Thank you very much. Thank you. Thank you. Thanks.
You know, I'm very happy to be here today with you all. And as some of you may know, about five months ago, I had a liver transplant. So I now have the liver of a mid-20s person who died in a car crash and was generous enough to donate their organs. And I wouldn't be here without such generosity.
So I hope all of us can be as generous and elect to become organ donors. I'd like to take a moment and thank everybody in the Apple community for the heartfelt support I got too. It really meant a lot. And I'd also like to especially thank Tim Cook and the entire executive team of Apple.
They really rose to the occasion and ran the company very ably in that difficult period. So thank you guys. Let's give them a round of applause. So I'm vertical.
I'm back at Apple, loving every day of it. And I'm getting to work with our incredibly talented teams to come up with some great new products for you all in the future. So it's wonderful. Thank you.
So today, we get to talk about music. Before we do, I'd like to say, number one, I'm going to have Phil Schiller join me for part of the presentation, as well as Jeff Robbins, our VP of iTunes engineering. And before we dive into music, I'd like to talk for a minute about the iPhone. It's thrilling to report to you today that in a little over two years, we have sold 30 million iPhones.
30 million. And during the last year, one of the reasons for that has been the remarkable App Store. The App Store is just a little over a year old, and we have now over 75,000 apps in the App Store. And users have downloaded over 1.8 billion apps.
Isn't that incredible? And that does not include updates. If it included updates, the number would be a few times more than that. 1.8 billion applications have been downloaded.
Now today, we have something new for iPhone and iPod Touch owners. We are introducing iPhone OS 3.1. It's got a bunch of really nice features in it and a bunch of bug fixes as well. And I just want to highlight two new things today.
The first one is our Genius technology. Our Genius technologies work really well for automatically making playlists from songs in your music library that go great together. We've applied that same technology now to apps in the App Store. Wouldn't it be great if the App Store could make recommendations of apps to you, just like Genius is making recommendations of songs?
And that's what it does now. It automatically makes recommendations from the App Store based on the applications you own. And it's really nice. You turn it on on your iPhone or iPod Touch, and we've added a third button here called Genius next to new and what's hot.
And it'll show you recommendations based on what you already own. It'll even tell you what it's basing it on. And this will only get better and better and better as we get larger databases of people, what they buy, what they like. The recommendations will get better and better, just like they have for music.
The second thing we're adding today is ringtones. We're adding ringtones to the iTunes Store. We have over 30,000 ringtones from all four major labels. They're going to be sold at a breakthrough price for ringtones of $1.29, free previews, one-click purchasing.
And they're in the iTunes Store. We've bumped podcasts over under more, and we've given that slot to ringtones. And you can just buy ringtones just like you can other music. And they show up right on your iPhone, and you can set them to be ringed for any particular number or be your default ringtone.
It's really easy. So those are just two of the features in 3.1. 3.1 is free for iPhone and iPod Touch customers with 3.0, and it's available today. It's a free download from iTunes, so go check it out.
It's really nice. So let's move on to music. Well, to start with, let's start with iTunes. We all love iTunes.
We use it every day. So do people around the world. iTunes is now in 23 different countries. We just opened Mexico a few weeks ago.
And iTunes is the number one music retailer in the world now. We've sold over 8.5 billion songs. But a statistic that's even more amazing to me is we've recently crossed over 100 million accounts on iTunes, and all with credit cards, all with one-click purchasing. So that makes iTunes one of the largest stores on the web.
100 million accounts. So today, we're introducing something really great, and that's iTunes 9, the next major release of iTunes. And this is what iTunes has looked like to date, and this is what iTunes 9 looks like. We've cleaned it up quite a bit, made it much easier to navigate around, and you'll see it in just a few minutes.
But I want to cover a few features of iTunes 9. First of all is Genius Mixes. We're going to be applying Genius to yet another area. Now, when we first introduced Genius, it's gotten a great response.
iTunes Genius is pure genius. And people have submitted now over 27 million libraries, and each has been about 2,000 songs. And so they've submitted over 54 billion songs that they have got in their libraries. And we've analyzed all of them, and the Genius database has just gotten smarter and smarter and smarter, and hopefully the recommendations have gotten better and better and better.
