Apple: Some Good, Some Bad

| About: Apple Inc. (AAPL)

Apple (NASDAQ:AAPL) had a field day with WWDC 2012. It unveiled quite a few novelties. Some were already expected, such as the MacBook Pro with Retina display. Some others, however, deserve some comments, both good and bad. Let us go through them:

Apple Maps

With iOS 6, Apple finally ditched Google (NASDAQ:GOOG) Maps for its in-house solution. This new app has a few useful aspects, like turn-by-turn navigation and Siri integration.

On the downside, Apple Maps still doesn't offer offline maps, something that Google has already introduced and Nokia (NYSE:NOK) Maps has had for a while. Offline maps is essential when you're navigating somewhere without data access, which isn't so rare in remote places. Apparently there's also no lane help - Nokia also has this feature, and it is critical for usage in dense cities.

On the plus side, Apple has integrated traffic information with Maps. It remains to be seen how this compares to other implementations of the same.

All in all, Apple Maps still remains inferior to other alternatives such as Google Maps or Nokia Maps. Offline navigation and lane help are simply too important to be compensated by other features including the Siri integration. Apple will have to get these features in the future. Obviously, the usefulness of this kind of feature can only be ascertained in practical usage.

Siri gets more capabilities and goes into the New iPad

Siri's capabilities were extended, for instance by integrating with Apple Maps, as well as Facebook, the new Passbook, etc. Siri also becomes available in the new iPad.

Mistreatment of iPad 2 users

This is related to Siri. The iPad 2 has hardware comparable to the iPhone 4S, yet with iOS 6 Apple has chosen not to grave the iPad 2 with Siri integration. This was left only for the iPhone 4S and the New iPad. Clearly, this decision was informed only by commercial interests. The application was not left out of the iPad 2 because of any hardware limitation; it was intentionally left out by choice. It's not the first time Apple has done this, and by doing it repeatedly it runs the risk its customers will at some point react to the intentional mistreatment to try and drive them to upgrade.

Mistreatment of iPhone 4 users

Turn-by-turn navigation - something available from vendors like Nokia for 5 years or more, will only be available for iPhone 4S, iPad 2 and the New iPad. Again, this seems a move designed to force upgrades, and not because of any catastrophic hardware limitation. This pattern, if repeated, might at some point alienate Apple's customers.

A subdued functionality, which might be the most relevant

It was not the most hyped functionality, but over time and if done right, it might become one of the most relevant for Apple. I am talking about Eyes Free, the Siri car integration. Apple instantly lined up a throng of partners, including BMW, GM, Mercedes, Land Rover, Jaguar, Audi, Toyota, Chrysler and Honda. This can be very, very relevant for Apple. If the cars get built integrating an easy link to Apple's products but not its rivals, this might lock in customers to the Apple ecosystem much more rigidly.

If this would happen this way, it would be a major positive for Apple.


Most of the novelties that Apple presented were expected. There are two large positives to be taken from this presentation

  • One is that Apple continues to transmit the image that it's leading in functionality, even in the instances where it's just catching up with an inferior alternative, like with Apple Maps;
  • The other is that Apple continues to find ways to make its ecosystem more and more difficult to avoid. It continues to find ways to lock in its customers. Such is the effect that one would expect from something like the Eyes Free functionality.

There is, in my view, one negative to be taken from the presentation. Apple is being too obvious in keeping its own customers away from developments which its Apple hardware limitations cannot justify, just to force upgrades. Such is the case with the iPhone 4 not getting turn-by-turn navigation and with the iPad 2 not getting Siri. This might, in time, lead to customer backlash, especially since the same practice does not exist with either the Google Android ecosystem or with Microsoft Windows Phone as seen in Nokia devices.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.