If you’ve been reading my posts on this site for any length of time you’ll realize that I hold little of what analysts say in high regard. In fact, I spend a lot of my time moaning about how idiotic some of their predictions and expectations are. So, it may come as a surprise to hear that this most recent analysis is actually pretty dead-on (bar a few guesses at new hardware).
WWDC 2013 is going to kick off next Monday, and one analyst, Amit Daryanani from Capital Markets claims that investors’ expectations are “appropriately tempered”. As in – not expecting a huge deal. A fact which will almost certainly play in to Apple’s hands. AAPL stock prices generally fall when investors expect too much, only to be disappointed. If they’re not expecting much, Apple can do no wrong.
In regards to what we should expect, Daryanani repeats a lot of what we’ve already heard:
“Look for AAPL to overhaul iOS7 with an updated design overseen by Jony Ive. Notably, as it has been widely reported, the new iOS will have flatter icons and will move away from skewmorphism [sp] (digital interfaces that replicate the physical look). In addition, we expect enhancements to maps, iCloud and Siri, potentially enabling developers to leverage these offerings. With regards to iCloud, we would look for better management and transparency for users to see what they have stored in the cloud (specially via a mobile device). Overall, while we expect an aesthetic and visual overhaul of the UI (user interface), we don’t expect this to be a material EPS driver.”
He also comments on iRadio and its integration of iAd to ensure revenue:
“[iRadio] would launch AAPL into the streaming music industry and enable the company to leverage its “iAD” product to offer free (and premium) streaming radio service. While recent industry articles suggest AAPL is facing delays due to contract negotiations with content providers, we do think this launch could be one of the more interesting launches at WWDC. A successful streaming service would bring back the stickiness that AAPL’s ecosystem has lost given the launch of multiple third-party streaming music services.”
Again, it’s nothing we haven’t heard before. The rumors have been piling up, and those regarding iOS 7 have largely been repeated a lot and details of iRadio have been emerging for at least a year now. With record labels set to sign deals to allow Apple to stream content, it’s almost certain that iTunes will finally get its streaming service up and running.
After WWDC, the big news will come in the latter half of Q3. Like us, the analyst expects new hardware to land in the Fall. And – as mentioned earlier – it’s in the specifics of the new hardware launches that I find some unlikely candidates.
“In particular, we would not be surprised to see 1) Retina display iPad Mini; 2) iPad 10″ refresh; 3) iPhone Mini product line; 4) iPhone 5s; and 5) the release of one additional new hardware product line, likely an iTV or iWatch. In our view, this continues to be the main drag on the company’s stock as investors are eagerly awaiting new products and innovation from the tech giant.”
1) Probably; 2) Yes; 3) Doubtful; 4) Yes; 5) Not sure – any hard evidence of an iWatch or iTV being made is yet to surface. There have been no leaks, no components showing up or anything other than Apple’s CEO hinting that they’re working on it. I wouldn’t hold out for either device turning up this year.
So, in short: iOS 7 is the big talking point at WWDC 2013. There will be other smaller updates to some Macs, but like I mentioned in my “what to expect” article, the iPhone’s OS is going to be the main focus of next Monday’s keynote address.