Given that Apple is building a large structure outside of the Flint Center ahead of next week's event, perhaps they'll demo one or more devices that combine HomePlug AV2 (perhaps with some proprietary Apple wrapper protocol) and HomeKit home automation functionality. It would make sense that they'd want to showcase a "connected home" with simple devices that extended wired and wireless networks while letting users turn lights and other devices on an off wirelessly. The proliferation of wireless devices is placing an increasing strain on private, residential Wi-Fi, especially when wireless video and music streaming is involved. Powerline networking would help address this issue. The Airport Express, AppleTV, and Mac mini still haven't been updated to 802.11ac, and these devices are all designed to remain stationary (unlike iPads, iPhones, etc.), so perhaps Apple would focus on powerline vs. wireless networking for these, too?
As a brief follow up to my earlier iWatch/iTime speculation, what if the "fingerprint" or identification sensor is not on the face of the watch, but on the back of the watch or inside of the band? There have been multiple reports of iPhone 5S users enrolling areas of skin on their arms and even their cats' paws with Touch ID successfully, as demonstrated here. Since Touch ID sensors can authorize patches of skin other than just fingerprints, it's conceivable that Apple's wearable could do the same. By authorizing against the skin on the wrist, the watch could always know if it was being worn by its owner and could re-authorize its user whenever necessary without user intervention (to automate sign in for an iPhone/iPad/OS X system or to make a purchase). This could really accelerate retail checkout, and one of the things Apple would surely tout in appealing to retailers is how much faster purchase processing with their watch will be than with traditional credit cards.
Ahead of Amazon's likely announcement of a smartphone, there's been a lot of attention paid to the possibility that the phone will feature 3D user interface elements. While almost all "3D" display technology available at the moment is gimmickry, the possibility that the device will feature accurate focus and gaze tracking has serious implications for interface design.
Many modern digital cameras, including camera applications in many smartphones, have basic face detection, which enables cameras to attempt to auto-focus on human faces. There have been several demonstrations of using the front-facing camera on the iPhone, for example, to track a user's face and use these data to re-render "3D" scenes on screen or allow the user to control an application by moving his/her head relative to the iPhone's surface. These implementations are rudimentary and are limited by the relatively low resolution of modern smartphones' front-facing cameras. Separately, the autostereoscopic "3D" displays on the Nintendo 3DS and other devices like the HTC EVO 3D don't use cameras to track a user's perspective at all; the display technology in these devices create the illusion of depth by hiding alternate pixels on the screen from each of the viewer's eyes.
While these other examples of 3D technology have been confused in much coverage and online discussion, the evidence is that the core of what Amazon will be doing with its smartphone is completely different. At its core, the Amazon smartphone will likely employ accurate infrared gaze tracking. This can be used for "3D" rendering, but it can also be used for lots of other applications and hasn't been available in a major mainstream consumer electronics device before.
Compare the level of mental focus and attention required to move your head or hands around vs. moving your eyes. Most people don't even think about re-focusing their eyes or looking from one object to another. An interface where a user could stare at an icon to launch a program, read to the bottom of a page in an e-book and have the e-book's page turn automatically, or have a webpage similarly scroll automatically based on a user's progress reading the page's content would seem magical.
It will be interesting to see how sensitive and accurate Amazon's implementation of gaze tracking is and how it is integrated into the phone's interface. There are plenty of questions about battery life and other costs as well, but given the descriptions of infrared sensors in the device (coupled with the strong possibility that Amazon will subsidize the price of the phone and the data plan), it seems Amazon may be ready to shake up several industries more than many expect.
Over the past several days, Slashdot, T-Mobile, Oracle, and Apple have all had expired SSL certificates that have impacted services (several of these issues have since been fixed). Why are there so many synchronized, high-profile lapses? Is it just a coincidence, perhaps related to the Memorial Day holiday in the US, or is something going on? Was there some sale on certificates some time ago that caused all these companies to renew (and subsequently expire) their certs at the same time?
Ahead of WWDC 2014, here are some thoughts and speculation on Apple.
