Apple's Next 'Wild Card' May Not Be What You Think The tech company's big announcement at its developer's conference next week may not be what you're expecting.
This story originally appeared on CNBC
There's been a lot of noise that Apple's "surprise" announcement at its World Wide Developers' Conference (WWDC13) next week will be the launch of a music-streaming service. But the iPhone maker may have something else up its sleeve.
"The wild card -- because there is always a wild card at an Apple event -- could be they are opening up their apps platform for Apple TV," said Gene Munster, analyst at Piper Jaffray. "As it stands, you have to be invited by Apple to develop, so the idea to open it up would be something that is pretty meaningful."
Peter Misek, managing director and tech analyst for Jefferies & Co., told CNBC in February that he anticipated Apple's opening up the platform to developers to build apps and games, but he predicted the announcement would come in March.
"We think there is a huge developer opportunity in the living room, utilizing the existing Apple TV set-top box, which may or may not be in advance of an actual television," Misek told CNBC in February. "We think developers are clamoring for an opportunity to get access to that."
Currently, the Apple TV -- a digital media device that enables you to stream content to a TV set -- has 10 apps, but more are said to be on the way, including one for HBO and CW. Time Warner Cable is also looking to get an app on the Apple TV platform, according to reports.
Despite speculation about apps, though, Apple is going to unveil a television soon, and an app push would be a good foundation for its launch, according to Munster.
"Opening up the platform for all developers would get more people thinking about the TV," he said.
Munster, who has a price target of $655 with an overweight rating, said he expects Apple eventually to introduce a music-streaming service but isn't sure it will happen at WWDC2013.
Services such as music-streaming will become more important to Apple to generate revenue as replacement cycles get longer, said Carolina Milanesi, research vice president for consumer technologies at Gartner.
Because consumers rely on software for updates, they won't be replacing devices as frequently, she said, adding that she could envision a roll-out of a music-streaming service at the conference.
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"It seems to make sense, but people have been speculating that for a long time, Milanesi said. "If they don't, they would begin to stick out as the only player who doesn't have anything. It's probably about time they do something there," Milanesi said. "Maybe they would have an option of a basic service that is free with ads and a premium [paid] service, but I would expect them to monetize directly from the service."
Certainly, Apple is late to the music-streaming game. Google launched a subscription service last month at its developers conference, and other names in the category include Pandora and Spotify. But Apple does have something those companies don't: 500 million iTune accounts.
According to a note released earlier this week from Katy Huberty, an analyst for Morgan Stanley, Apple could make $1 billion a year from a music-streaming service. Her figures include both a subscription fee and display advertising dollars, but exclude audio advertising.
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Huberty, who has an overweight rating and a price target of $540, notes that it's still too early to know how many people would adopt an Apple music streaming as many have already chosen one from a competitors.
"Apple's streaming music service would have to compete with Pandora in the U.S., where many Apple users have already invested at least some effort in building out their musical preferences in Pandora," she said. "Since we do not know exactly how Apple will differentiate their service, we conservatively assume 40 percent to 50 percent penetration."
