WWDC: Apple Music, iOS 9, And More Expected

WWDC: Apple Music, iOS 9, And More Expected
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Apple kicks off this year’s Worldwide Developers Conference (WWDC) with the keynote speech (here’s how to watch it) at 10 a.m. Pacific (1 p.m. Eastern). A smorgasbord of items is expected to be on the agenda, including a streaming music service, iOS 9 and others.

Apple Music expected at WWDC but not Apple TV

Cantor Fitzgerald analysts Brian White and Isabel Zhu provided a preview of today’s keynote at WWDC. The introduction of a streaming music service is considered by most to be a given. However, just last week it was reported that Apple was still having difficulties nailing down concrete deals with the biggest record labels. It would seem that the company would have to finish the negotiations prior to announcing the service, but perhaps not.

White and Zhu agree with others that a streaming music service will probably be in today’s keynote. They note the bevy of media reports suggesting this. Apple would leverage the $3 billion acquisition of Beats last year, combining it with its long-running success in iTunes. Apple is expected to charge $10 per month for the streaming music service.

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However, they think the rumored streaming TV service could be pushed back to fall. That suggestion is in line with a report from Bloomberg this morning which also indicated that the TV service will probably come later. It’s also in line with similar reports from last week and before that which suggested that negotiations with TV content providers have stalled.

Other updates expected at WWDC

Apple uses WWDC to introduce the newest versions of its operating systems every year, and this year is expected to be no different. iOS 9 and the newest version of OS X are expected. The Cantor Fitzgerald team expects iOS 9 will be all about improving the experience of users instead of major aesthetic changes. They also expect fewer new features this year as compared to the last couple of years. They’re expecting a similar story with OS X.

In addition to the new operating systems, the analysts also expect updates on the Apple Watch, including a roadmap for the introduction of native apps. Further, they’re looking for updates on Apple Pay, CarPlay, HealthKit and HomeKit.

Apple still expanding its ecosystem

The Cantor Fitzgerald team notes that WWDC is typically about software rather than hardware, so anything that’s unveiled will be less about sales and more about expanding iOS and making it stickier for users. They think Apple Music will be more of a support for the stickiness of the iOS ecosystem rather than a needle-mover for the company’s revenue.

The analysts believe that investors don’t fully appreciate Apple’s ecosystem because it works behind the scenes to support the company’s devices. They note, however, that the company continues to expand its reach into wearables, smart homes, connected cars and other areas of technology. They believe Apple’s reach into such a wide variety of areas differentiates the company from its competitors. Further, they think that as the years go by, Apple will leave more of its competitors in the dust. They call Apple’s software, services and devices “the most powerful digital ecosystem in the mobile device world.”

Apple shares rose 0.05% to $128.72 per share shortly after the markets opened this morning.

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