OS X Laptop Computer
11.88 Inch 2732x1536 264ppi display
ARM A8 CPU
FaceTime HD camera
802.11ac Wi-Fi networking
15+ hour battery
64GB - $799
128GB - $899
256GB - $999
64GB + Cellular - $929
128GB + Cellular - $1,029
256GB + Cellular - $1,129
OS X Desktop Computer
ARM A8 CPU
802.11ac Wi-Fi networking
64GB - $499
128GB - $599
256GB - $699
4.7 Inch 1334x750 326ppi display
ARM A8 CPU
802.11ac Wi-Fi networking
Touch ID Sensor
Health monitoring Lightning headphones
32GB - $299 on contract
64GB - $399 on contract
128GB - $499 on contract
The big change on the OS X side will be support for Apple's A8 ARM CPU, with new ARM-based OS X laptop and desktop systems. The ARM laptop will be positioned as the "lightest, lowest priced OS X notebook ever, with a beautiful Retina display and the best battery life of any Apple notebook." There will be options for cellular connectivity, which will differentiate the computer from existing MacBooks and other PC notebooks.
The ARM-based desktop picture is a bit murkier, but it's likely that Apple will replace the 18+ month old Mac mini. The 2012 Intel mini doesn't have 802.11ac and the standard configurations don't ship with flash memory, so Apple could advertise their inclusion in a new model as an upgrade.
The new iPhone will feature a bigger display and A8 CPU, but the key new features will be health monitoring headphones and NFC mobile payment. While mobile payment and health monitoring will also likely be included in the iWatch, along with identity and other features, Apple could announce basic health and payment functions at WWDC to introduce developers to the relevant APIs before the big iWatch debut. The inclusion of new headphone sensors will raise the price of the flagship iPhone, but Apple will lower prices on its remaining iPhone lineup to compensate.
Key Focus On Audio
There have been numerous reports regarding Apple's possible acquisition of Beats Electronics. Both companies have valuable branding: Apple makes large profits selling fashionable high end technology, while Beats profits selling fashionable, mediocre technology. In many cases, Beats headphones are the most expensive hardware accessories consumers purchase for their smartphones (iOS or Android). Apple knows that if it wants to get customers to use a new type of headphone, having Dr. Dre push Apple's new headphones as the trendiest, "best" headphones will go a long way towards getting Beats fans interested in Apple's kit.
Apple is likely planning a multi-faceted strategy to lock customers into its own audio ecosystem. This will involve the elimination of ubiquitous standards, such as the 3.5mm headphone jack, from Apple products. Apple will stress the thinness of new devices, like the iPhone, along with "high fidelity" audio delivery and health monitoring functions to push audio over Lightning and AirPlay. Apple will introduce new higher bitrate audio formats for the iTunes Store, and playing these new formats at their full bitrate will require new Apple devices. Apple will likely debut one or more new 802.11ac devices capable of playing the format; the Airport Express seems likely to receive an upgrade, as the current model does not include 802.11ac. However, Apple may have more elaborate plans to update/merge the Apple TV and Airport Express and/or debut new AirPlay target devices with integrated speakers.
Across its entire new product line, Apple will emphasize that its new Lightning audio standard will provide the "best" audio experience, from listening to high-bitrate content in iTunes on an ARM-based OS X computer, to watching movies on iPads, to making VoLTE calls on the new iPhone.
In this context, a Beats acquisition makes more sense. For customers whose loyalty to the highly-visible Beats headphones is greater than to Apple products, losing the ability to pair Beats with an iPhone would be ample cause for defection to Android. However, Apple could flip this around through a Beats acquisition and ensure that the only way to get the "best" Beats experience is to use the Lightning-enabled, Dr. Dre-endorsed headphones on Apple products.
Touch ID and NFC in the new iPhone and forthcoming iWatch will be the biggest windfall for Apple if they are successful. For consumers, Apple can emphasize convenience and security: don't carry a stealable credit card around to make payments, just use your thumbprint and don't trust some sketchy store's fingerprint scanner, use your own on your phone/watch. For businesses, Apple can leverage its huge bank of registered credit cards and established iTunes micro-payment infrastructure to lower credit card processing fees to merchants that accept their payment system.
