[perardi]

Let’s run through the possible reasons Apple announced this, with various degrees of cynicism.

1. Getting some good press before Congress decides to do something in regards to the app store model.

2. Apple is reading the winds, seeing that Chinese supply chains may be politically constrained, and preparing for that future.

3. Apple is reading the winds, seeing that Chinese supply chains may be politically constrained, and announcing this investment so they can continue to have Chinese supply chains after a good PR move.

[jacobr1]

4. Apple was planning to do these things anyway as part of normal operations, and is just spinning them as "investment in the country"

[delfinom]

Yep, all tech companies have seen the writing on the wall for overconcentrating their operations in California. People in general have become more and more hesitant to move there for a wide platitude of reasons from absurd cost of living to issues such as mass wildfires.

They've realized that perhaps, just perhaps, they could afford to have more than one large corporate campus at their scale of fuck you money. Which gives them wider access to talent and actually reduces headaches such spiraling cost of living forcing salaries to also spiral upwards and also being expected to solve housing crises locally.

[dangus]

Comments like these greatly downplay the role of industry clusters. The hot take of the day is that California is a hellhole to be escaped as soon as possible.

Industry Clusters are often historical, so it always strikes me as strange when I see comments like this one that make a case for how misguided it was for tech companies to cluster in Silicon Valley and tolerate the high cost of living.

That line of thinking misplaces causes and effects so that they’re hilariously backwards.

Silicon Valley is a innovative place because of an extensive history of educational institutions, research facilities, and other market conditions that simply did not physically manifest in any other place.

On top of all that, the software industry has one of the lowest COGS (cost of goods sold) of any major industry. Facebook’s sales per employee is close to $2 million [1]. The fact that their SV employees cost hundreds of thousands of dollars more than employees is quite nearly irrelevant. Someone that’s 10 or 20 percent more productive will make up that labor cost difference by bringing in 10 or 20% more revenue, so it doesn’t really make sense for Facebook to abandon the best talent pools in search of cheaper rent or wages.

Tech giants are building out in Austin for its specific traits, and they don’t seem to mind that it’s rapidly becoming expensive and congested just like California. The question that might be asked is: why is Apple in Austin instead of Houston or Dallas or Nashville or Omaha?

[1] https://csimarket.com/stocks/FB-Revenue-per-Employee.html

[offtop5]

The big difference is Texas isn't ran by morons who make it impossible to build homes.

The anti building laws of California are by far the biggest reasons housing is so expensive. Even if Austin gets pricey, you can always drive into the city.

As someone who left California, I will say no one in their right mind should live there. No matter how much you earn, you'll never realistically out earn the cost of living. I found myself quickly deep in credit card debt trying to be cool in California. It's just a horrible place to live, I had to estrange myself from my family to move, and it was absolutely worth it. Anyone who tries to make you live in such a horrible place does not care about you at all.

People are also phenomenally nicer in other cities, I was shocked at how easy it was to meet my girlfriend once I got to Chicago. It's as if Chicago's this amazing City where people understand you need to work to get things you want instead of thinking you're entitled to everything.

Anyway, with remote work now being seen as viable I can see the idea of having expensive big offices becoming antiquated.

[ribosometronome]

Apple already has a large campus in Austin that dwarfs a lot of companies and a second under construction. They might not be quite Spaceship in terms of unique design but they exist.

Being solely located in one of the most expensive areas in the United States does seem a bit absurd if you can avoid it. Based on Cook's statements about returning to the office, it seems like they value being physically proximate more than the immense savings that moving the workers who could be remote to remote.

[Angostura]

Just an FYI - I'm not sure what word you were reaching for, but it wasn't 'platitude' in this context.

Perhaps 'plethora' or 'multitude'.

[sizzle]

Seems like they were going for latitude?

[mft_]

Neither would work well with the preceding ‘wide’.

[throwawayboise]

variety. Or better yet, drop "a wide variety of" and just say "various"

[sizzle]

“wide latitude”

[cletus]

100% this.

So many of these corporate investment announcements are really "look at what we were already going to do".

Amazon HQ2 anyone?

[zepto]

But surely ‘what we were already going to do’, must include hedging against predictable political changes.

[blackearl]

They're upping it from $350B so they were most of the way there.

[shagmin]

I live near the area where they announced the North Carolina 'investment'. A land holding company associated with Apple bought some land in the RTP area years ago around the time they announced the new Austin headquarters. NC had just passed a controversial law (HB2) which scared away a lot of business from the state (it has since been mostly reversed). There's speculation the announcement for the NC campus could've probably happened years ago if it weren't for that law.

