♪ emily: it has been nearly six years since tim cook to go over apple for steve jobs. he put off the largest acquisition in apple history. he is taken on issues like the environment and education. he maintains a dialogue with president trump despite their disagreement on climate change. now, as i've been sales plateau, questions remain -- i-phone sales fifo, questions remain. we sit down with tim cook and talk about apple's homepod, a direct challenge to amazon and

google. apple ceo tim cook. emily: thank you so much for joining us. tim: great to see you again. johnathan: -- emily: why should people buy homepod? tim: we try to build something that is a breakthrough speaker first. music is deep and o -- in our dna. we wanted something that sounded unbelievable. it does a lot of other things but we wanted a really quality audio experience. emily: you're focused on how to reinvent music in the home, will idea what to make a phone call, college park or order groceries -- call a car or order groceries? tim: there are a lot of things that siri knows how to do with the phone. we start with a batch of those. emily: let's talk about e-commerce. i can order paper towels on my amazon and him. does this -- i can order paper towels on my

amazon echo. tim: we think we can reinvent it and the home. we know that people want a speaker to do more than that. obviously we want a speaker to do more than that. we are combining what has been thought of to be two distinctly different things for now. emily: how long have you been working on this? tim: several years. the underlying technology here is something to the hold. to get the experience we wanted at the price he wanted, it took years. emily: you have people out there saying finally, what took so long? >> for us it has never been about being first. if you think back, we did not have the first mp3 player or the first smartphone or tablet. arguably we shipped the first modern tablet and smartphone but we were not first. it is about being the best.

emily: it is the 10th anniversary of the iphone. you unveiled ios 11. >> it is unbelievable. but for iphone and ipad. it has amazing things in it. an area that i have great personal excitement, but i am incredibly excited about ar. as we get this out in the hands of the developments, we will have the largest augmented reality program in the world. emily: what about consumers? tim: with a core technology and as a platform owner, the first thing, arguably the first thing is to build the foundation and from that foundation you can do anything off of it. emily: peter thiel said he believes that innovation in smartphones is ever. are there more quantum leaps? tim: i do not agree with that view at all. when i think about all of the things that are going to change from a core technology point of view in the future, i think we are just getting started.

i'm incredibly excited and clearly there is nothing that i think anybody would say is going to replace the smartphone anytime soon. as time has gone on, the smartphone has become more important to people's lives. when it started, the phone call was still a dominant reason for having it.

now if you look at what people are doing on smartphones, it is a minor piece of what a phone is now. when i look at the health kit and what that has to done in terms of getting people's health the data. -- people's health data. i think about all of these things, the usage of it, it is

something where you don't leave home without your iphone. it is in the early stages still. emily: controlling your home with your device is a fairly niche behavior, do you think that will become more mainstream? tim: i think it will become more mainstream this year. we built it into ios 10 and after that you saw more and more accessories coming to the market that are home kit enables. we just made it easier for accessories to be compatible with home kit.

you can use software encryption. you not need hardware encryption to go. that unleashes more accessories to join and people are going to want to automate different parts of the home. i would not live without it at this point. it is one of those things, how could i have done that in a different manner? emily: in the past he said the iphone is our biggest expression for the future of personal computing. tim: we make both of the ipad and iphone. some people will only buy mac and many will only by ipad and we try to do both. we try to bring more productivity features. people think they would rather have an ipad pro. i think that people who have an ipad will launch an upgrade but the mac remains very important to us.

both of them are computing devices and we are going to keep investing in both because we think both are a great feature. one of the reasons why ipad on the surface, the units are going down, keep in mind that the ipad mini came out at a point in time when smartphones were small. people have four inch screens on their smartphone. one of the things you are seeing is a national movement to a smartphone, not taking all of

the market but taking a piece of it. we are growth rates that have shocked us. emily: you called president trump and urged him not to pull out of the paris agreement. what does that mean for your relationship with the president? emily: you have been engaged with this white house, you called president trump and urged him to not pull out of paris. he did not listen. emily: i think -- tim: i think he did listen to me. i don't think he decided what i wanted him to decide. i think he decided wrong. it is not in the best interest of the united states but in terms of -- do you interact with politicians or do you not? my view is, things are about, can you help your country and if you can help your country and do that by interacting, you do it. country eclipses policy -- politics. if there is something we can work together that helps people in the united states, then of course we would do it.

emily: you have other people -- emily: you have been engaged with this white house, you called president trump and urged him to not pull out of paris. he did not listen. emily: i think -- tim: i think he did listen to me. i don't think he decided what i wanted him to decide. i think he decided wrong. it is not in the best interest of the united states but in terms of -- do you interact with politicians or do you not? my view is, things are about, can you help your country and if you can help your country and do that by interacting, you do it. country eclipses policy -- politics. if there is something we can work together that helps people in the united states, then of course we would do it. emily: you have other people who are leaving the table, like elon musk. is the president jeopardizing his relationship with the business community? tim: there is a difference between leaving a council and devising in a way that can help our country. the first one is a judgment call that people make.