In the long term, Apple could push this really far. They could intercept valuable transaction data to build up consumer profiles and gain commissions on a large number of their customers' transactions. Factor in the relative affluence of Apple customers and there's the potential for Apple to make a LOT of money off this.
While Apple will surely advertise that its new health-monitoring services in the iWatch and iPhone will improve and even save lives, there are huge opportunities to exploit health data to increase the efficacy of advertising. Apple could auction off advertising space based on both customers' known spending habits and their physical state at the moment of ad delivery. Imagine being able to deliver an ad knowing that someone is hungry, tired, or excited at a specific moment in time. This could be done subtly so that users wouldn't even notice that the ad for the candy bar they see on their computer screen is being delivered because their watch is telling Apple they're hungry.
While Apple will probably not announce or release all of its new products and services at WWDC, it's likely that they will methodically roll out many of these over the second half of this year.
If they do, this will be a critical juncture for Apple and its customers. There are clearly opportunities for Apple to introduce new technologies in more open ways: moving to ARM-based OS X does not require that Gatekeeper be permanently switched off, Intel has demonstrated that health-monitoring headphones can be driven via a standard 3.5mm headphone jack, and high-fidelity audio doesn't require a proprietary connection. However, over the years, Apple has moved towards more locked-down proprietary systems, from controlling its App Stores to Steve Jobs lying about making "FaceTime an open industry standard" in his July 2010 keynote. If Apple wanted to fully lock down its platforms, and there is every indication that's where they're headed, now would be a great time to do so.
Customers should be wary of an ecosystem where music they buy can't be played on systems or headphones of their choosing or where they can only get applications from a single source. However, it's clear that Apple's most locked-down devices, its iOS offerings, are its most profitable and consumers have been more than willing to surrender control and flexibility for perceived convenience. Apple could tout interoperability of Lightning peripherals between iOS and OS X devices and the timing is right to ditch ubiquitous standards like USB and analog audio since all applications and drivers would have to be rebuilt anyway for OS X on ARM.
If this happens, Apple stands to make or lose a fortune as it attempts to isolate its customers from other companies. Given how things have played out so far, Apple's success seems inevitable.
On Apple's January 2013 quarterly earnings call, CEO Tim Cook stated, regarding âoeâ¦somebody who buys an iPad mini or an iPad [as] â¦their first Apple product, we had great experience through the years of knowing that when somebody buys their first Apple product, that a percentage of these people wind up buying another type of Apple product. And so, if you remember, what we had termed the halo effect for some time with the iPod with the Mac, we're very confident that that will happen and we're seeing some evidence of that on the iPad as well. And so, I see cannibalization as a huge opportunity.â
In September of that year, Apple announced a new 64-bit A7 processor, which was introduced in the iPhone 5S and was subsequently included in the iPad Air and iPad mini with Retina display that debuted the following month. Apple's public relations copy consistently touted the A7 as a âoedesktop-class architecture.â
Beginning with the A4 processor in 2010, Apple has released a new custom ARM-series CPU each year in its flagship iPhone and Cook has repeatedly indicated that Apple is working on new product categories that will be available in 2014. While there is a lot of warranted speculation around payment processing, wearables, and television products, which Apple is certainly pursuing, there are indications that Apple may be planning to dramatically shake up its Macintosh computer lineup as well, perhaps by building new OS X devices around its custom ARM-based silicon vs. Intel's CPUs.
Apple is facing threats on multiple fronts in the sub-$1,000 computing marketplace. There are now many competing computing devices available in this space, and there are indications that Apple's iPad sales are slowing as alternative devices, many with lower price points, attract potential customers and existing iPad owners remain complacent and uninterested in rapid upgrade cycles. Despite Apple's clever marketing and the best efforts of many third parties to augment the device's limitations, the iPad was designed first and foremost as a media delivery vs. general computing device. While this led to a streamlined interface with a high degree of ease-of-use, this design is turning into a liability, as it becomes more difficult for existing iPad customers to perceive any advantage in the purchase of a newer model.
