Apple Puts Gadgets in the Driver's Seat

Apple (Nasdaq; AAPL) trotted out updates for the software and hardware that will be in consumers' hands as early as this fall at its Worldwide Developers Conference this week. The annual conference typically gives some perspective on where the company is headed. But this time, there was no blockbuster news, and investors reacted cooly. Apple shares closed at $571.17 after the news on Monday, down from last Friday's close of $580.32

Perhaps if the company had announced a shiny, all-new iPhone, investors might have gone on a feeding frenzy. However, amid the new MacBook tweaks and a new desktop operating system, there were a few other points worth noting.

Siri, the voice-activated personal assistant integrated into the iPhone 4S and iPad, has been upgraded to let users launch apps as well as update Facebook (Nasdaq: FB) and Twitter by speaking out loud. Further, Apple plans to introduce an Eyes Free mode for Siri that would let users take control of their iPhones through voice controls only.

Siri and its Eyes Free system will also be integrated, when used with iOS mobile devices, into certain cars. Eyes Free will let users compose and hear text messages and make calls just by saying so. In theory that would help keep drivers focused on the road rather than fumbling with their iPhones.

Car makers who plan to integrate Eyes Free include Toyota (NYSE:TM), General Motors (NYSE: GM), BMW (GR: BMW), and Chrysler.

"That's part of building up the ecosystem," says Stephen Baker, vice president of industry analysis with market research firm NPD Group. "When you have high presence in a very large install base, you have the opportunity to jump into adjacent product categories."

He says Apple, dating back to the iPod, has been building on the trend of putting devices in cars. "Voice, over time, is going to be incredibly important in car electronics. Safety issues demand that everybody looks at different usage methodology than touch screens while operating cars."

Geography has also become more significant for Apple with a new map app that includes audible driving directions and a 3D view feature. The map app also includes search info such as Yelp (NYSE: YELP) ratings and reviews of local businesses. This native app will replace Google Maps on Apple's mobile devices. That may sound like competition for Google (Nasdaq: GOOG), but it may be a little early to draw battle lines.

Baker believes a head-to-head comparison of a new product with a veteran platform is not warranted. "You've got to start somewhere. There's always a gradual build of technology."

The fight is intensifying, however, where mobile devices and computers intersect. Baker says while Microsoft (Nasdaq: MSFT), to some extent, wants to differentiate the desktop and tablet experience of Windows 8 from smartphone platforms, Apple aims to make iPad and iPhone environments more comparable while maintaining some distinctiveness from desktops. "A big reason for that is looking to your strengths. If you're Apple you're going to lead with iOS because iPhone and the iPad are your strong, flagship products."

The influence of mobile devices is hard to ignore though, as desktop computers evolve. "They're clearly moving to bring more of the iOS [mobile] mentality into the desktop operating system," Baker says. "However they are going to make sure they are clearly defined as different products."