Product Launch

Oct 16, 2014

Good morning. Good morning. Thanks to everyone for joining us this morning. It's been an incredible year and tremendously busy already, but we've got a few more things to share with you before we close out the year. As you saw from the video, we had an amazing reception to the iPhone 6 and iPhone 6 Plus launch. The stores were absolutely electrifying with energy. It was unbelievable. There was no better place on earth to be. These phones are the best phones we have ever created and the reviews have been off the charts. It doesn't get any clearer or any better than this review from one of the industry's preeminent reviewers. Walt Mossberg said simply, it's the best smartphone on the market. You can't hope for better than that. Now with great reviews and a great customer response, it's no wonder that these iPhones have become the fastest selling iPhones in history. And the 1st 30 days, we have set a new high water mark for the most orders taken. And I don't mean by a little, by a lot, a whole lot. Our rollout around the world is going well. In fact, by the end of this week, we'll be in 32 countries. And just in a few hours from now, we will launch in China. With support for TD LTE and FDD LTE, iPhone 6 and 6 Plus customers will have access to China's fastest networks on all three major networks. This is the very first time we've launched a new iPhone on all three networks and we're doing it perfectly aligned to the early stages of China's huge 4 gs rollout. We couldn't be more excited about this. And I would tell you that the preorders, as you might guess, have set a new record. We can't wait to get started. With what's going on in China, what's going on here and the other countries around the world and all of the reviews and the customer response, this is our biggest iPhone launch camera. So that's a quick update on iPhone. Now the iPhones also get the benefit of another major announcement that we made last month. And of course, I'm talking about Apple Pay, which is an entirely new way to pay for things in stores and in apps. Apple Pay is built right into Passbook, integrated right in and everything you need is built into iPhone 6 and 6 Plus. It's an easy, it's secure, and yes, it's a private way to pay for things. We think that it is going to be profound. We're getting going in the United States. We've got all 3 major networks supporting us and we have all of the nation's top banks supporting us. And just since last month announcing this, we have signed another 500 banks. They will be rolling out support later this year early next year, showing the support and the enthusiasm around Apple Pay. We've got many of the largest retailers in the country supporting us. And as you might guess, since we announced last month, there's even more that we'll be rolling out between now and the end of the year. Now Apple Pay also works online in apps. You can buy products and services right in the app. And it's pretty simple. Find those pair of Beats headphones you want and boom, you bought them. I've been wanting these a long time and Jimmy won't give me a pair. We've got a lot of people behind us here as well, a lot of great apps and a lot of great developers. And as you might guess, since last month, many more people have committed to rollout between now and the end of the year. So we believe Apple Pay is going to be huge. It's going to change the way we pay for things. And I'm excited to announce today that we are beginning on Monday. The journey begins and we can't wait. Now also last month, we announced an entirely new category. Of course, I'm talking about Apple Watch. It's the most personal device we've ever created. You can wear this powerful technology right on your wrist and it's just as much about personal expression as it is about functionality. We've had great reception from the tech community, but we've also had great reception from the health and fitness community and by people who know a lot about fashion and style, even more than I do. In fact, this month, the Apple Watch is on the cover of Vogue China. We are really proud of this. It's an incredible image and we're so proud to be associated with BOGO in China. Now as we showed you last month, we have been working with selected third party developers on Apple Watch and like BMW, like American Airlines, like Starwood and they've created some really unique personal experiences for Apple Watch. I'm pleased to tell you today that we have developed WatchKit, where many other developers can join this party, and we are rolling out WatchKit next month in time for our developers to really do some fantastic work before we begin shipping Apple Watch. We can't wait to see what amazing experiences they'll come up with. Now Apple Watch will be shipping in early next year and every day I look forward to that day. So that's some quick updates around iPhone 6, iPhone 6 Plus, Apple Pay and Apple Watch. They join an incredible product lineup, one that I would call our strongest product lineup ever. Each of these products are not only individually the best in class within its category, but they've been designed to work seamlessly together. And this is made possible by the most advanced operating systems on the planet, iOS 8 and OS 10 Yosemite. Today, we've got some terrific updates on both of these and to tell you all about them. I'd like to turn the stage over to Craig Federighi. Craig? Good morning. Well, iOS 8 has been out for just under a month and I'd like to give you a quick update. Now iOS 8, of course, is a major new operating system for iPhone, iPad and iPad Touch and the early reviews have been just great. The Wall Street Journal said that iOS 8 pulls out ahead of the competition by leveraging the greatest strengths of the iPhone, its app and its ecosystem. But what's even cooler is just how many of our customers are already using it. You can see that in just under 4 weeks, nearly half of iOS customers are running iOS 8. Now if you consider that in combination with iOS 7, that means that 94% of iOS users are running an operating system that shipped in just over the last year, which means they're getting the latest features and all the latest security protections. Now the situation with other mobile platforms is somewhat different. So when you look at Android for instance, the vast majority of customers are running an operating system that's more than 2 years old. And if you focus just on KitKat, the latest release, after 313 days, they achieved just 25% penetration of our user base. IOS 8 has nearly doubled that in just 26 days. We couldn't be happier. Now iOS 8 is a major feature release with something for all of our customers. Things like tap to talk and easy location sharing in messages, Our new quick type keyboard with smart predictive typing suggestions and family sharing that makes it easy to share your calendars, your to dos, your photos and even your purchases on the App Store and the iTunes Store. But what really sets iOS 8 apart is all the incredible technologies that it puts in the hands of our developers. It's amazing what they've done with