Apple knows that while its iOS users have the highest level of customer satisfaction in the mobile industry (70%+ for iOS vs. under 60% for Android and all other competitors), many of these customers remain frustrated with their general computing devices. The problem is that while many prospective customers might be attracted to OS X devices, they're put off by the high price of entry. The cheapest OS X notebook is $1,000, while competing devices begin under $300. Additionally, the lowest-priced OS X system, the Mac mini, starts at $600, requires significant additions for most users (monitor, keyboard, mouse), and has low enough margins that Apple typically excludes it from its employee discount program and other promotions.
While this is purely speculative, Apple could release sub-$1,000 OS X devices running on ARM CPUs in the near future. In particular, an A8-based Mac mini replacement and A8-based notebook seem like a good fit and would bring Apple several advantages.
First, Apple would control its own CPU design for all of its sub-$1,000 products in this scenario. The Apple TV (if it continues in its current incarnation), iPod, Mac mini, iPad, iPhone, and ARM-based notebook would all be based on the same CPU architecture. This would reduce Apple's dependence on Intel.
Second, while recompiling OS X and its own related applications for ARM would be straightforward for Apple, all third-party applications would also need to be rebuilt for the architecture, and Apple could leverage Gatekeeper and the OS X App Store to control distribution of third party software and gain commissions on third party software sales and subscriptions. Customers on the whole wouldn't care about losing the ability to sideload; iOS users would be accustomed to the App Store model, wouldn't have an existing library of OS X software if they're moving from Windows, and would be exuberant about sub-$1,000 Apple notebooks.
Because even the most optimistic projections for the processing capabilities of the A8 wouldn't put it in the same league as higher-end Intel processors and existing OS X users may still want the degree of flexibility the Intel architecture affords, Apple could continue selling Intel-based OS X systems above the $1,000 threshold. The only immediate loss to customers would be the Intel-based Mac mini, but Apple could easily downplay that, as the system hasn't been updated since 2012.
The timing for ARM-based OS X seems ideal. The existing A7 is already a capable processor, and the A8 will likely be even more so. Intel has achieved amazing things with its Haswell CPUs, and many powerful competing devices based on the architecture are available that threaten to lure users away from Apple. The previous power consumption advantages of ARM over x86 are dwindling given Intel's remarkable improvements, so this is one of the last opportunities Apple will have to distinguish battery life advantages of ARM, before Intel's 14 nanometer die shrink in 2015.
The fact that the iPad mini jumped several CPU generations in moving from an A5 to an A7 in the Retina iPad mini last year is further evidence that Apple wants to consolidate its architectures for the long-term, especially since Apple must have known that such a significant CPU upgrade is lost on the average consumer. As Apple converts more of its devices to 64-bit ARM, it can simplify development tools and gradually push ARM CPUs up the product line as the architecture becomes more powerful and third party applications become more available.
Earlier this year, Apple's Senior Vice President of Worldwide Product Marketing Phil Schiller and Senior Vice President of Software Engineering Craig Federighi adamantly professed that working on merging iOS and OS X would be a âoewaste of energyâ and is a âoenon-goal.â While this is true, it's not just for the user experience rationale Apple usually puts forward. Apple is much more deceptive than it lets on: it knows that people want both touch and keyboard + mouse interfaces, but why sell each customer one device when you can sell two?
Apple's switching OS X to ARM will have lots of implications, including the possible loss of Boot Camp and Thunderbolt on non-Intel systems. Apple will stress cost, battery life, theft prevention through Activation Lock, and many other benefits to customers for newer ARM-based OS X systems, and some of these will be real advantages. However, if the above predictions materialize, particularly locking out alternative operating systems and software distributed outside the curated App Store, Apple's removal of the user-accessible Gatekeeper switch wouldn't be about improving security or software quality, it would be exclusively about breaking the 30 year legacy of the Mac as a flexible computing platform so that Apple can enforce totalitarian control over the platform at the expense of its users.
Consumers and the press should be on alert and should look critically upon such a development, but a shiny $700 Apple notebook with 24-hour battery life might prove too appealing for people to care.
Here's what I'm thinking/guessing about Apple's iWatch:
The iWatch will be about health, identity, and mobile payment.
Apple's recent design language suggests a circular form that would take cues from traditional clock geometry. The Mac Pro, the fingerprint reader on the front of the iPhone 5S, and the circular cutouts on the back of the iPhone 5C case all anticipate a rounded watch face.
