Expectations were running high from both investors and consumers heading into today's annual Apple (AAPL) Worldwide Developers Conference, but as we have grown accustomed to since the passing of Steve Jobs, the company underwhelmed with today's event.
The tech giant has recently come under heavy criticism, with business pundits claiming that Apple (AAPL) has lost its “innovative edge” and investors expressing their displeasure by piling out of the stock. From 52-week highs to 52-week lows, AAPL sold off nearly 40%. Before the conference, speculation grew louder that Apple could recapture some of its old magic by announcing a groundbreaking product, such as a new Apple-branded TV or the release of an exciting new music streaming service. However, Apple has seemingly laid another proverbial egg.
The conference began with the introduction of Apple’s new operating system, Mac OS X Mavericks. “OS X Mavericks is our best version yet" raved Apple’s vice president of software, Craig Federighi. Although the layout of the operating system remained relatively similar, Mac OS X Mavericks concentrates on improving user responsiveness and extending battery life for the Macbook Air and Macbook Pro. Apps such as Safari, Maps, and iBooks also received small modifications, all with the intent to create a smoother browsing experience.
Marketing Chief Phil Schiller then took the stage to introduce the new model of Macbook Air. This new model has an extended battery life of 9 hours and a $100 price reduction from previous models. Although improved battery life plays a major role in consumer satisfaction, many tech bloggers opined the new model Macbook Air seemed like a revamped version of its predecessors.
The main event of the conference came at the announcement of the new iOS 7 for the both iPhone and iPad. This was Apple’s move to regain that innovative edge that has become a part of it’s culture. The new mobile operating system received a complete face lift, with CEO Tim Cook calling it the "the biggest change to iOS since the introduction of iOS.” Investors did not seem quite as impressed with the new software.
Speculation had grown in recent months that Apple could introduce a streaming music service, and they did deliver on that front, much to the delight of the crowd in attendance. After Apple was finally able to secure deals with record giants Sony, Universal and Warner, the public finally received a view of what the Pandora (P)-like service will look like. The music service functions much like Pandora, with text and audio ads supporting the free service, and also provides a link to purchase a song on iTunes.
AAPL took a dive as the conference wore on, declining $6.80 to $440.10, down from its pre-conference price of $446.90. Pandora (P) share prices actually rose $0.35 on the day despite the potential new competition. From a technical standpoint, AAPL should have violated upper level stops on short-term long trading positions when it traded below $444-446.
*DISCLOSURES: No relevant positions