Apple to overhaul its mobile operating system

Apple is preparing to unveil sweeping changes to the software powering iPhones and iPads, seeking to reignite desire for its products and blunt the advance of Google’s Android operating system.

Chief Executive Officer Tim Cook was to kick off Apple’s 24th annual developers conference in San Francisco yesterday by unveiling a new version of iOS with a simpler user interface that will scrap design features such as simulated paper and faux-wood bookshelves, according to people familiar with the plans.

The period since the iPad mini debuted in October marks one of Apple’s longest product gaps in more than a decade, coinciding with a 37 percent share slide from a record set the previous month.

The redesign of the software behind the devices that generate more than 70 percent of Apple’s sales is a crucial first step toward renewing consumers’ interest, according to Ben Reitzes, an analyst at Barclays in New York.

“Apple has been in a funk and this is an important event to highlight how they are innovating,” Reitzes said in an interview. “We need to see that next big innovation.”

With smartphones sharing many physical traits and technological features, device makers are relying more on software design and services to gain an edge and lure consumers.

As part of that, Apple will also unveil a music-streaming service, people familiar with the plans said last week. The feature won’t be available until iOS 7 is released later this year. Apple may also announce enhancements to its maps and Siri voice-recognition software.

While Cupertino, California-based Apple won’t be introducing a new iPhone or iPad, anticipation for the event has been building since Cook shuffled his lieutenants, putting head industrial designer Jonathan Ive in charge of the look and feel of Apple’s software. A longtime confidant of co-founder Steve Jobs and the draftsman behind the iPhone and Mac, Ive has been leading a remake of the iOS mobile software.

“Software design hasn’t been on the same level as industrial design,” said Mark Hall, chief executive officer of Remixation, maker of video-sharing app Showyou. “People see this as a chance for the software user interface to get on par with the device design.”

A lot is riding on whether those changes will prove to be a hit with buyers. Apple’s iOS accounted for 18 percent of global smartphone shipments in the first quarter, those running Android made up 74 percent, according to research-firm Gartner. IPhone sales climbed about 16 percent in the period, lagging behind the smartphone market which grew 43 percent.

Apple has traditionally previewed new iOS software at the conference and then released it to the public when a new iPhone is introduced later in the year. This week’s event, which costs $1,600 to attend, is geared toward application developers. As Google, Microsoft Corp. and Blackberry try to lure engineers to build for their systems, Apple is trying to maintain the loyalty of those who create games and applications.

Cook last month said the company would be giving developers more opportunities to add features that can be integrated into Apple’s operating systems.

“It used to be that people bought devices because of the hardware and how the phone looked and maybe what kind of camera it had,” said Charles Golvin, an analyst at Forrester Research Inc. in Cambridge, Massachusetts. “Now people’s loyalty is the larger ecosystem and the applications.”

In addition to developers, Apple also needs to add software and services to convince customers, along with wireless carriers that subsidize the iPhone, that the device’s ecosystem is still worth a premium compared with the cost of rival device, according to Barclays’s Reitzes.

Apple’s planned music-streaming service, similar to Pandora Media Inc.’s online-radio service, will be free and supported by advertising.

After Cook appointed Ive to rethink the mobile operating system, engineers have been racing to finish the software in time for today’s event. Ive took over the duties of former mobile-software chief Scott Forstall.

Bloomberg