Take a stack of 3 US quarters and round off the top edge like the top of the Mac Pro cylinder and that's the basic shape. Cut two parallel lines through the middle quarter, splitting it into three pieces, then throw out the middle piece and sandwich the remaining two pieces back between the upper and lower quarters to form a conduit through which
interchangeable watchbands can pass. This design would also allow sensors to remain in contact with the skin on either side of the watch band, if necessary.
The face of the watch would have a fingerprint reader, perhaps as a ring around the watch face, and the edges of the watch body could be capacitive touch areas that would provide a dial-like interface. Wearers could navigate by pinching either side of the watch between the thumb and index finger of the opposite hand and rotating around the watch face. This sort of twisting swipe gesture around the watch face would allow the viewer to see the watch face while navigating. It may also be possible to perform gestures by swiping along the watch band. Sapphire seems like an obvious choice for the screen surface given its durability and Apple's investment in the material.
The band would likely have integrated sensors that would detect when the watch is unfastened/removed from the wrist. Other health monitoring sensors and perhaps touch/swipe sensors could also be integrated.
The watch face would likely be circular and include a basic touch screen and fingerprint sensor. Wearers would not swipe the screen directly for most navigation as this would occlude the screen, but could tap on the screen or scan a fingerprint to confirm a selection or identify themselves.
Overall, I expect the device to have more in common with a Braun BN0021BKBKG than a Pebble.
Apple wants to distinguish the iWatch from other smart watches and wearable technology like Google Glass. Designing a smart watch with a classic form that looks more like a traditional watch would be consistent with Apple's general minimal industrial aesthetic and would help the Apple brand considerably. I can see Schiller and Cook talking about technology that gets out of the way and poking fun at wearable computing that expects you to strap a computer to your face.
Of course, Apple would want to accessorize and monetize the heck out of this thing. That means interchangeable, multi-color watch bands and premium leather options. By including proprietary sensors in the band, Apple can control (or exclude) third-party vendors that might make alternative watch straps. The band's sensors could interface with the watch body through a connector hidden inside the watch body, which the band would pass through.
If they wanted to differentiate a premium model from other options, they could include the fingerprint sensor and/or charging options on higher-end models.
The key limitations will be miniaturization and battery life. Apple will limit the watch's functions as much as possible to conserve battery life and provide an upgrade path for future models. In a tiny device, it simply isn't possible to include audio or video playback and hit battery life targets at this point. I don't expect any Siri functionality and only limited notifications and status updates are likely. Apple will steer clear of the pitfalls that brought down the Jack-of-all-trades Galaxy Gear and focus on executing a small but important set of core functions well.
Beginning with health, the first generation iWatch will likely have the most compromises in this area. Apple will likely focus on simple Quantified Self (QS) functions like counting calories burned and general activity level. They certainly want to encourage owners to wear the device as much as possible, but battery recharging may limit the ability to monitor sleep. The two obvious opportunities for plug-in or induction charging are overnight or during bathing.
If they could, I'm sure Apple would prefer to create a "self-winding" iWatch that would capture energy from natural arm motion to power the watch. This would encourage users to never take the watch off. Given that this probably wouldn't be possible on early and/or entry-level models, I expect Apple will have convenient rapid-charge options for when users are in the shower.
Moving on to identity, this would be one of the key functions of the device. Apple will provide statistics about how much time users spend entering pass codes into their iPhones and will implement authentication features for iOS and OS X devices that will allow users to unlock their watch once per day (perhaps with a fingerprint swipe) and then automatically unlock all their other Apple devices while within range.
Finally, mobile payment would be a windfall for Apple. They could pitch the watch, perhaps with a fingerprint sensor, as a more secure payment model than credit cards. They frequently brag about having more registered credit cards than other companies and having a more affluent customer base than Android. If they could capture a small commission on all their customer's purchases, even at brick and mortar locations, they'd make another fortune.
In October 2005, then Chief Technical Officer Ray Ozzie authored a memo to Microsoft staff titled "The Internet Services Disruption."Â While overtly attempting to marshal the company to move aggressively towards integration and online services, two key subtexts of Ozzie's memo were:
- If we don't do this, someone else (probably Google) will.