i did not join a council so it is not a decision i had to make. i understand both sides of that. but doing something that you believe will help america is a requirement as a ceo. if i get the chance to pitch in the paris agreement again, i'm going to do it again because i think it is important that we engage to fight climate change on a global basis. this is something where we cannot solve it country by country, it requires a global action. the missions created in one country affect another. it is something that we feel very strongly about and i wanted to do every single thing that we

could do to tell how important it was to stay in the agreement and unfortunately he decided something different. emily: why didn't you it joined the cou --why didn't you join the council? >> my primary job is being the ceo of the company. i spent the majority of my waking hours doing that. i do not find these councils in general and committees to be terribly productive. it was not about not wanting to advise on something where i thought that we could help or we had a 20 view that should be heard. -- we had a point of view that

should be heard. i am first and foremost an american. emily: repatriation, this would be an issue important to apple. how would you like the repatriation bill to be structured? >> in our view it should be a gains repatriation. it should be a record tax. you are not asking the people that have had earnings from their international subsidiaries if they would like to bring that money, you are saying you must pay the government x percent now or over a time. my own advice would be that the u.s. needs that money for significant infrastructure spending because it creates jobs. a few people would argue that we do not need investment in america. i think it should have been done

years ago but it has a knot. tomorrow is good. emily: you made it clear the privacy of apple users is of utmost importance to you even as terror attacks continue to happen around the world. does a new ios strengthen user security? tim: our heart goes out to everyone affected. the attacks are horrendous and the u.k., for us, we have been in the u.k. pretty much of the whole length of time for our company. it feels like they are a neighbor. we have thousands of employees there. what do we do from helping with this, we have done one thing since the beginning of the app store, we do not want hate speech on there. i'm not saying that we will

never make a mistake but i do not know of a case where something has gone through. we have been cooperating with the u.k. government and not only in law enforcement matters but on some of the attacks. i cannot speak in detail but in cases where we have information and they have gone through the lawful process, we not just to give it but we do it very promptly. i would hope that they would say that we have been helping well. there is a men's understanding about -- encryption does not mean there is no information. metadata exists and if you're putting together a profile, it is very important.

emily: can we assume apple is working to make encryption even stronger? tim: the reality is that this is cyber attack on people and the government, is happening left and right. these affect your safety, your security. it is not just privacy. it is not privacy versus security, it is privacy and security versus security. we are always working on trying to stay one step ahead of the attackers who have gone from the guy in the basement, a kind of hobbyists, to a significative enterprise. we do not think our users should have to think through all these

things. we try to stay one step ahead of these guys. emily: you said cars are an area, how important is it that apple not miss out on a car? emily: let's talk about the world's second-biggest economy. china. how does apple navigate the uncertain political waters there? tim: apple makes all of our decisions for the long-term. we are thinking about many, many years out. as i seem back and look at china, i see mega trends there that make china an incredible market. i mean a market for application developers, we have 1,000,500

application developers in china.

emily: let's talk about the world's second-biggest economy. china. how does apple navigate the uncertain political waters there? tim: apple makes all of our decisions for the long-term. we are thinking about many, many years out. as i seem back and look at china, i see mega trends there that make china an incredible market. i mean a market for application developers, we have 1,000,500 application developers in china.

it has been an amendment that's an incredible marketplace -- it has been an incredible marketplace. the short-term economic news, i do not get too excited. emily: how realistic is it to expect the double-digit growth to continue in china for apple? tim: i think we will do better this quarter then we have the last several. that does not mean we are growing double-digit where we are going to grow, it means it

will be better from a year-over-year from the previous one. i feel good about that. iphone 7 is the third more popular cell phone in china. the size of our business was almost 50 billion in greater china. we're going to stick at it because china is a huge

opportunity overtime. emily: how would you characterize tim cook's apple versus steve jobs'apple? tim: steve's dna will always be the dna of apple. it is deeply embedded in the company and we celebrate it and it should be staying like that. obviously think the ball over time in certain areas --obviously things evolve. emily: you said cars are an area ripe. how important is it that apple not miss out on cars? tim: there is a major disruption moving. not only for self driving cars but the alleged occasion. if you have driven and all electric car, it is a marvelous experience and his marvelous not to have to stop at the filling station.

plus, you have ridesharing on top of this. you have three vectors of change happening generally in the same timeframe. if we look at it in what we are focusing on or what we talked about focusing on publicly, we are talking about autonomous systems and one purpose of a time the systems is self driving cars. there are others. we see it as the mother of all ai projects. it is probably one of the most

difficult ai projects to work on. autonomy is something that is incredibly exciting for us and we will see where it takes us. we're not saying from a product when if you what we will do -- product point of view what we will do but we are saying it is a technology we see is very important. emily: you're working on so many different platforms, tv, watch, phone, mac, what you see as innovation for the future of personal computing? tim: they are all built on the same core technology but we thought through how they are used and the experience that is needed to get the best experience for the user in each of those cases. emily: everyone will be speculating. apple ceo tim cook thank you.

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