The Big News That Everyone Missed at the Apple Developer Conference

SAN FRANCISCO (TheStreet) -- Music. Bad dad joke after bad dad joke. Appearances by music legends Jimmy Iovine, Drake and Eddy Cue's dance moves to Aretha Franklin.

Apple's (AAPL) developer conference had it all and then some.

In a news-packed keynote address at its annual Worldwide Developers Conference, Apple took the wraps off of a bunch of new software and services. There was the unveiling of Apple's new mobile operating system, iOS 9, OS X El Capitan (which makes me chuckle whenever I hear it), watchOS 2 to Apple Music, there was something for everyone at the event.

Yet the biggest announcement from Apple that will likely have an impact on Google (GOOGL) , Yahoo! (YHOO) and potentially even Facebook (FB) isn't a new music service, it's something that's been around for almost four years -- Siri.

"Siri, Spotlight and other aspects of Apple's operating systems and services are getting smarter, and better at understanding natural language queries," said Jackdaw Research chief analyst Jan Dawson. "Though Google is arguably the leader in machine learning and artificial intelligence, Apple is showing that it's perfectly capable of innovating in these areas, too. But it's doing it in a way that's in keeping with its privacy stance, by keeping personal information on devices and not sharing it with third parties."

What all of this means is Siri is getting smarter and will continue to evolve, thanks to the proactive feature Apple announced. You can ask Siri things like "pull up my karaoke pictures" and it will know to pull up those specific photos. 

It can now make suggestions based off time of day, doing simple everyday tasks such as making lunch.

Apple also noted that there is a search API coming to Siri, which will allow developers to integrate Siri in ways they've never been able to before.

The predictive search area is ripe for innovation, with Google unveiling its take last month and Yahoo! CEO Marissa Mayer hinting on a recent earnings call Yahoo! wants to enter the space, too.

Siri, which was introduced as part of the iPhone 4S, was initially chided in the press and by some users, because of its inability to get requests right, its high error rate, or because people felt uncomfortable talking outloud to a phone (what a concept!).

Now, Siri has not only become a vital part of iOS, with Apple's Craig Federighi noting it now handles 1 billion requests per week, it's getting major improvements, going right at the heart of Google Now on Tap, Google's own predictive assistant. Federighi noted that Siri has a 5% error rate, down markedly from what it had been in the past.

Software and services are a drop in the bucket for Apple. In the fiscal second quarter, it generated $5 billion in revenue from places like iTunes, App Store, Mac App Store, iBooks Store, AppleCare, Apple Pay, licensing and other services, compared to $51.3 billion in revenue from the iPhone, iPad and Mac combined.

Siri is likely to never be a major revenue driver for Apple, given the emphasis Apple is placing on privacy as it relates to your data.

 

But it will help two things -- the war between Apple and Google in innovation is alive and well and it may continue to help spur iPhone sales if people find it useful.

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