- Startups and open source projects are threats, but they can't [yet] scale the way Microsoft can.
Ozzie saw that the essential impulse that had driven Microsoft to a decade of dominance under Gates was wounded and flagging after the Justice Department's antitrust scrutiny and a series of missteps that had left Microsoft scrambling to create web services that could compete with Google's offerings.
Jump forward to 2013 and Ozzie's memo looks like Apple's roadmap for the past decade.Â Apple, much more so than Microsoft, has been able to integrate content delivery, third party applications and services, and mobile and desktop computing.Â Sure, Apple CEO Tim Cook (along with his predecessor Steve Jobs) would tell you that Apple's success stems from their drive to provide simple, refined solutions that make their customers' lives better.Â Gates, Ozzie, Ballmer (on a good day), Zuckerberg, Schmidt, Page, Brin and a host of others would say something similar about their own companiesâ(TM) motivations. The real underlying drive for Apple, however, is the same impulse that drove Gates and Microsoft to such success in the nineties. It is the same flame that Ozzie (now departed from Microsoft) was trying to rekindle in 2005 and that Google has recently embraced. Apple, above all, wants to consolidate control.
Viewing Apple's maneuvers over the past several years in this context, even their often-questioned decisions to neglect the professional and enterprise markets and transition away from Google's superior mapping solution make sense. There are times when Apple's interests seem aligned with those of its customers (e.g., wrangling better licensing terms from the recording industry by publicly vilifying the industry's insistence on digital rights management), and Apple never fails to highlight those instances in its public relations copy. But there are also many occasions where Apple has clearly calculated that forcing its users and third party developers through difficulty (the omission of a file browser in iOS, preventing side-loading applications, breaking its promise to publish the FaceTime specification, etc.) are worthwhile in order to shore up its own control.
Apple's consistent behavior also provides insight as to where they're headed. While they may not reveal all of the following initiatives at WWDC, all of them will surely be in evidence, even if they're only beginning to sew seeds.
The Mac As A Locked-Down Platform
The success of iOS and the App Store model assured the Mac's transition to a locked-down platform years ago. There's simply too much money to be made by capturing a percentage of all third-party software developers' revenue on the platform. While with iOS, Apple was able to introduce a new platform that was relatively locked down from the beginning, locking down the Macintosh after decades of having an open software distribution model needed to be done gradually.
Apple has already taken the initial steps of creating the Mac App Store (OS 10.6), introducing Gatekeeper (OS 10.8, retroactively added to OS 10.7.5), and shipping closed hardware (e.g., MacBook Air, Retina MacBook, 21.5" iMac). One of Apple's other bold moves, however, was to allow its most expandable and user-serviceable system - the Mac Pro - to wither without major upgrades for years. This means that Apple's power users are starved for new power systems, and will be more likely to adopt a locked-down redesign, even if it means that they'll sacrifice hardware and software flexibility.
Looking first at the software side, at some point, whether it is in 10.9 or a later OS X edition (perhaps OS 11, or whatever they call 10.10 - X11, perhaps?), the Gatekeeper setting will vanish and Apple will only allow applications to be installed from the Mac App store. They can pull this off by making the locked version of OS X irresistible: new Macs sold after the OS release will have no option but to run the updated OS, and Apple can make the upgrade free, as they did with iOS updates beginning with iOS 4. They can also switch all their Internet Recovery servers over to the new build of Mac OS X, so Macs attempting to reinstall Mac OS X through the internet will have to upgrade.
Apple can also leverage its plethora of iCloud features to force an OS X upgrade. Want to continue using Photo Stream, iTunes Match (or the new iTunes Radio), Documents in the Cloud, etc.? Upgrade to the latest [free] OS X or lose connectivity. Additionally, Apple can introduce new iCloud features like roaming user accounts (log into any Mac with your Apple ID and have full access to all your apps, settings, and data) to encourage users to migrate.