And they've enabled us, they've enabled all of us, to make these Genius playlists. We pick a song from our library and automatically get a playlist of other songs in our library that go great together with that song. Well, we're applying that same technology and that same database now to something new called Genius Mixes. And what Genius Mixes are is imagine a Genius DJ that plays endless mixes of songs from your iTunes library that go great together, almost like radio stations.
And iTunes will make up to 12 of them based on the music you have in your library and this awesome Genius database. And you just click on one to start playing it and you see the album it's playing in particular, but they'll go on and on and on playing songs that go well together from your library. And it's really quite something. It's like a great DJ or a great radio station.
And we think you're really going to like this. So Genius Mixes. Next, improved syncing. When you want to sync stuff to your iPod Touch or your iPhone, we can make that even better.
And we have. So as an example, when you're going to sync music now, you can say, I want to sync these playlists, but I also want all of the music by Bob Dylan. And I want, you know, a rock and roll genre, everything from rock and roll. And it'll automatically figure that all out and put the right music on your iPod or iPhone.
It's really nice. Or you might be in photos. And of course, if you have a PC, you'll sync photos from your folder onto your iPod or iPhone. But if you're on a Mac, you can sync albums, but you can also have events and faces from iPhoto and say, well, I want to sync these albums, but I want Becky's birthday and I want all the photos that have a Lee in them.
And it'll automatically do the right thing. Same with movies. I want the latest three movies that I've bought or rented, but I always want Ratatouille. So it'll do the right thing.
Maybe the most popular thing that we're adding in improved syncing, though, is a way to manage your applications on your iPod Touch and your iPhone. This is really wonderful and allows you to arrange your applications however you want really fast and then automatically change them on your iPod Touch or your iPhone. It's wonderful. So improved syncing.
Next up is home sharing. Now, today, you can stream music from other computers in your house. You can look at their library. You can look at the libraries of your kids, your spouse, whoever, and stream music from those libraries and listen to it on your computer in your house.
And it's really cool. But we can go much further than that because with the new home sharing, we're going to let you copy songs, movies, TV shows, etc. among up to five authorized computers in your house. And so when you turn home sharing on by typing in your name and password, you're going to still see all the other computers you can share within your house.
You can click on that and you'll see their contents. You can stream the contents or you can select it and drag whatever you want right into your library and it will copy it. And you now have a copy. Matter of fact, we make it even easier for you with this little control down here where you can see only stuff on another computer that's not in your library to make it easy to find what you want to copy over.
And you can even set it up to do this automatically. So it's really nice. Next up is a redesigned store. The iTunes store is just much, much cleaner, much better navigation so you can get from anywhere to anywhere almost instantly.
New artist pages that are very nice. New movie pages, new TV pages. It's just a much, much cleaner layout that I think you'll enjoy. And finally, something I really love, iTunes LP.
You know, some of us here are old enough that we actually bought LPs. And it was great because you not only got the music, but you got great photography. You got liner notes. You got essays.
I mean, you know, who could forget some of these classic albums? And unfortunately, most of that stuff left us when we went to CDs and then, of course, even more so when we went to digital music. And that shouldn't be the case. We can deliver amazingly rich content digitally, and that's what we're doing with iTunes LP.
So you bought a great album in the past. You can get that content again with iTunes LP. So this is iTunes LP for American Beauty, an awesome Grateful Dead album. And it's got everything with it.
It's got videos. It's got liner notes. It's got all sorts of stuff. So here's an example of some lyrics.
Here's an example of a chronology of their albums that you can go into and all the songs. Here's a Bob Dylan album. Here's a great Doors album. Norah Jones album.
Pearl Jam. Dave Matthews Band. And the artists themselves can get involved with creating these things. We're giving all the tools to the labels and the artists so that they can bring their creativity directly to the listeners.
And we think this is going to be really outstanding. So these are just a few of the features in iTunes 9. And what I'd like to do now is invite Jeff Robin up to give us a demo. Jeff.
Thanks, Steve. Good morning. I'm really excited to be able to show you some of the great new features of iTunes 9. So let's get started.
Here it is. So I'm going to begin by showing you one of my favorite features, which is the app organization. I'm going to connect my iPod Touch. And here it is showing up on the left.