them. Let's take a look. We'll start with extensions. We've seen an absolute flood of updates to the App Store with applications improving their functionality via extensions. So now with iOS 8, when you swipe down from the top of your phone to get into your Today view, you have access not just to the systems built in widgets, but also these great 3rd party widgets as well. And when it comes to sharing, you of course have all of the system sharing options, but also those of the 3rd party apps you use the most. And so with just a single tap for instance from almost anywhere in the system, you can post to Evernote. Now we've also added support for 3rd party actions, the ability to edit your photos using 3rd party filters without even leaving the Photos app and access to your documents, not just in Icloud, but also in Box and Dropbox and just about any other box where you happen to put some files. Now, we also have support for 3rd party keyboards. So, whether you like to type by swiping your finger all over the screen or enrich the life of your friends with sending them animated GIFs or communicate in your native language of Klingon, iOS 8 has you covered. Believe it or not, this is actually in the App So, go fling on. So, next up Health Kid. Developers really embraced HealthKit. So when you're taking a run or cycling with Strava, all of the data about your workout, activity data goes into your health profile and health kit. With apps like Lifesum, they're able to combine activity information with information about your eating habits to make custom diet recommendations. And then you have apps like Sharecare's AskMD, which are able to take your profile including things like data from your Bluetooth scale or other sensors to offer personalized health consultation. And we've also given developers access to Touch ID, which means now if you want to get into E*TRADE or unlock your passwords in 1Password, you can do it with the security and the convenience of your fingerprint. And then there's metal. With metal, you get direct access to the power of the 64 bit A7, A8 and the amazing GPUs they have inside. And so whether you're racing around the track in Asphalt 8, creeping around the rooftops in Assassin's Creed Identity or slashing your way through gods of Rome, you can do so with unparalleled visual fidelity, things you've never seen on mobile platforms. Next is Swift, an entirely new programming language that we introduced to take development of iOS and OS X apps to the next level. Now Wired has said that Swift's impact could be greater than any other language that has sprung up in recent years and it may achieve mass adoption faster than any language in modern history. And from everything we can see, they are right. We've seen a flood of applications written in Swift in the App Store already. And our enterprise partner IBM has completely embraced Swift for their custom enterprise applications. In fact, they've said that Swift is incredibly interactive and intuitive, giving the thousands of developers on our teams the flexibility to create powerful apps that will transform enterprise mobility. There'll be many new Swift programmers being minted every day because major universities have incorporated Swift into their programming curriculum to teach new students this awesome new language. That's a quick update on iOS 8. Now let's turn our attention to iOS 8.1. Now needless to say, when we put a major new operating system in the hands of 100 of millions of users, we do get a little bit of feedback and that takes us to improvements. So, one of our major goals, of course, with iOS 8.1 is to address the top sources of customer feedback and of course to even bring back the beloved camera roll. But not just that, we've added support in 8.1 for Apple Pay on iPhone 6 and 6 Plus and the public beta of Icloud photo library. So now everyone can have every photo you take on all of your devices. And this means that any organization you do or any edits you make on any device are instantly reflected on all of your devices. This is true on your iPhone, your iPad and you can even access your photo library on your Mac or on your PC via icloud.com. Now this isn't just your photos, it's also your videos as well and they're in their original format and resolution, no downscaling. It's available in public beta with iOS 8.1 and it uses your iCloud storage. So your first 5 gigabytes are free. For just $0.99 you can get 20 gigabytes more and you can get a massive 200 gigabytes for just $3.99 So that's iOS 8.1 and a quick update on iOS 8. Now let's turn to OS 10 and Yosemite. So it was just this June that we publicly unveiled Yosemite to the world. The reception has been fantastic. We've had over a 1000000 members of the Mac community sign up to be part of the Yosemite public beta and the reception has been just awesome. We're all in love with the gorgeous new design of Yosemite. It's just amazing. Has this gorgeous dock with these vibrant icons, so precise, this clean and consistent use of typography throughout the system. Notification Center is more useful than ever, lets you get at all of your widgets just at a glance including 3rd party content and Spotlight has been absolutely supercharged. So now in addition to searching content locally on your Mac, it also taps into sources on the Internet, things like maps and Wikipedia, just right there whenever you need them. And of course, all of the apps built into Yosemite have been completely revitalized with this new UI. So Safari, for instance, all the power of the world's most powerful browser are packed right into that elegant toolbar right there at the top. If you want to get at all of your favorites, just tap in the address field, they're right there. And if you start typing, you don't just get Google search suggestions, you also get spotlight suggestions, which often provide the answer to your question without even completing the search. It's just really fast. Now Safari is better at sharing than ever as well. You can share to system sources and through extensions to 3rd party sources as well right within the app. Safari users also of course love tabs. And so we have a great new tab view, provides a bird's eye view of all of your tabs, stacks multiple pages from the sites into stacks like this and you get access to tabs you have open across all your devices listed right there along the bottom. But of course, Safari is also blazing fast. In fact, when you look at the kind of JavaScript that's in typical websites, Safari is literally 6 times faster than other browsers. And when it comes to battery life, no browser can compare to Safari. If you look at our 13 inches MacBook Air for instance, browsing in Safari gets you more than 2 hours greater battery life than other major browsers. And with Netflix streaming, 3 hours longer. Safari is just incredibly efficient. Now, our Yosemite design extends of course to mail as well. It's not just gorgeous, but it's more functional than ever. Now, if you're replying to a message and you need to fill out a form, you can use markup. You can even fill out your signature on a form right