Monday was the day Apple (AAPL) faithful wait for every year: the company’s World Wide Developer Conference.
While the conference is focused on introducing the development community to the latest versions of Apple’s OSX computer operating system and iOS mobile operating system, but the entire tech world tends to be watching closely for the opening keynote, where features of the next generation of Apple’s software are previewed — and new hardware is sometimes revealed. (The iPhone 4 was a 2010 WWDC reveal, for example.)
This year, the anticipation had been higher than usual. WWDC 2013 was the debut of iOS 7 — offering the first glimpse of Apple’s new mobile operating system since Scott Forstall, former SVP of iOS software, was fired in a management shakeup last year — as well as other devices and services.
New Hardware Unveiled
Apple’s MacBook Air was a surprise hit that’s turned into a consistent bestseller, stymying efforts of Ultrabook manufacturers to catch up. The new MacBook Airs use Intel’s (INTC) new power-efficient Haswell CPU and faster Flash drives to boost performance while delivering what Apple describes as “all day” battery life. Translated, that’s nine hours for the 11-inch version and 13 hours for the 13-inch model.
New Mac Pros were also revealed, sleek black aluminum canisters (1/8 the size of the old model) packing up to 7 teraflops of computing power and the ability to drive three 4K monitors simultaneously. Graphics, film and publishing professionals will love this machine, while Apple gets bragging rights since the new Mac Pro has been confirmed as the “Made in the U.S.A.” model Tim Cook had earlier alluded was coming.
Apple’s new computers are also equipped with Gigabit Wi-Fi, courtesy of new 802.11ac cards that offer triple the speed of the current 802.11n standard.
The big surprise with Apple’s desktop operating system was its name. After sticking with a big cat theme since its launch — Tiger, Panther, Snow LeopardMountain Lion, etc. — Apple is switching to a California theme. OSX 10.9 will be known as Mavericks.
Mavericks is packed with tweaks including under-the-hood memory and CPU optimizations to increase battery life on notebooks and usability features like improved support for multi-display setups.
This was, without a question, the most important part of the keynote. Last year at this time, Apple was riding high on record iPhone 4s sales and fevered anticipation for the iPhone 5 and iPad Mini. Now, it’s in a slump with worries that the iPhone is losing its competitive edge over smartphones running Google’s (GOOG) Android or Microsoft’s (MSFT) Windows Phone.
In a move clearly calculated to address investor concerns, CEO Tim Cook focused on a mobile area that Apple still dominates: 82% of tablet-generated web traffic comes from an iPad, while 60% of all mobile web traffic is iOS (Android is responsible for 24%, in comparison). 73% of iPhone users are “very satisfied” with their devices (32% for BlackBerry, 49% for Android and 53% for Windows). Unlike the fragmentation mess in the Android camp, 93% of iOS users are on iOS 6, the latest version (33% of Android devices are now running Jelly Bean).
Android’s capture of 70% of the smartphone market doesn’t sound quite as scary when framed in those terms. At least that’s what Cook hopes.
The new look iOS 7 is meant to reinvigorate Apple’s mobile products, addressing concerns that the operating system was aging in comparison to the new Windows Phone 8. It also needs to address a deficit in key functions that Android users take for granted — features that Google has been more than happy to provide to iOS users by releasing apps like Google Maps and Google Search.
It looks as though Apple is on the right path. The new UI is clean and “flatter” (as rumored), but instead of the tile look used by Windows, iOS 7’s designers went with an overlay that gives an almost 3D appearance. And skeuomorphisms — like the much-derided green felt Game Center and leather and stitched Calendar — have been banished. The result is a minimalist, elegant interface.
It’s not all cosmetic, with major additions like a new Control Central that lets users access key controls with a swipe (instead of drilling through levels of Settings), multitasking support for all apps, intelligent background updating of apps (based on which apps you use most frequently and your network connection), an improved Safari web browser, filters for the camera, and Airdrop (a file sharing service). Siri gained an optional male voice, further support for in-car integration and, in a clear shot at Google, searches powered by Microsoft’s Bing search engine.
Another rumored product made its debut at WWDC. iTunes Radio is Apple’s answer to Pandora — a streaming Internet radio service with social hooks. It will be free to iTunes Match subscribers, with an ad-supported version available to everyone else. The company also announced iWorks for iCloud, basically an Apple version of Google Docs.
The stock market’s reaction to the WWDC keynote was muted; AAPL closed down 1.3% on Monday. Regardless of Wall Street’s relative indifference, though, Apple is showing that it’s willing to take aggressive action to hold (or regain, depending on your viewpoint) its position at the pinnacle of the smartphone heap. The other pieces of the equation will be the new iPhones and iPads expected in the fall — if the new hardware is up to snuff, then combined with iOS 7, it should address concerns that Apple is coasting in the mobile space.
Until then, it’s clear Apple intends to fight for sales in all its markets, upping the ante in its notebook line, showing a renewed interest in high-end workstation PCs and reinventing its mobile OS in an attempt to leapfrog the competition.
As of this writing, Brad Moon did not hold a position in any of the aforementioned securities.