[Daishiman]

Don't forget 4. doing a good PR so that a Dem-controlled Congress doesn't push for repatriation of corporate cash reserves kept in tax havens.

[mrweasel]

$430B seems like more than you'd need for a good PR stunt.

[skrtskrt]

It's $0 if you were already going to spend it anyway

[perardi]

I suspect they really were going to spend a significant chunk of this regardless, but they packaged it into a nice press release at a potentially fraught political moment.

And…$430 billion over 5 years is a lot, but what if it influences tax or tariff rates just a bit in your direction over a 10-year period? Because that could be worth it, especially, again, if you were going to set up that new campus anyway.

[zepto]

> I suspect they really were going to spend a significant chunk of this regardless

Regardless of what?

[perardi]

Regardless of this PR they put out.

This spend was probably in the books, so let’s wrap it in a nice bow before Congressional hearings.

[zepto]

It seems inconceivable that they wouldn’t have made a PR announcement about a large investment in the US, regardless.

[sircastor]

Didn’t they do this with the former administration’s tax deal?

[jimmont]

Apple and much US associated supply chains have already been moving away from China. Media is regularly coming up where the side effects are reported, for example the Foxconn contractor in India. The US lacks the infrastructure to leverage talent or capacity domestically. The only thing that will fix this is government policy--otherwise Silicon Valley would have decent transit, no homelessness and California would have its own State or region-level healthcare delivery network. The same things Taiwan has with only 23 million people that benefits TSMC (and the people there).

[syshum]

>The US lacks the infrastructure to leverage talent or capacity domestically

I dont think infrastructure is the root of our (US) problem. We do have a skills, and talent gap. not just in "tech jobs" like many people think but at factory floor level as well.

Even if they could open the factories tomorrow finding people to fill those jobs will be hard.

[jimmont]

Personally I see infrastructure as the thing that gets qualified people to productivity and keeps them productive (jobs or whatever form that takes), and I also expand the notion of infrastructure to include a society and community with effective education and healthcare to maximize the human capital of the group. Given this I see infrastructure and the various components of it as decades behind in the US and Apple would be smart to take the direction. Just consider the process of applying for an SBIR or finding a job or starting a startup or getting from SF to San Jose, etc.

[syshum]

This would require the expansion of the term infrastructure to encompass just about everything in society thus making the term meaningless.

This is the current Democrat definition of the word where everything from health care to education is "infrastructure", that is not what the average person would consider to be "infrastructure".

Healthcare and Schools are not "infrastructure", "infrastructure" would be Roads, Power, Communications, Basic Utilities, etc etc etc.

>> Just consider the process of applying for an SBIR or finding a job or starting a startup or getting from SF to San Jose, etc.

Given that California is the least business friendly state in the union, in fact it is down right hostile to business I would image doing anything in CA is pretty hard

[gonehome]

If I was Apple getting out of the Chinese supply chain would be a priority - if only to have some leverage with a second option.

It seems like a pretty high risk situation for them and has chilling effects elsewhere (content restrictions on Apple TV). It also damages their brand ethos around privacy. CCP pressure on Taiwan and TSMC is also a concern I'd be thinking about if I was them.

[dillondoyle]

TSMC is the scariest thing in my mind.

I wish Apple or govt would fund similar fab/s in the US - hell just build it with stimi or huge tax breaks and TSMC can still hold the IP and profit, just have enough onshore knowledge to run it in isolation if needed.

CCP hitting TSMC in their first strike would be a hell of a whammy, even if mutually destructive.

[StandardFuture]

> app store model

Yes, well we as a developer community can never let up on Apple and Google's app store models being legally reprehensible.

We are quite literally the most negatively affected community by these monopolies over general consumer's devices.

We need to be the "force to be reckoned with" here and constantly petitioning politicians for action else get campaigned AGAINST electronically (our domain).

I would say that the app store model negatively affects a growing "small software business" sector of the economy which will only continue to grow as a stable pillar of the modern middle class.

In other words, this is only becoming that much more of a critically important issue.

[coliveira]

Most of the so-called "investment" is real estate based. They will most probably develop some very expensive offices, fancy stores, put some additional people to work there, and call it a day.

[ksdale]

Or they are anticipating some sort of tax on funds held offshore and figure it is better to repatriate the money prior to a tax increase.

[plank_time]

Apple is already moving out of China for some of their factories. India was a big target for this.