there inside the message. It's incredibly convenient. And you can also mark up your drawings as well, your pictures as well, which is a fantastic way to communicate. Now Mail also now has Mail Drop, so you can send absolutely enormous attachments up to 5 gigabytes securely encrypted through Icloud. Messages has a beautiful new design excuse me for Yosemite as well and it has powerful features like named group chats, easy location sharing and really convenient access to all the photos that you share in your conversations. ITunes has been updated for Yosemite as well. It has a convenient new shelf across the top with all of your recent additions to your library. And then there's iWork. It's the most popular desktop productivity suite across all Apple devices and it's got a great update for Yosemite. In addition to this beautiful new design, it's more functional than ever with a sidebar that summarizes all the comments on documents that you have under review. We have an update to numbers, lots of power user features like the ability to transpose tables in a single step. And then there's Keynote with a customizable presenter display and these cool new text effects. It's really nice. So next, there's Icloud Drive. So with Icloud Drive, you can store any file in the cloud. It's accessible right from the finder, right from the sidebar there and you get access to the application folders of all of the applications on your Mac, but not just that, also the data that you have stored for applications on your iOS devices. And best yet, you can put any other files you want in there and organize them however you want in folders with tags and search them and then access them across all of your devices, your iOS devices, your Mac, and if you're having to work under extreme duress, even a Windows PC. So now so those are just some of the wonderful new user features in Yosemite. But actually what makes both Yosemite and iOS 8 so special is the way that they work together. Now working together is something we've been focused on for years now and at the center of it is Icloud. It's almost easy to take for granted the way we can edit our contacts or update our calendar to dos or Safari bookmarks and we just know that it's going to be available to us across all of our devices. And now with Yosemite and iOS 8, all of our documents with Icloud Drive and all of our photos and videos are synced with our Icloud photo library. We've also advanced on technologies for our devices to communicate in proximity, taking advantage of the most advanced Wi Fi and Bluetooth low energy technologies. So now with the latest Macs and iOS devices, you can actually air drop between iOS and OS10 and you can airplay to your Apple TV even without connecting to any Wi Fi network. It's really awesome. But the area where I think we've really taken it over the top, so something we call continuity. Now with continuity, your devices are aware of each other and allow you to work at any moment with a device that's right for that time. It starts with handoff, where you can work on one device and just pick up where you left off with just a swipe across the lock screen of another. And there's instant hotspot, so you can take advantage of the cellular data connection of your phone from your iPad or your Mac without even touching the phone in your bag. There's the ability to receive text messages on any device, so not just your iMessages, but also you can send and receive SMSs from any of your devices. And finally, you can also make and receive regular telephone calls using your Mac as a speakerphone using your phone. It's really magical. And to drive that home, I'd like to give you a demo now. All right. Well, so let's take a look at life in the world of continuity. Now, Tim sent me a note here about doubling down on secrecy at Apple. We want to preserve the same kind of airtight security or secrecy rather that makes the announcements at an event like today a shocking revelation to all of you. So, I've been tasked to create a new employee orientation presentation. And so I've been taking some photos around campus about some of our new secrecy measures. We're tightening things down a little bit. So we see we're redacting some things in the menu. We don't want any leaks there. We've upgraded the door to Johnny's lab. And I should favorite some of these photos because I think I'd like to incorporate them in my presentation. We're saving a step with a printer. It just goes straight into the shredder. And of course, we've increased the number of lasers on the path to the bathroom. So that's good. So I can incorporate this right here in my presentation. We've got my cover slide here. And this looks like a good place to add that new content. But I actually have my iPad right here. And what's really great is with continuity, I can just pick up where I left off. It's in the lower left hand corner of the screen. My iPad is aware of what I've been doing on my phone. There's a little Keynote icon. I can just swipe up and it takes me right to that document in exactly the place where I was working. So it was right where I am. I'm just going to open this up and we'll see that I can see my photos here. Let me try that again. There we go. There are the photos I just favored. And just to show you that this is all completely live, I'm going to go back into my photo library here. I'm going to favorite this last photo with the lasers, give it a little heart. And you'll notice here and on the iPad, it just shows up automatically right there. That's super cool. So let's just add that photo to my presentation. And while I'm working on my iPad, my phone could even be across the house. And if I were to receive an SMS, for instance, I could pick it up. Oh, here it is. What a coincidence. Right here on my iPad, this is a regular SMS. Now it says, hey Craig, check out the latest Apple rumor. Well, these are usually have no merit at all, but I'll just check-in is what this is all about. Apple spaceship, actual spaceship. Okay. Well, it turns out in this case, unfortunately, they did nail it. So this would be a good one to add as a cautionary tale to my presentation. Now I could do that right here on my iPad, but I've got this beautiful Mac right here. Let me just pick up where I left off on the Mac. So, we'll just look at the Mac display and you notice the Mac is aware of what I've been doing. You see right down here says that I was using Safari in my iPad. I click and it takes me right to that same page. It's just magical. And of course, I can get to my presentation as well. We see I have iCloud Drive right here in the finder and there's my Keynote folder. And of course, there's my presentation on secrecy at Apple. So I can open that up. And of course, it takes me exactly to where I was in the presentation. So let's add my picture for about controlling leaks. I can just drop that one right in there. That's really cool. And so next, I'm going to move on to the next slide in my presentation. And I heard that our new Chief of Secrecy, Stephen Colbert has some concerns about his part of the presentation. And so actually I