- The September 9th event has a lot riding on it.
- Generally speaking, investors shouldn't anticipate a new product category.
- Instead, investors should anticipate modest improvements to the various product families with some overview of the software
- Emphasis will be placed on this year's iPhone and iPad demonstration, as sustaining sales growth is highly dependent on the level of hype and excitement the event can generate.
- Furthermore, Apple might host another miniature music concert similar to WWDC 2015.
There has been a lot of speculation over Apple’s (NASDAQ:AAPL) September 9 event. But, to quickly dispel much of the hype, I’m going to start by mentioning that there’s an extremely low likelihood of new product announcements at the upcoming event. Apple typically releases new categories in a 5 to 6 year cycle, and only makes preliminary announcements within a year of an actual product launch. Neither the Apple Car, nor a VR headset are in store at the event, and while I think Apple could be disruptive in the two product categories, the real incentive to expand the venue size is driven by the amount of free promotional activity Apple receives from various media agencies across the globe.
In fact, Apple is more of an international company now, so the ability to scale venue size to 7,000 seats reflects the need to accommodate for both domestic and foreign journalists wanting to cover the event rather than the need to expand seating to support a new product announcement.
what should investors expect from Apple's September 9th event?
The iPhone 6S is definitely a certainty. The naming cadence will continue, and Apple will put added attention and detail into explaining the performance advantages of this year’s model, as they’re trying to sustain the shipment ramp for the iPhone segment. Furthermore, rumors point to a force touch-sensitive iPhone, which creates a richer app-developer environment around a mature product category. It could be the right-click button equivalent for smartphones, which is why the presentation will explain in great detail the additional feature, sort of like a tutorial on the new touch capabilities. This event is one of the few opportunities in which Apple gets to educate consumers, so it’s not going to squander the opportunity.
Second, the iPad is long due for a bigger brother equivalent. The iPad Pro could be announced at this year's event, as Apple has been struggling to generate growth in the segment, so the ability to showcase multi-tasking with force touch on a bigger screen will occupy a large segment of the presentation.
They will then go onto other improvements they had made to the OS-layer prior to the formal release of iOS 9. The keynote will probably rehash much of the commentary that was shared at WWDC 2015, and will include any additional comments on last-minute changes prior to a more formal launch. That being the case, investors will find this part of the presentation important, but more of a recap.
Apple will announce a new Apple TV, and again, there’s been a lot of speculation on the price point and features. But, I can guarantee you that Apple is not going to compete with console manufacturers, because it’s not very profitable, and developing a platform that can scale into gaming requires a large base of enthusiast gamers. Something Apple doesn’t have. It does have a large platform dedicated to casual mobile gamers, and there might be integration of mobile gaming on the Apple TV, but I’m highly skeptical given the rather uninspiring simplicity of the Apple TV remote.
The Mac segment will showcase a 15-inch MacBook Pro Model with force touch, and improved internal components. It’s likely that the MacBook and iMac line-up will be refreshed with Intel Skylake parts, which Apple will briefly summarize as a 30% improvement in performance. Apple will then explain the performance gains of OS X El Capitan, and the added multi-tasking functionalities, before moving onto the next part of their presentation.
The Apple Watch 2 might be demonstrated at the event, I’m not exactly certain, because it’s a rather quick refresh to a pre-existing product line-up, and it may create pent-up demand for the device, which will diminish demand for the first generation device. On the other hand, Apple had a formal demonstration of the Apple Watch at last years September 9th event without any intention of releasing the product until Q1 2015, which then got delayed to Q2 2015 in limited quantities.
To best orchestrate how they’ve come further ahead of competing OEMs, they will brag about sales figures, and the unique use cases they have developed. It will be interesting to see if Apple can offer more capabilities in Watch OS 2, or if they’ll briefly summarize the comments they had made at WWDC 2015. In either case, the Apple Watch presentation is going to be one of the longer segments, as the company needs to persuade consumers of it being more than just an “extra screen.”
Some unanticipated things could occur at this year’s event. With the venue being larger, they might bring on a group of music artists and run a full-blown concert to kick-start the product demonstration. After all, Apple is also a music company, and while it no longer represents a significant mix of the current revenue, the company needs to demonstrate credibility with the music community. With 7,000 event participants, it’s going to be interesting to gauge the level of excitement from a miniature music concert.
I don’t anticipate much from Apple Music at the event other than a brief summary on Apple Music statistics. The event will be extremely long, so other products will take much higher priority.
Apple's September 9th event this year will be exciting, and unlike prior years where the stock responded negatively, I anticipate the stock will get a bit of a lift, as the sentiment around the stock is weak. There will be much more commentary pertaining to China, which will reassure shareholders.
There’s a lot riding on this event, so Apple will need to demonstrate twice the showmanship from prior years. I think Apple already knows this, which is why they invested weeks and millions of dollars into San Francisco’s Bill Graham Civic Auditorium. It’s a different venue from prior years, but “Think Different” still lives on.