So when I click on applications, now you can see all of the applications that are on my iPod. You can see all the pages. I can just click on them. And if I want to rearrange them, I can just click on an app and drag it wherever I want it to go.
It's really easy. If I want to put it onto another page, just drop it right there. You can move it around. I can even select more than one at a time and drag those and put them where I want them.
And iTunes just lays it out for you automatically. On the list on the left, you can see all of the applications that are in my library. Here's one Bejeweled 2. If I double-click on it, it'll take you right to it on your iPod.
If you've got a lot of apps, this makes it really easy to find where things are. And you know, I've played a lot of Bejeweled lately. I'm going to just remove it from my iPod. Click, and it's gone.
It's really easy. We've also added the ability to search. I'm going to look for Tetris. And if I want to add that to my iPod, I just drop it there.
And you know, I play my games a lot. There are a lot of great games on the iPod and the iPhone. I'm going to put my games page up to the top. It's really easy to rearrange and organize all the applications right on your iPod.
And when you're done, just click Apply, and all those changes are made. It's that easy. So now I want to show you Home Sharing. So I've already set this up so that my wife's computer is turned on for Home Sharing.
Now I just need to turn it on for mine. So I'm going to enter my iTunes account and password. Click Create Home Share. Home Sharing is on, and you'll see that Laura's library shows up in the list on the left.
I can just click on it. It loads her library, and I can see everything on there. Open the triangle. You'll see music, movies, TV shows, even apps.
Everything on her library is available to me. And I can scroll through, and if I see a song I like, I can just play it. Just like regular streaming. But the one thing you can't do with regular streaming, select the tracks and drag it to your library.
It's that easy to manage content within your home. If I go down here, you can see this pop-up for showing all the items or the items that aren't in my library. Now you can see just what's different between the other library and yours. And when I select the tracks and tell it to copy, you can see they just disappear from that list.
Those songs have been copied into my library. And if you want to have it automatically sync new purchases under settings, just turn it on for the types of content you're interested in. And now iTunes, whenever a new song or movie, TV show, or app is purchased on that other library, it's going to automatically copy it into iTunes. It makes it really easy to manage the content within your home.
So that's Home Sharing. So let's take a look at the new iTunes Store. This is what the new store looks like. It's a really clean look.
All of the pages throughout the store have been redesigned in this style. One thing you'll notice right away is that there's this new navigation bar at the top. So I can easily go from anywhere in the store, any page, and go directly to music, movies, or TV shows. There's even a drop-down if I want to go right to a genre.
I can just go right to rock, and it takes me there. On the top charts, we've made it even easier to preview what's there. I can just click this preview button. And when you've found the song that you want, just click buy right from the chart.
It's really easy. Here's all the new music that's available this week. And I can just easily slide through it. And when I see what I'm interested in, like this Kings of Leon album is pretty great, there's an iButton right on the cover.
And if I click it, you get a quick view of that album. And previewing, just as easy as with that top song chart. And when you're ready to buy, just click buy. You may have noticed we've got these arrows next to all the buy buttons through the store.
We've added some interesting new features here. I can gift the album. I can add to a wish list. You know, wish lists have been a huge request for the iTunes Store.
And now we've got that with iTunes 9. And I can also share directly to Facebook or Twitter a link to any of the content within the store. Let me show you how that works. It takes me right to my page.
I can type a note, click share, and it'll be posted right on my wall. Really easy to post information about songs and albums that you're interested in right on Facebook. So those are just a few of the things that we have for you with the new iTunes 9 store. We think you're really going to love it.
So Steve mentioned iTunes LP. Let's take a look. Here are five albums that I bought from the store. And these are some really great albums with some fantastic iTunes LP extras.
Let me show you The Doors. It's a great interactive experience. It's got photos, videos, memorabilia, chronology, even liner notes. If I go to the song list, you can see all the songs that are on the album.
I can just play it. And of course, we've got the lyrics. I can just flip through the songs. When I see something I like, like this one is really great, I'm going to play it.
The photos are amazing. If you're a Doors fan, this kind of extra material is simply priceless. You can go full screen. It's even got some exclusive videos.