can give him a call from my Mac right here at his office. So let's just type up Stephen. There's this work number and I can just dial right here and it's going to dial my Mac. It's going to actually make a speakerphone call through my phone. And by the way, yes, I have the coolest job in the world. I get to talk to Stephen Colbert. Hello? Hi, Stephen. It's Craig from Apple. I'm sorry. I don't recognize that name. Oh, right. Hello, Red Delicious. This is Granny Smith. Over. Is the squirrel in the basket? Roger Foxtrot Thunderbolt Retina Swift Lightning. Okay. The line is secure. Glad you called today. I have some very critical feedback on the content I have some very critical feedback on the content of your presentation today. Specifically, I've got a big problem with my title. Well, Chief Secrecy Officer, that's a pretty impressive title. I just don't think it's big enough to capture how important my role is at Apple. Okay. Let me run this one by you. Hear me out. Supreme Allied Commander of Super Secrecy. I don't know. Craig, if Supreme Allied Commander was good enough for Ike, it's good enough for me. Okay, it beat Hitler. I would also accept intergalactic chancellor. Intergalactic chancellor. How about Supreme Commander? You'll let Tim know. Who? I'm sorry. I mean, Chairman Honeycrisp. Oh, yes, yes. Yes, absolutely. I will let the Chairman know. Glad you see things my way. Now, please get back to work because you know what I see when I look at my wrist? My wrist, here's the garage, chop chop. I am jonesing from Over and out, Red Delicious. I'm glad we were able to sort that out. So, I have one more slide to work on my presentation here. Oh, an email update from Phil about a new badging protocol. So check out this video. It really demonstrates Apple's commitment to badging excellence. Well, that's great. I'm going to drop that one in my presentation. I'm sure it's a great video. So, I'd like to play this now. And what's really cool is I have an Apple TV. We can bring that up here and we can see it can actually AirPlay from my Mac to my Apple TV just like this and project my presentation that way, so we can enjoy the presentation I put together. And of course to control the presentation, the best remote you have is the one you're wearing on your wrist. So I'll just bring up a remote here. Let's see. So there's our secrecy team. Of course, we've got the path to the bathroom, controlling leaks, our new Supreme Commander. And let's take a look at that video from Phil. Thank you. Now, I have a full understanding of continuity. All right. So, this is just a quick overview of the amazing new Yosemite release from its beautiful new design, powerful spotlight search, Icloud Drive, the amazing and elegant new Safari and of course these continuity features. Now there's much, much more to Yosemite than I can possibly cover today, but the good news is I don't have to because now all of you can get access to Yosemite on the Mac App Store today. You know what, it's available for free. There's also 8.1, which has its support for Apple Pay, also Icloud photo library and continuity available for download this Monday and it's free as well. Finally, iWork, an update for OS X also for iOS, also available today and also free. And that is my quick update on iOS 8 and OS X Yosemite. Thank you. Back to you, Tim. Thanks, Craig. It's really great to have Steven on board. I hope he can do a better job than I've done on controlling those leads. I'd like to now talk about iPad. The iPad is this simple and magical device. It's always been a unique blend of simplicity and capability. But while the iPad has been beautifully simple on the outside since the very first one, it has advanced technology just jam packed on the inside. From Apple's custom designed powerful chips to the ultrafast Wi Fi and cellular connectivity to the incredible eyesight and FaceTime cameras, The technology is jam packed in this incredibly thin and light package that you can take with you everywhere you go and use all day long. And as we packed more and more power and more and more performance and more capability in iPad, our customers and developers had begun to use it in ways we could not imagine. And now as you look around, iPad is everywhere. It's transforming the way we work, the way we learn, the way we play. And it's transforming the way we communicate. With so many people using iPad for so many things in so many different places, it's not surprising that we've sold more iPads in the 1st 4 years than we've sold at any product in our history. In fact, we've sold over 220 5,000,000 iPads around the world. To put this in a little more perspective, if you look at the top 4 by volume, PC manufacturers, the number of sales that they've done for the last 12 months and compare that to iPad, iPad beats them all. And this is their entire PC lineup, every notebook, every desktop, every 2 in 1, every all in 1, every toaster refrigerator in 1, all of them. This is pretty fantastic and not by a little, but by a lot. But what's more important to us is that iPad has consistently been rated number 1 in customer satisfaction. This is what makes our heart sing. And iPad Mini Retina has scored an unbelievable 100% customer SaaS. These numbers are you just don't see these numbers in customers that. And so why are so many iPad users so satisfied? We think it comes back to this unique blend of simplicity and capability and the fact that you can do so many things on iPad and you have such a great experience doing it. At the root of this is that we have over 675,000 apps in the App Store that have been custom designed to take advantage of the big beautiful screen on iPad. And this is a huge advantage over our competition. The Burt said it well, a tablet is only as good as what you can do with it. And thanks to the hundreds of thousands of apps for the iPad Air, you can do more with it than any other tablet. This was one of the reasons they named the iPad Air the best tablet you can buy. So iPad Air is number 1 in customer SAD, but it's also number 1 in usage, it's number 1 in education, it's number 1 in enterprise, it's number 1 in consumer. When we launched the iPad Air just a year ago, we did so by showing that all of this power of the iPad was in a design that was so thin, it was thinner than a pencil. You may remember this. So what do you do when you make the best tablet in the world? How do you make it better, you do this. This is the new iPad Air 2. It's unbelievably gorgeous and look how thin it is. Can you even see it? It is so incredible. And to tell you more about it, I'd like to invite Phil Schiller up. Phil? Thanks, Tim. Thank you. Well, good morning, everyone. I'm so excited to be able to tell you about the incredible new iPad Air 2. It is the thinnest iPad we have ever made, just 6.1 millimeters thin. That's 18% thinner than their first iPad Air, which was already 20% thinner than the iPad before it. It makes it the world's thinnest tablet. It is incredibly beautiful to hold all day long. The progress the team has made over just the last couple of years is unbelievable. Here's the original