --> 00:14:29,600
was 95,000 higher than 
previously reported. 

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00:14:29,700 --> 00:14:32,600
And the report marked the 
eleventh straight month of job 

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00:14:32,600 --> 00:14:35,700
gains above 400 Thousand, Eleven
months in a row. 

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00:14:35,900 --> 00:14:39,200
That's the longest stretch of 
growth in records dating back to

300
00:14:39,200 --> 00:14:41,800
1939. 
The unemployment rate fell to 

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00:14:41,800 --> 00:14:45,900
3.6 percent that is quickly 
approaching the February 20, 23 

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00:14:46,500 --> 00:14:49,900
pandemic rate of 3.5% a 50-year 
low. 

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00:14:50,300 --> 00:14:54,000
Now the employer participation 
rate hasn't fully recovered but 

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00:14:54,000 --> 00:14:56,000
that's recovering very rapidly 
as well. 

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00:14:56,300 --> 00:14:59,600
So, everything in terms of 
employment is moving rapidly. 

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Back to normalize levels back 
into a good direction. 

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And again, I think this is 
happening incredibly fast. 

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Look at this graphic here is an 
example. 

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This shows basically every time 
there's been huge job loss in 

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00:15:12,200 --> 00:15:15,600
the u.s. history and it shows it
with different colored lines. 

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00:15:15,900 --> 00:15:19,700
2020 was the red line. 
So you can see that this was 

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00:15:19,800 --> 00:15:23,500
essentially the worst job loss 
we've ever had by far the 

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00:15:23,500 --> 00:15:27,500
highest levels of unemployment 
at an incredibly Fast Pace, but 

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00:15:27,500 --> 00:15:29,000
look how fast the recovery's 
been. 

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00:15:29,700 --> 00:15:33,600
That against 2007. 
In 2007, it took years and years

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00:15:33,600 --> 00:15:37,200
and years to get back to the 
amount of jobs that we had prior

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00:15:37,200 --> 00:15:39,600
to the recession. 
And you can see the trend in 

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00:15:39,600 --> 00:15:42,500
2020. 
What used to take years is now 

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00:15:42,500 --> 00:15:45,400
taking months and it looks like 
in just a couple months. 

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00:15:45,400 --> 00:15:48,300
We might be back to where we 
were pre-pandemic level. 

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00:15:48,500 --> 00:15:49,900
I think that's pretty 
incredible. 

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00:15:50,000 --> 00:15:52,600
So I'm not trying to paint a 
Rosy picture about the economy. 

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00:15:52,600 --> 00:15:54,800
There's certainly a ton of 
challenges we're facing with 

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00:15:54,800 --> 00:15:57,700
inflation and Rising interest 
rates, but the jobs gains have 

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00:15:57,700 --> 00:16:01,400
been a bright spot looking at 
the Employment rate illustrates 

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00:16:01,400 --> 00:16:04,600
this in a different way. 
You can see the massive spike in

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00:16:04,600 --> 00:16:07,300
2020, as many people are 
prevented from working. 

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00:16:07,700 --> 00:16:10,600
And all of that quickly 
returning, we're almost back 

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00:16:10,600 --> 00:16:13,700
down to the exact unemployment 
rate that we were prior to the 

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00:16:13,700 --> 00:16:15,600
pandemic. 
In my opinion, I think it's a 

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00:16:15,608 --> 00:16:18,100
very positive thing that people 
are going back to work. 

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00:16:18,200 --> 00:16:20,400
So that's all for now. 
If you want to get an updated 

333
00:16:20,400 --> 00:16:23,200
link of my portfolio, there's 
one in the description of this 

334
00:16:23,200 --> 00:16:26,500
video and also, if you want to 
try out the patreon, you can try

335
00:16:26,500 --> 00:16:29,500
it out today with a free trial 
for this month, and you'll be 

336
00:16:29,500 --> 00:16:31,500
able To see if you like it and 
you want to stick around. 

337
00:16:31,500 --> 00:16:33,800
There's also a link in the 
description for that other than 

338
00:16:33,800 --> 00:16:35,400
that, I'll see you in the next 
episode.