Apple won't be caught out, says Cook
AS SALES of the iPhone declined for the second straight quarter, Apple CEO Tim Cook peeled back the curtain ever so slightly on its work in artificial intelligence (AI) and augmented reality (AR), aiming to reassure investors that the company is ready to ride the next wave of technology.
Raving about hit smartphone game Pokemon Go, he stressed that the company is "high on (augmented reality) for the long-run" and investing heavily.
AR, in which computer-generated content is overlaid on the real world, is one of the latest fixations in the technology business, with Pokemon Go among the first apps to catch on.
Mr Cook also highlighted Apple's investment in AI, which the company now uses to recommend content to users and even spot usage patterns to improve a device's battery life.
It was a small glimpse of the future from the notoriously secretive tech giant, which fiercely guards its product pipeline.
But analysts said Mr Cook must do more to show his cards as sales of the iPhone slow.
AR and AI are often regarded as an uneasy fit for Apple, a hardware maker that tends not to embrace new technology until it matures.
And Apple's habit of keeping quiet until it has a finished product to show - in contrast with rivals such as Google and Facebook, which iterate products in the open - does not help, said analyst Bob O'Donnell of TECHnalysis Research.
"They're in this weird position where they want the world to know that they are working on it but they have nothing to show for it," he added.
As rivals such as Google and Facebook double down on AR, Apple has made no public display of its aptitude in the field.
But Mr Cook stressed that the company is hard at work behind the scenes.
"We've been and continue to invest a lot in this.
"We think there's great things for customers and a great commercial opportunity."
Apple has more to show for its efforts in AI, where it was an early pioneer with its Siri digital assistant.
But the company has been dogged by doubts that it has fallen behind rivals such as Amazon and Google and will be hard-pressed to catch up due to its strict privacy stance.
"They are running behind, and they are trying to catch up both in perception but also in fact," said Oren Etzioni. He is CEO of the Allen Institute for Artificial Intelligence and a professor at the University of Washington.
Mr Cook maintained that Apple had found a way to strike the balance between progressing in AI and maintaining users' privacy, detailing features in Apple's latest operating system.
"The deployment of AI technology is something that we will excel at because of our focus on user experience," he said.
Ultimately, he argued, phenomena such as AI and AR will reinforce the importance of the iPhone.
He said the company was working to make sure its products worked well with third-party products like Pokemon Go.
"That's why you see so many iPhones in the wild right now chasing Pokemons," he noted.