first iPad next to the new iPad Air 2. The new iPad Air 2 is so thin, you can stack 2 of them and still be thinner than the original iPad. It is amazing. What the team has done to pack so much technology and performance into the thinnest iPad is unbelievable. So how did they do it? Let's start with the display. The display is made up of a number of components, primarily the LCD, the touch layer and glass. And in every iPad, there's been a micro thin layer of air between each of those layers. We're not satisfied with that. The team has optically bonded those together, laminated them to make a single component with no air gap. And that reduces the internal reflection and makes a sharper image and a thinner display. It makes the graphics and the text feel like they sit right on top and you're touching them with your finger. It's really beautiful. In addition, we've now created an anti reflective coating for this multi touch surface. This has never been done in a tablet before. It reduces reflections by 56% making it even more beautiful as an image. So it is an incredible display. It is the only tablet that has this kind of a surface and has the lowest reflectivity of any tablet. So this will be the best tablet display you've ever seen in the thinnest tablet, but there is so much more that makes iPad Air 2 great. It starts with the brains inside it, a whole new generation chip A8X. You've heard of the A8 chip with the iPhone 6 and iPhone 6 Plus and it's blowing people away. Well, this is a new version created specifically for iPad Air 2. It is unbelievable. It's a 2nd generation 64 bit architecture. It has 3,000,000,000 transistors. The iPad Air had an A7 with 1,000,000,000 transistors, 3,000,000,000 delivers up to 40% faster CPU performance for most of your apps. Some apps can achieve 2x performance in CPU. And the graphics are out of this world, 2.5 times faster what was already the industry leading graphic performance. Just look what the team has done. The original iPad started with an A four chip and now we're 12 times faster than that with iPad Air 2. But check out this graphics performance. We're now at 180 times faster. Add to that the work the software team is doing with technologies like metal to let developers get full access to that performance without any software overhead. We're able to now deliver console level graphics in the palm of your hand. And that's what a lot of the developers are doing. We're working with game developers and they're now bringing the engines not from their mobile gaming, but from their desktop gaming systems right onto iPad Air 2. And all this power in such a thin package, the team has worked to ensure that you have that great all day battery life, 10 hours of battery, so you don't have to give up any of that. Along with the A8X, we have the new M8 motion coprocessor. This works to read data from the sensors like the accelerometer and gyroscope and it instantly calibrates it so all your apps get incredibly accurate data. And there's also the new barometer for measuring relative elevation and developers can take advantage of that too. But perhaps the feature people love the most about their iPads is the camera, the built in EyeSight camera. Now some people have been surprised by that, but it really makes a lot of sense. The iPad is the best viewfinder for composing your photos and your videos. You can see the scene, you can take incredible photos, you can edit them right on the device and share them instantly with people around the world. And not only do we all like taking pictures and videos, but developers like taking advantage of these cameras to build incredible applications that haven't existed on any other platform. Things like applications for helping coaches train their players with Coach's Eye or consumer apps like Prismo that lets you scan and translate documents on the fly or apps like Cariboo that let a parent read with FaceTime to their children from anywhere around the world. Or Homestyler that lets you create a virtual reality image of your own home than layout the furniture interior design of it. This and hundreds of more applications take full advantage of the cameras we build into the iPad. And they, the developers and the customers who use these apps are going to love the new eyesight camera. It's a huge jump forward for iPad. It's a full new 8 megapixel eyesight camera. It is large 1.12 micron pixels, has a fast 2.4 aperture. It takes photos and 1080p HD video. It has a great sensor. It's combined with the Apple design lens, but really what rounds it out is the brains behind it all, the image signal processing that's done in that 8X chip. And it does an incredible job. I'm going to show you some photos now that were taken with an iPad Air 2, unretouched right off of it and tell me you're not going to be blown away that these were taken with an iPad. Look at that photo. That's a beautiful landscape scene. You can see the quality of the auto HDR that creates amazing exposure. Look at the low noise and that blue sky and it is a remarkable photo. Here's another. People are just not going to believe these are taken with the iPad you bring with you to do work and you're taking incredible photos with it. Here's a shot from above the Golden Gate Bridge. You see the incredible accurate color it delivers and the great depth of field. Is my favorite of the bunch. It's a portrait photo. The skin tones are just perfect. The background is painterly. It's an amazing photo. Of course, we all love taking macros and showing them to the world. Here's a great one. Look at the level of detail in the Fed, as you can't tell, is that taxidermy or live? Don't worry, it's live. For the first time with iPad, you can take large panoramas up to 43 megapixels. So you take your iPad in vacation, you can share your mountain scenery with all your friends. For the first time on iPad, you can take burst mode photos. So taking something that has high speed action, you can grab it just like this photo. Yes, isn't that incredible? For the first time with the iPad EyeSight camera, you can do time lapse. So here's a time lapse. It's taken in Venice. You may recognize it. Now there's a group of boats that are going to start coming down together to see where they are. That was the George Clooney wedding party that came by as we were shooting there. Still waiting for my invitation. This we took recently in Albuquerque at the Balloon Fiesta that's gathering there. It's a lot of fun. Yes, it is. Also for the first time in iPad, you can do slow mo videos. Yes, customers are going to love taking these. This is 120 frames per second at 720p. Pretty cool. You heard that audio. There's now dual microphones to get better quality audio in your videos as well. Well, in addition to the all new eyesight camera and all those capabilities, there's a new FaceTime camera in the front side as well. A whole new FaceTime camera sensor has a larger 2.2 aperture that's in 80% more light and combined with the 8x chip, you get improved face detection for the first time you do burst selfies, which kids love to do. This chip is amazing. It