These videos were recorded exclusively for this iTunes LP. Here's one from the keyboardist of The Doors. I'm going to go to a section I really think is cool here. There's some great extras on these iTunes LP.
Let me show you one more. This one's from Dave Matthews Band. These, they can be so beautiful. Let me explore the songs.
I can just flip through. You know, the artwork for this LP was drawn by Dave Matthews himself. The handwriting is even based on his own, or the fonts is even based on his own handwriting. I can play the track and just scroll through.
You can see all the lyrics. And just like the Doors, there are exclusive videos here. All sorts of extra content. If you're a fan, this is a great way to rediscover music with albums.
So I have one last thing I want to show you. And that's something that we're calling iTunes Extras. Just like we've got iTunes LP for music, we have iTunes Extras for movies. So here's one for WALL-E.
It's got all sorts of extra features. Exclusive features, bot files. You can just click around and discover it. There's some great video content.
It's even got a really nice chapter picker. You can flip through, find your favorite scene. Here's one I really like. Lots of great extras.
It really makes that movie experience feel even that much more complete. So those are just some of the cool new features in iTunes 9. Look forward to having you play with it. Thank you, Jeff.
So again, some of the very cool features of iTunes 9. iTunes 9 is available today. It's a free download at Apple.com. So that is iTunes. Now, the biggest release of iTunes in a long time.
I think you're going to like it. So now let's move on to the iPod. And let's Phil Schiller to come up and tell us about some new things happening in the world of iPods. Phil.
Good morning, everyone. If you haven't heard, the iPod has been a big hit. It's absolutely incredible what's happened. We've now sold over 220 million iPods to date and growing.
And that makes it one of the most successful products in history, of all products. It's incredible. Customers love the iPod. If you look at the latest market share data in the U.S., the iPod is now at 73.8% market share.
It's unbelievable. The next biggest category, other. Other at 18%. Right after that, SanDisk just over 7 and Microsoft pulling in the rear at just about 1%.
It's unbelievable. And yet, with this amazing market of over 220 million iPods, we continue to reach more and more people. In fact, our latest data shows that of all the iPods we sell today, just over 50% are to customers that are new to the iPod. It's their first iPod.
We love it when we help new customers discover how great it is to have a great portable music playing device. The fastest growing of our iPod line is the iPod Touch, our most innovative product. And it's incredible. The new iPod Touch is just beautiful with that great 3.5 inch multi-touch display.
And I'm really proud to tell you that to date, we have now sold over 20 million iPod Touch. 20 million. That's in addition to the 30 million iPhones that Steve talked about. It's just remarkable.
This amazing new technology is taking off so quickly. And it is such a great, beautiful device. But you might ask, why so quick, so many iPod Touches? Well, we have an idea.
We think of three things that really set it apart from any other device that's come before. First, it's a great iPod. And of course, it needs to be. It's the iPod Touch.
It is an amazing way to listen to your music. You just use the multi-touch display to flip through any songs you want to find or to discover a new album you want to listen to and just tap on it and play. It's an amazing music experience. It's also a great video experience.
You can watch video podcasts, TV shows, movies, even new movies in iTunes that you can rent and put on your iPod Touch to watch on that beautiful 3.5 inch display, tap, and just enjoy your video. So it's incredible for listening to music and playing videos. It's also great for discovering new music, like this new Green Day album. Because built into every iPod Touch is Wi-Fi and the iTunes Music Store.
So now, wherever you are, you get on Wi-Fi and you just start surfing and finding something new to listen to, to take with on a trip, whatever you want to do. It's incredible. It's also great for discovering music on your iPod Touch because with thousands of songs, sometimes you forget all the great content you have. And that's where Genius comes in.
This Genius technology is just incredible for helping you find music you love and just enjoy this experience of listening to music on an iPod Touch. Of course, you can create playlists, as Steve talked about. You just tap a song and say, make a Genius playlist. Your iPod Touch will make a playlist out of that song and other songs you have that go great with it.
You can just sit back and enjoy it. And now, with the new Genius mixes, you can also do that on the iPod Touch as well. You don't even have to select a song. iTunes automatically creates mixes for you of the songs you have that go great together.
