By Adam Satariano - Oct 4, 2011 11:01 AM GMT+0700
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A man uses an Apple Inc. iPhone as he waits in line near the company's new store in Hong Kong. Voice technology is emerging as the latest arena for Apple’s rivalry with Google Inc. Photographer: Jerome Favre/Bloomberg
Oct. 4 (Bloomberg) -- James Gautrey, a technology specialist at Schroder Investment Management, talks about Apple Inc.'s next iPhone, due to be unveiled at an event today. He speaks with Owen Thomas on Bloomberg Television's "Countdown." (Source: Bloomberg)
Apple Inc. (AAPL)’s next iPhone, due to be unveiled at an event today, may be a showcase for improved voice controls, bringing phones closer to the realm of “Star Trek”- style speech recognition.
New voice commands will let users make appointments in their calendars, send text messages or e-mails, and surf the Web, said Gene Munster, an analyst at Piper Jaffray Cos. Apple already has basic voice-control abilities on the iPhone for placing a call or accessing a song. Today’s event is called “Let’s talk iPhone,” hinting at an expansion of the features.
Voice technology is emerging as the latest arena for Apple’s rivalry with Google Inc. (GOOG), which has spent years promoting speech technology. Current Google features transcribe voice messages to text and perform Web searches based on verbal commands. The challenge so far has been getting mainstream users to adopt the technology, said venture capitalist Larry Marcus, who has invested in speech-recognition company SoundHound Inc.
Apple can “make it exciting and make people think about it in different ways,” Marcus said. “Voice controls are a very fundamental way to interact with your device.”
Voice commands won’t be the only features added to the new iPhone. The device may include a better camera and a stronger processor to make programs run faster, people familiar with the matter said earlier this year. Apple showed off some of the new software for the device in June, including new messaging and notification features.
ICloud Approaches
The company also is readying iCloud, a service for storing files such as pictures and music on Apple’s remote servers so they can be accessed through iPhones, iPads and Mac computers.
Natalie Kerris, a spokeswoman for Cupertino, California- based Apple, declined to comment on today’s event.
The fifth-generation iPhone comes at a pivotal time for Apple. Today’s event will be the company’s first major product unveiling since co-founder Steve Jobs resigned as chief executive officer in August, when he turned the job over to longtime deputy Tim Cook.
The new speech technology would build on a service Apple introduced in 2009 called Voice Control, which lets users make a call or play music by speaking into the phone. Those features haven’t taken off, Marcus said.
“They have probably been taking extra time to figure out how to get it right,” he said.
Nuance Software
Speech-recognition technology also is available from companies such as Nuance Communications Inc. (NUAN), which offers voice-to-text transcription software. Automakers are adding speech features as well, letting drivers make a call or choose a song while keeping their hands on the wheel.
Mobile devices represent a growth market for voice-command technology as people try to perform more complex computing tasks on the go. Features will increasingly blend vocal and physical commands, said John Donovan, chief technology officer of AT&T Inc. (T), a carrier for the iPhone.
“Certain things are more naturally spoken, some things are more naturally typed, and some things are more naturally swiped,” he said, referring to the swiping motion that iPhone users make on the device’s touch screen. While declining to talk about Apple specifically, he said a big product event can “accelerate” adoption.
Apple acquired a speech-recognition software company last year called Siri, which lets users make restaurant reservations or search for a flight with voice commands. Apple also is probably working with Nuance to power the voice capabilities of the new iPhone, said Mike Phillips, chief technology officer and co-founder of Vlingo, which also makes voice-recognition technology.
How Far?
The move is good for the whole market, Phillips said. “The question is: How much farther do they go?” he said. “Do they really try to transform the search experience?”
That would mean making voice a main method of searching, rather than a once-in-a-while method, Phillips said.
Apple also is facing mounting competition in touch-screen smartphones -- a market it pioneered. Samsung Electronics Co. and HTC Corp. are relying on Google’s Android software to woo iPhone users. And Google is acquiring its own mobile-phone company, Motorola Mobility Holdings Inc., for $12.5 billion.
The Apple-Google rivalry has expanded to the courtroom, where Apple and Android adherents are suing each other for patent infringements.
Smartphone Showdown
At stake is leadership in the market for smartphones, which is projected to double by 2015, when 1 billion of the handsets will be sold, according to research firm IDC. While Apple is the single biggest smartphone maker, the Android coalition leads the market, accounting for 41.7 percent.
The iPhone is Apple’s top-selling product, generating almost half its sales last quarter. The company hasn’t released a new model since June 2010, so there may be pent-up demand for an update. Apple will sell a record 25 million iPhones during the December quarter, Piper Jaffray’s Munster estimates.
The success of the product has helped Apple’s stock weather market turmoil and the loss of its CEO. Shares of Apple, the world’s most valuable company, have climbed 16 percent this year. The stock fell $6.72 to $374.60 in yesterday’s trading on the Nasdaq Stock Market.
Even so, the long delay between new iPhones has put pressure on Apple to ward off competitors, said Ramon Llamas, an analyst with Framingham, Massachusetts-based IDC.
“It’s critical they have an iPhone coming out every single year,” he said. The 16-month lag “left the door open for some other competitors to jump in.”
To contact the reporter on this story: Adam Satariano in San Francisco at asatariano1@bloomberg.net
To contact the editors responsible for this story: Tom Giles at tgiles5@bloomberg.net
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