Beijing time on February 7, 2022, coinciding with the first working day of the Chinese New Year of the Tiger, foreign media reported that Tesla may be developing an apple-like app store, so that Tesla car users can download and install applications through the app store, in fact, the new version of V11 pushed in December 2021 has a point.
In Che Zhijun's view, this is also the most anticipated business model of the entire automotive industry in 2022 Tiger - Tesla creates a business ecology of smart car hardware + software through the application store, especially the business ecology of smart car hardware + software realized by completely driverless. Even, this is not only the most anticipated in the automotive industry, but also the most anticipated by the whole society.
The century-old automobile industry will enter a new business model - the Apple model. Apple's model is that in addition to making money on hardware, you can also make money through software services that pay monthly, which is one of the business models that Tesla under Musk most hopes to expand. In the Year of the Chinese Tiger in 2022, this business model will appear 100% unsurprisingly.
Once Tesla launches the app store, all car companies want to follow close behind, if you can superimpose the commercialization of fully autonomous driving, there will be great business opportunities, the valuation system of all car companies may change, but the threshold for doing well is extremely high. For car owners, the functions and services enjoyed in smart cars will far exceed cars, and the value of smart cars will far exceed smart phones for the entire social system.
01
Tesla App Store and Startup Opportunities
In December 2021, Tesla pushed the V11 version of the in-vehicle operating system, one of the biggest changes is the appearance of a customizable icon bar at the bottom of the touch screen, which is also considered to be Tesla preparing for the launch of the app store, foreign media reports are also expected, but Musk did not announce the specific launch time in the latest earnings call or his Twitter account.
However, the industry is expecting Tesla to launch an app store. Previously, Tesla has continuously enriched its software service capabilities in the process of OTA, including the launch of a variety of games, light shows, custom body colors, Thunderstone KTV, NetEase Cloud Music and so on. In fact, these software services can be charged or built-in charges.
In addition to relying on software service charges, Tesla can also make money by selling peripherals, for example, Tesla KTV's wireless microphone, Tesla Games' wireless gamepads, and more Tesla peripheral products, and these peripheral products due to the role of the brand halo, gross profit will be extremely high.
The Tesla App Store, for entrepreneurs, may also be a major entrepreneurial opportunity, just like the entrepreneurial opportunity in the mobile Internet era of that year. However, this cycle may be longer. Entrepreneurs with innovative spirit are also needed to provide better services for smart car users.
According to Che Zhijun's understanding, Leishi KTV, which is stationed in Tesla's on-board system, is a start-up company, and before the V11 update, there were friends in the capital market who were pushing this project for financing. This may appear similar software or software + hardware entrepreneurial opportunities, just like the entrepreneurial opportunities that entered the APP Store to develop app and then come out to raise funds, of course, it can also be stationed in the car machine system of other car brands, because the APP in that year had to go to iOS and Google Android two major systems.
At present, Tesla's software services do not charge much, mainly autopilot software EAP and FSD, and the once launched acceleration package (which can increase the acceleration capacity of the vehicle). Tesla has also launched monthly subscription EAP and FSD services abroad, and the acceleration package may be a paid service that Tesla will push this year, after all, the 2022 Model 3 and Model Y 000 km/h accelerate by nearly 7 seconds, which is the slowest Tesla in history.
What's more, Tesla delivered Tesla vehicles in the second half of 2021, the function of supporting wired gamepads in the glove box was canceled, and the latest news is that Tesla is going to launch an official Bluetooth gamepad, and linking the official Bluetooth gamepad can unlock more games. This behavior is a bit disgusting, just like the NIO Pilot selection package launched by Weilai, Tesla's free AutoPilot function ACC, LKA, CTA-R and other functions, in Weilai to spend 15,000 to buy a selection package to enjoy.
Car companies hope to diversify their revenue, but how to balance the basic needs of users, even the basic needs of safety, and balance their own revenue ambitions, this is the need for car companies to think more and balance. But there is no right or wrong in business, and Porsche's rough cars are still as hot.
02
The potential value of the Tesla App Store
Before discussing the potential value of the Tesla App Store, let's take a look at the data from the Apple App Store.
In July 2008, Apple's iOS App Store was officially launched, and in 2018, when the APP Store was launched on the 10th anniversary, statistics showed that there were more than 2 million available apps in the APP Store at that time, with a total of more than 170 billion downloads from July 2010 to December 2017, and a total user expenditure of more than 130 billion US dollars.
According to Apple's 2021 Q4 financial report, App Store, Apple Music and iCloud subscription sales, Apple's service revenue in the quarter was $19.5 billion, up 24% year-on-year, exceeding the market expectation of $18.6 billion. Apple's strong software service capabilities made Apple the first technology company to break through the $3 trillion market value.
Software service revenue has become one of Apple's fastest growing revenue businesses now, the proportion of revenue is also increasing, and due to the marginal cost of almost zero software service cost characteristics, software services for Apple's net profit contribution is also increasing, in Q4 2021, Apple revenue reached 123.9 billion US dollars, net profit of 34.63 billion US dollars, net profit margin of 27.95%.
For Tesla, launching the App Store one day in 2022 is similar to Apple's iOS App Store in July 2008. On the one hand, it has created a new business era of intelligent car hardware + software, on the other hand, it can also provide a new entrepreneurial direction for global technology - intelligent cars + all walks of life, or travel + all walks of life, somewhat similar to the Internet + all walks of life, mobile Internet + all walks of life.
However, whether the in-car application store can play the greatest commercial value depends on the progress of completely unmanned commercialization, once completely unmanned can be formally commercialized, smart cars + entrepreneurial opportunities in all walks of life will explode, and smart cars will reconstruct the travel mode, living mode and so on of human society.
Once such an opportunity arises, the value of the Tesla App Store, or the value of the Smart Car App Store, will be immeasurable. App Store, Apple Music and iCloud subscription sales contributed $19.5 billion in revenue to Apple in a single quarter, and smart cars' sensors, range of applications, perception capabilities, and bicycle value are likely to exceed mobile phones.
The only uncertainty is the amount of ownership, in the 2021 Q4 earnings call, Cook said that Apple's smart device activity is 1.8 billion units, and the activity of a single smart car brand may be one or even two orders of magnitude lower, which is why Musk has repeatedly emphasized sales, and hopes that by 2030 Tesla's annual sales will reach a staggering 20 million vehicles, to know that the peak of global car sales is only 100 million a year, Volkswagen and Toyota reached the level of 10 million vehicles.
Musk has also criticized Apple for only the high-end machine market, and Tesla prefers to cut into the mass consumption car market - everything is sales, sales, sales. More importantly, the production capacity of automobiles is much lower than that of mobile phones, and the production capacity of Tesla in 2022, nearly 20 years after its establishment, may also be 1.5 million to 2 million. In contrast, the production capacity of mobile phones has increased rapidly, which also gives other brands the opportunity to time windows. However, once the market enters the stock market game from the incremental market, the competition will be extremely fierce, and the number of car companies may eventually be counted in one slap, that is, no more than 5.
In terms of user base and bicycle value, Tesla hopes to have a breakthrough, so that the premise can maximize the commercial value of Tesla's app store, or Tesla's software charging model.
This is why, globally, the vast majority of tech giants want to get involved in the automotive industry, the commercial value of smart cars is too great, and faces a certain opportunity for change, the era of industry change means a redividing of interests.
The intelligent automotive industry, perhaps with the emergence of tesla app store, there will be greater entrepreneurial opportunities, will attract more talents to participate in it, attract more capital to participate in it, high-intensity capital and high-intensity talent density, can accelerate the development of the intelligent automotive industry.
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