does HDR with a single image, not combining multiple image, which keeps it really sharp. And you can do videos with HDR as well. So with all these great new cameras, all this great new performance, also faster connectivity too. IPad Air 2 is faster WiFi 802.11ac with MIMO that delivers 2.8 times faster performance up to 866 megabit per second throughput. There's also faster LTE with more bands. There's up to 150 megabit per second that's using carrier aggregation and has 20 LTE bands that's more than any other tablet, so it connects at high LTE speeds on more networks around the world. Perhaps the most requested feature from customers is Touch ID. Now like many of us, if you have Touch ID in your iPhone, you've probably picked up your iPad and put your finger on the home button only to see that it doesn't unlock because you didn't have Touch ID. We get used to it so quickly. Well, now with iPad Air 2, there is Touch ID and it reads your fingerprint and quickly unlocks your iPad without having to enter your passcode. And it works with our stores, so you can purchase in the iTunes store, in the App Store. And it works with the new iOS 8 developer apps that support Touch ID. So you can unlock Evernote or Mint or your day 1 journal just with your fingerprint. And as you know, all of us who use iPads, but we're prodigious shoppers. We love to use our iPad to sit back and surf the web and make purchases and particularly with all those 675,000 apps many of them help us make purchases. And now with Touch ID, you'll be able to use Apple Pay to make online purchases. Now this isn't for retail point of sale purchase. This is for online purchasing within all the apps that are going to support Apple Pay and they're going to be many of them growing starting on Monday. So it'll be the best way to shop online. Of course, iPad Air 2 comes with a brand new iOS 8.1 that Craig just showed us and all the incredible features it has. And our developers have had a great time using the performance of the A8X chip and taking advantage of all the power in iPad 2 to do remarkable things and developers have too. We've given a few of them early access to the iPad Air 2 and to see what they can do with it with their incredible applications. I'd like to show you 2 of those this morning. The first is a great team. The 2 brothers started a company in Lithuania and they've had a hit application on OS X called Pixelmator. Perhaps you know it. It's a professional quality image editing application. It's been a big hit on the Mac and now they're here today to show you the work they're doing on iPad. I'd like to bring up Itis to tell you all about it. Thank you. Thank you. After 2 years of work, we are really excited to show you the new Pixelmator for iPad today. It's a full featured image editing app. We are going to open a 4 ks image of the Arabian desert. It's really exciting that we can work so smoothly with large images like this. The new iPad handles those images faster and better than ever before. We created a graphic by using the shadow of the actual ORIX in the sand and some text, which we'll bring in as a new layer. I'd like to place it here at the bottom, but I see there is a straggler ORIX that would interfere with the graphic. So let's remove the ORIX right now. We were able to bring our repair tool from our award winning Mac version to the iPad and it works fantastic. By simply brushing over the Oryx, our app will take care of removing it, but still maintain the background. That is 2 times faster on the new iPad compared to iPad Air. Notice how the texture in the sand is intact even though the ORIX is gone. Let's place the graphic back at the bottom and size it to fit. Now let's blend the graphic with the background to complement the color of the sand. Next, I'd like to apply a filter to enhance the color and darken the edges a bit. We can adjust the depth and strength of the effect. Notice the very fast response time. So that's a quick peek of Pixelmator for iPad coming later this month in the App Store. The power of the new iPad is perfect for the new pixelmater. We've seen improvement of up to 3 times in many aspects of the app. It's a fantastic pairing that would make image editing a breeze. Thank you. Next, there's an exciting new video editing application has everyone abuzz. It's called Replay. It's from a bunch of brilliant scientists from France. And to tell you all about it, I like to bring up Jeff Boudier to show you what they've been up to. With replay, you can use your iPad to create amazingly rich videos without knowing anything about editing. With me is my co founder, Francois. Let's take a look. We all take so many photos, so many videos. Often we don't have time to do anything with them like these videos from a trip in Utah. To make a nice movie edit out of all this, it would take me hours of work, right? Well, let's select all these clips and see how long it takes to replay to make a movie. My movie is already playing. What just happened? In one tap thank you. In one tap, Replay analyzed all my videos, added beautiful motion graphics and synchronized everything to the beat of the music. Okay. Let's do it again. Let's try a different style. I love this style. Replay runs computer vision algorithms to find the best accent color for each video then desaturates the rest. And with metal, this code runs 20 times faster than using the CPU. But this part is too romantic. Let's try something more vibrant. Nice. I love how replay picks the background colors to match the videos. Now I want to add a text slide. Let me show you how easy it is. How about Utah Road Trip? Just as easy, I can add captions, trim videos or reorder things. The result again is instant. We created a custom rendering engine on top of OpenGL and with each new processor, replay gets faster. And with A8X, we get 4 times faster rendering than on A7. Now I'm really excited to show you something never done before on mobile, Prairie Hollywood. See how the light interacts with the text? I can even set the lighting color while my movie is playing. This effect is called volumetric lighting and replay renders it in real time on the iPad. This is truly desktop class performance. We believe video creation should be easy and instant. With this new iPad and metal, our vision becomes reality. This new style will be available end of October and you can get replay for free on the App Store today. We can't wait to see what you'll create. Thank you. Thank you. So those are just two examples from the over 675,000 apps in the App Store that take unique advantage of iPad. And you can see now the apps are doing things on iPad on a thin mobile device that previously would have taken the highest end desktop computers to do. You can do this anywhere you go. So this is the new iPad Air 2, packed with an incredible range of new technologies and innovation, next generation retina display with no air gaps and anti reflective coating, our 2nd generation 64 bit chip for iPad, the A8X with 3,000,000,000 transistors, the new 8 megapixel eyesight camera and all those incredible features, the new FaceTime HD