Apple Upgrades Offerings In Push Beyond the iPhone

"Apple Inc. introduced software changes Monday that aim to further expand its reach beyond the iPhone, including by boosting its payment system and car connectivity.

The tech giant used the kickoff Monday of its annual Worldwide Developers Conference to preview upcoming changes to its software for laptops, smartphones and tablets. It was a mix of morale booster for third-party developers that help fuel the digital ecosystem for its devices and an opportunity to preview how its own software will change later this year when officially rolled out.

Apple unveiled a buy-now-pay-later feature integrated into its Apple Pay offering and the promise of expanding CarPlay into more functions of the car.

Other changes revealed on Monday aimed at improving favorite Apple offerings. Software changes will allow the higher-end iPad to better multitask among different apps, introduce edit and recall abilities to iMessage and enable iPhones to automatically be used as web cameras with their Apple computers, which have lesser-quality cameras.

After years of introducing new privacy and security features, Apple announced the so-called Passkey that will use its Touch ID and Face ID to create biometric verification for websites and apps.

The hardware highlight came with the debut of Apple's second generation of its in-house silicon dubbed M2, announcing the chip to be used first in a new MacBook Air and 13-inch MacBook Pro that the company says will be faster and more efficient than previous versions. The completely redesigned 13.6-inch-screen MacBook Air laptop has a sharper edged look more in line with the newest iPhones and an improved camera. The Air will begin at $1,199 and goes on sale next month.

By its very nature, the event, known as WWDC, never commands as much attention as an iPhone unveiling, yet the new software features and policies can have far-reaching effects.

Monday's keynote is the highest-profile event of the weeklong event for developers, held mostly online, via the company's website and including 175 sessions. Apple had invited several hundred people to participate in person at its headquarters in Cupertino, Calif., where they had to meet certain conditions around vaccinations and testing.

Before turning to a pre-recorded presentation, Chief Executive Tim Cook greeted the crowd gathered outside in person: "It's so wonderful to see you all in person."

Two years ago, as the global pandemic was shutting down daily life for many, Apple helped set the tone for virtual events around the world as it transitioned its large-scale convention-center event to a virtual one. The company served as an example to other companies and organizations taking their first steps into the new world of remote events.

The pandemic helped fuel record profit for Apple as workers and students bought laptops, iPhones and tablets to augment their quarantine experience. The company's first iPhone with 5G cellular-data capability generated record sales of $191 billion in the past fiscal year, which ended in September.

Hurt by parts shortages and factory shutdowns in China related to Covid safety precautions, iPhone sales are expected to be stagnant this quarter compared with a year earlier. In total, analysts surveyed by FactSet on average predict iPhone revenue to rise 6.2% this fiscal year, after climbing 39% in 2021.

Apple's biggest area of growth this year is expected to come from the services category, which includes money generated from the App Store and Apple's ad business. Services sales might rise nearly 17% to $80 billion. That would be more than the combined sales of iPad and Mac computers, and rank second to Apple's iPhone business.

Those close Apple watchers looking for any hints regarding the company's planned extended-reality headset were left disappointed. As expected, no plans were revealed. Production of the device is expected to begin later this year or early next year, and would bring about Apple's most highly anticipated new product since the introduction of the Apple Watch in the fall of 2014.

Apple's entry into buy-now-pay-later is likely to stir greater competition. The market for such services has exploded in recent years. The top five app providers downloaded through Apple's App Store and Alphabet Inc.'s Google Play Store, including Affirm and Klarna, collectively had an estimated 7.5 million monthly active users in May, a 44% increase from a year ago, according to researcher Sensor Tower. Shares of Affirm Holdings Inc., a platform that offers installment payment plans for consumer purchases, fell 5.5% Monday after Apple's announcement.

Apple Pay Later will be available wherever Apple Pay is accepted online or in-app using the Mastercard network. Users will be able to split the cost of a purchase into four equal payments spread over six weeks without interest or fees, the company said.

Other changes to Apple Pay included allowing merchants to take payment between iPhone taps.

Apple's car ambitions were also on display Monday. The company said it is working with car makers, including Ford Motor Co. and Honda Motor Co., to expand capabilities of its CarPlay, which connects users' iPhones to their vehicles' dashboards. The updated system would allow Apple's system to become involved in some traditionally core features not touched by third-party systems, such as the instrument cluster behind the wheel.

Apple said CarPlay would be able to allow users to tune the radio and change the car temperature without leaving the interface -- aiming to resolve a longstanding complaint. Vehicles with the new connectivity will be announced late next year, Apple said." [1]

1. Apple Upgrades Offerings In Push Beyond the iPhone
Higgins, Tim. 
Wall Street Journal, Eastern edition; New York, N.Y. [New York, N.Y]. 07 June 2022: B.1.