While there will inevitably be an outcry by some, Apple will attempt to mute it in predictable ways:
- x% of Mac users never switch off Gatekeeper
- Gatekeeper has helped keep the Mac secure
- it's free, and no one is forcing users to upgrade (for now)
- the new structure is the only way Apple can provide roaming user access to all apps, settings, etc. from any Mac
- if your favorite app isn't available on the Mac App store, get the developer/publisher to put it on there
- you can still use Boot Camp and/or (Apple's or Apple-approved VM solution) to run non-Mac OSes
Microsoft and Adobe's cloud initiatives in part suggest that they fear locked-down OS X is imminent. They'll try to resist putting Office and Creative Cloud/Suite in the Mac App store as long as they can, and have lowered the initial cash outlay required for users to switch. (Already subscribed to Office 365 or Creative Cloud? Move to Windows and continue to enjoy the same programs you're already using. And remember, the new OS X doesn't have Office/Creative Cloud.)
Apple also realizes that users' allegiance to Microsoft and Adobe apps is a hurdle they'll have to clear. For their part, they could simultaneously reduce dependence on Office and lower the high price of entry for Macs by coming out with a new version of iWork (which hasn't received a major upgrade since 2009) that boasts strong Office compatibility and a low (perhaps free) price point. With Microsoft planning to include Outlook on Windows RT soon and Google Docs always lurking as a free alternative, Apple will need to push productivity options on iOS and a locked-down Mac platform. They can also crib features from other suites (and perhaps Ozzie's memo - Keynote broadcast to the web?).
Regarding the Adobe applications, by improving features in iPhoto and other iLife applications (along with online services linked to Photo Stream), Apple can obviate most consumer's need for additional image editing applications. As Google powerfully demonstrated at its I/O conference this year, it's possible to automate photo editing and presentation and get better results than most users are capable of with Photoshop. Some users want better tools, but most would prefer to not do any work at all.
To dovetail with new iOS file browser/sharing features, the Finder on the Mac could be further simplified, removing low level access to system files. Additional features could be added to iCloud's Documents in the Cloud functionality to remove users' dependence on Dropbox.
On the hardware side, the Mac Pro will probably debut at WWDC sporting Thunderbolt 2 and a relatively closed chassis (with availability later this year, after OS 10.9 ships). Apple will likely emphasize Thunderbolt as the expansion option for the Mac Pro, perhaps with a design for encapsulated "modules" that can be easily added on (e.g., for storage, audio and graphics processing, etc.).
As 802.11ac will be a selling point of all the new Macs (Pros and Airs), Apple will show off a new Airport Extreme base station (perhaps with USB 3).
Apple will also likely reveal its wristwatch initiative. It needs to have a wearable computing device to capture mind share (the mainstream press will in the same breath mention "Apple's and Google's wearable computing devices"), and it can solve some of the grating authentication issues that currently burden users while putting forward a device with a lower nerd-factor than Google Glass. The largest question about the watch initiative is what, if any, functionality beyond a simple timepiece it will have when apart from other Apple devices?
Apple's premier television services aren't ready for prime time yet. They still have a lot of work to do to push stubborn content owners to provide permissive licenses, so they'll focus on limited new development options for Apple TV to put pressure on the television and movie industries. Patiently, they'll keep inching closer over the next year towards a radically different television model, with Apple-curated content (everything on demand, live television, restrictions on digital on-screen graphics, advertisement supported, pay-per-view, and subscription services all integrated, etc.).
The Big Picture
The established truth that Apple has demonstrated again and again is that consumers care about consumption and sometimes creation, but not computing. If the average user has an option to think less about computing (how does this system work?, what software should I use?, how do I connect to the internet?, how do I manage my data?) and focus more on consumption (and to some extent, creation), they will gladly pay more money, forfeit privacy, and give up control. Apple today, as Ozzie did in 2005, knows that larger companies with a vast constellation of integrated hardware, software, and services can create an inescapable inertia for their customers that makes it impossible for smaller companies, even those with better individual services, to gain marketshare.
Short-lived backlash is tolerable for Apple, especially when the stakes are as high as they are now. The question at the moment is not if Apple will take the next major steps to consolidate its control, but when it will do so and how long consumers will tolerate ceding their independence. At the moment, it looks like the answers are "soon" and "for quite a while."