camera, ultrafast 802.11ac wireless and 20 bands of LTE for fast performance around the world. And of course, the most requested feature Touch ID. All of this packed into the thinnest iPad we have ever made. Just have to hold it outside when you get a chance to see just how incredible this is. It will blow you away. So if you want to get one and if you're like me, you're just dying to, what will it cost? Well, first, it comes in silver, space gray and the new gold that you've seen here and it starts at $4.99 That's the price of the previous iPad Air for WiFi with 16 gigs $5.99 for 64 gigs that's $100 less than before and 6.99 dollars for 128 gigs, again, dollars 100 less expensive than before. So much more power, great new features, thinner device and more affordable. There are also cellular versions for $130 more and that is the new iPad Air 2. At the same time, we have an update today for iPad Mini as well. We call it iPad Mini 3. It's the 3rd generation of iPad Mini. It comes in silver, space gray and gold. And of course, it includes the new Touch ID feature as well. It will start at $399,000 $499,000 $5.99 new memory configurations and have cellular versions as well. And both iPad Air 2, iPad Mini 3 are made in the most environmentally friendly way possible. We're really proud of this and always want to point it out. So those are the 2 new lines of iPad iPad Air 2, iPad Mini 3. We're going to keep iPad Mini 2 and iPad Air in the line and reduce them by $100 so everyone has something at each price point. So those are more affordable as well. And the original iPad Mini, we're going to continue to sell it now at an all new price of just $2.49 Previously it was 2.99 So that now means our lineup has the lowest price point ever for iPad $2.49 means iPad 2, Mini 2 and iPad Air have been reduced by $100 We have an all new iPad Mini 3 and all new iPad Air 2 at the high end with more features and capabilities in the thinnest iPad we've ever offered. So a lot of changes up and down the entire line. To get iPad Mini 3 and iPad Air 2, you can start to order them tomorrow. We'll take preorders tomorrow, October 17, and they'll begin to ship by the end of next week. So that's iPad. I think this graphic says a lot in a very simple image about the things we create, how beautiful they are, how incredibly advanced they are at each category and how each one is pushing on the next to be even better and to do even more. As iPad continues to evolve and challenge what a computer can be that you can hold all day long, it then challenges us at the higher end to move those forward as well. And nobody's better at that than Apple. Let's talk a little bit about what's happening with the Mac. We have the best lineup we've ever had. It's the 30th birthday of the Mac this year and these are the best ever and their results are fantastic. If you look at MAC compared to the rest of the industry, this is based on the last quarter, the MAC grew 18% year over year, while the rest of the industry didn't do as well. And the reason is very simple. Our customers love their Macs. This summer, we updated MacBook Air. It got faster, better battery life, better value. People bought them like crazy and the reviews were off the charts. I think this one said it best. In The Wall Street Journal, the MacBook Air is the best laptop ever made. Who are we to argue? The customers who want a higher level of performance, they love the MacBook Pro. It delivers all day battery life, incredible performance and best of all that beautiful Retina display. It's been really fun to watch the migration of the retina display. It started with iPhone, moved into iPad Touch and moved into iPad then into the Mac with the MacBook Pro. Well, today, we're really happy for you to see the continued march of this incredible retina technology and the next step we're going to take with it. We are so excited to tell you about the all new Imac with retina display. There has never been a desktop display like this. It is simply stunning. You have never seen a level of detail in the desktop display as you'll see with this Imac. It is truly remarkable. It's a 27 inches display that has 5,120 pixels by 2880 pixels. If you're really fast with math, you know that is an insane 14,700,000 pixels on one display. It is the world's highest resolution display. It's an incredible feat of engineering. We call it the Retina 5 ks display. So to put it in context, we all look at HDTVs all day. They're 1920x1080. That's overlay those pixels on top of the retina 5 ks display. There are 7 times more pixels on the retina 5 ks display than on your HDTV. And let's compare that to the new standard 4 ks digital cinema and there it is, 496x2160. The retina display still has 67% more pixels than that. It is stunning. What's more remarkable is that we work the engineering team to fit those 14,700,000 pixels into our beautiful Imac design. It's just 5 millimeters thin. It's an incredible feat of engineering. It took a lot of invention. It starts with the chip that controls the display. It's called a timing controller or TCON. 1 didn't exist to drive this display quickly and efficiently, so our team had to invent 1. It started with having to create a new material oxide TFT to be able to charge those pixels quickly and evenly across the whole display. It meant taking technology from our retina iPad display, organic passivation to reduce crosstalk because those pixels are getting so close together to keep the image really sharp and beautiful. It took building a new backlight technology, an LED backlight that's just as bright as previously, but consumes less power and is thinner. And all put together, this new display with 4 times the number of pixels of the previous version uses almost a third less energy. That's incredible work. And to make it even more beautiful, we use our Apple photo alignment technology to give higher contrast ratios on axis and a new compensation film, so it looks better off axis too. It is a remarkable feat of engineering and the most beautiful desktop display for everything you do. When you read text, it looks incredible crisp and sharp with magazine quality. If you work with photos, you'll have never worked at a desktop display with this level of detail in your photos. And if you love to edit video like here in Final Cut Pro, you've never had the ability to do 4 ks video editing pixel for pixel with room left over for your bins and timelines. And if you're Craig and you've worked so hard on a beautiful version of OS X, there has never been a display to show off that great new user interface as beautiful as this new retina 5 ks display. We have a brief video to tell you a little bit more about it. The Mac enables people to do amazing things. And for many people, it's the most important creative tool that they use. And what we really love doing is making it better. On an Imac, the experience begins with the display. And now we're really proud to introduce the first Imac with the Retina 5 ks display. With 14,700,000 pixels, this goes way beyond HD. It gives the ultimate all in one computer the ultimate display. And it means