So the iPod Touch is a great iPod. Customers are already starting to figure out it's also something else. It's a great pocket computer. That's a really cool idea.
That built into every iPod Touch is Wi-Fi. So wherever you can get on Wi-Fi, you can get on the internet. Which is great because the iPod Touch is the first great mobile browser, Safari. And with Safari, you can have a desktop-like experience.
You can surf the web in portrait and landscape. Go to all of your favorite sites all on this great little pocket computer. Of course, it has great email as well. You can have rich HTML email.
You can have attachments. You're never disconnected with an iPod Touch. You have access to all your contacts as well. You can enter them right on the iPod Touch, sync them back.
Or you can just sync them all from your PC or Mac automatically through iTunes. And of course, you can sync them wirelessly with MobileMe. And there are so many applications in the App Store to really make this a rich experience. Things you like to do on the desktop, you can do right on this amazing little computer.
Things like Facebook. If you have a Facebook account and want to keep in touch with all your family and friends, it's really cool to do on an iPod Touch. Maybe you're a Twitter fan. And there's the people you like to follow their tweets.
Well, you can do that too. All this power in this little amazing computer. And it really fits in your pocket. Not everybody can say that.
Not everybody's computer fits in their pocket. But ours really does. It's the iPod Touch. It's a great iPod.
It's a great pocket computer. And you've probably noticed people starting to talk about one other thing. It's a great portable game player as well. This beautiful multi-touch display and accelerometer have allowed developers to create incredible new games on the iPod Touch.
And people are starting to notice. For example, Businessweek wrote, Apple could be on the cusp of claiming the crown as the world's leader in handheld gaming. And that's pretty big words when you think about it. The companies that have come before us.
Nintendo and Sony with devices like the PSP and the DS. When these things came out, they seemed so cool. But once you play a game on the iPod Touch, you know they don't really stack up anymore. They don't have this amazing multi-touch user interface.
The games are kind of expensive. They don't even have anything like the App Store for finding great games and titles. And they certainly don't deliver a media experience like the iPod that's built into the iPod Touch. And when I say they're expensive, we're talking about $25, $30, $40 for a title.
A lot of kids can't afford a lot of titles. When you give one of those, you're giving a need to spend a lot of money on those titles. But worse isn't the price. It's the buying experience.
Having to go to a store and try to find a hot new title for one of those devices is not a lot of fun. The buying experience on an iPod Touch is incredible. It's truly breakthrough. Built into every iPod Touch is the App Store.
You can find access to all of the 75,000 titles. It's just incredible. If you look just at the gaming and entertainment category alone, you're going to see a big difference. So I'm going to bring up a chart of the gaming and entertainment titles available on Sony PSP, Nintendo DS, and iPhone OS.
And here's what it looks like. Sony PSP, 607 titles. Nintendo DS, 3,680. iPhone OS, 21,178. It's absolutely incredible the amount of work developers are doing to bring amazing content to the iPod Touch and the iPhone.
Now, if you haven't had a chance to play some of these amazing new games and titles yet, we've actually grabbed some video off of an iPod Touch to create something just to show you how cool these games have become. And let me play that for you now. Those games are just amazing. And every day, we're seeing new titles come out that just blow our mind.
And so we wanted to share a few of the things we've been seeing going on in development with some of the developers with you so you can see these things for the first time. So we're going to ask a few developers, our really good friends who are working hard on this software, to come on stage and show you a few things. First up, we're going to invite up Ubisoft. Now, Ubisoft, if you don't know, is a leader in the entertainment industry.
And their hot title, Assassin's Creed, became the fastest new video game brand ever. And to tell us what's coming up next with Assassin's Creed is Ben Matz, producer of Assassin's Creed at Ubisoft. Ben. All right.
Wow, I'm really happy to be here. And let's jump right in. So Apple has created a world-class gaming platform with the iPod Touch and the iPhone. And Ubisoft, as Phil was saying, is putting the finishing touches on one of this holiday season's hottest entertainment properties, Assassin's Creed 2.
I'm here today to tell you about how we're bringing these two together. In Assassin's Creed 2, you play the hero, Ezio, an Italian nobleman from a family of assassins who've been fighting against the Templars throughout history.