you see incredible detail on a scale that just hasn't been done before on a desktop. We started by moving to an oxide TFT or thin film transistor panel. Oxide TFT is needed get these many millions of pixels to charge quicker and then stay charged longer. We manufactured an oxide TFT based display more precisely than it's ever been done before. One of the great results is the vivid brightness you see across the whole screen. Communicating to all of those pixels requires a lot of brainpower. In a display, it's called the timing controller or TCON. The TCON tells every pixel what to do and when to do it. For this new retina display, a T con didn't exist that could do the job. We had to create it. This single incredibly advanced chip is responsible for directing millions of pixels. Whether you're looking at photos or text or even editing 4 ks video, The picture is stunning. We've also improved the contrast ratio, so you get brighter whites and darker blacks from any viewing angle. When I'm working on imagery, I need to see the details in it to make accurate judgments of color and exposure to be able to make it look on screen exactly how it appeared to me when I saw it in reality. With this display to be possible, millions of pixels have to be driven with more energy efficiency. We use power saving LEDs and organic passivation, which enables a clear, accurate signal to be sent to each pixel. This dramatically increases the display's performance and image quality while actually decreasing its power usage by 30%. Every photograph I shoot, there's so much work to be done before it's really finished. To get there, the tools I use need to be powerful and precise. And now that I've had a chance to experience the sharpness and the resolution and the incredible tonal range in the new Imac, I just can't imagine a better tool for the work I do. With its stunning retina 5 ks display and all of this new capability, the new 27 inches Imac is by far the most amazing Imac we've ever built. So not only have we built an Imac with the most incredible display we've ever made, but throughout the product line, we've updated everything to make it the best iMac ever. So if you look inside it, it has the fastest chips we've ever put in an iMac. It starts with a 3.5 gigahertz Intel Quad Core i5, but upgradeable to 4 gigahertz i7, the fastest ever in an Imac. The graphics for Radeon R9M290X upgradable to a 295X. So how fast is that? The previous fastest chip in an Imac was 2.4 teraflops of compute power, not bad. This is 3.5 teraflops, 45% faster than the previous version. IO is faster as well. It is now Thunderbolt 2, 20 megabit per second bandwidth per port. It's faster storage standard terabyte Fusion drive and it's all built together like all of our products in the most environmentally friendly manner including supporting the latest Energy Star 6.1. So it's a very efficient desktop product. So what does this amazing state of the art new Imac cost? Well, let's make a comparison. If you've ever tried to buy a high end display, for example, a new 4 ks IPS TFT display, not quite as many pixels as the Imac, not quite as beautiful display, but still not bad. You know that these range in the price of $3,000 or more. So that's why we're really excited to tell you the new Imac with Retina 5 ks display is going to cost 24.99 dollars And for that, we throw in an entire computer. It's got a 3.5 gigahertz i5 standard Radeon R9 chip, 8 gigs of memory and a terabyte Fusion drive. And it starts to ship today. So that is the new Imac with retina display. It joins the rest of the Imac line, a 21.5 inches Imac starting at $10.99 27 inches Imac starting at $17.99 and new Imac with Retina 5 ks display at $24.99 I can't wait for you all to see it and experience the incredible images that it produces. There has never been a desktop computer like it. I think it's the perfect fitting to the 30th birthday of Macintosh. We have one other small update today and that's a computer that a lot of our customers love who are getting their very first Mac. It's called Mac Mini. Perhaps you've added one to your own home network, but we have a whole new version today. It's updated with faster processors, 4th generation Intel Core Processors, faster graphics Intel Iris and HD Graphics 5000, faster storage, PCIe based flash storage, faster Wi Fi 802.11ac and now has 2 Thunderbolt 2 ports. So it's packed with all the IO you need in a very small design. And most important to us, it is not only compact, it is the world's most energy efficient desktop computer, which is really great. A lot of customers choose this for their first Mac. Previously, Mac Mini started at $5.99 The new faster, more capable Mac Mini starts at just $4.99 And it's shipping today as well. So that's our update for the Mac. Let me turn it back to Tim. What do you think? It's a very cool start. This is the strongest lineup of products that Apple has ever had. And we believe that each one of these play a very important role. People need different types of technology for the way they live their lives. We all do different things. In fact, many of us and many of our customers use more than one of our products every day. Sometimes you want to sit at your desk in front of a huge, beautiful, immersive screen packed with powerful technology. And we've made that much better today with the retina 5 ks screen for IMAAC. Sometimes you want to take that powerful technology with you wherever you go. And we've made our notebooks even better this year with MacBook Air and MacBook Pro. Sometimes you want to be close to your content, touching it. And we've made that experience even better today with the iPad Air 2, more powerful and incredibly thin. Sometimes you want to hold that powerful technology in the palm of your hand and there's no better thing for your hand than the iPhone 6 and iPhone 6 Plus. And soon you can wear that powerful technology right on your wrist. Now this incredible lineup of products and the ecosystem that supports them is something only Apple can create. They're designed to be incredible products individually, but they're also designed to work together seamlessly. And because we create both the hardware and the software, we can deliver something that no one else can do, a simple, intuitive and yes, a magical experience for our customers. This is our vision of personal technology and we are just getting started. I'd like to thank all the teams at Apple that have worked so hard for not only this year, much of what you see here is multi years of work to bring these products out on top of all the other things that you've seen during the day. They are doing the best work of their lives. And I and the executive team really appreciate it. I want to invite all of you to come across the hall to get your eyes on this retina 5 ks display. You're not going to believe it, it's killer. And to hold the iPad Air and see how thin and powerful it is, We also have a station set up next door so that you can try out Apple Pay if you haven't tried it yet and you can be among the first to buy something on it. Thanks very much for joining us.