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As Apple massively reinvents its software, it faces growing pains

Attendees wait for the start of the Apple World Wide Developers Conference
David Paul Morris | Bloomberg | Getty Images
Attendees wait for the start of the Apple World Wide Developers Conference

When iOS instructor Mohammad Azam started teaching Apple's new mobile operating system earlier this year, he found himself skipping lectures in his lesson plan because features were broken.

"Apple used to be very strict," said Azam, an iOS 10 instructor at The Iron Yard in Houston. "It used to be highly polished. Every developer will say that after Steve Jobs you're looking at a downward trajectory."

A Twitter poll of 26 of his contacts, however, surprised him: Developers were split on whether Apple's software quality had gone down "tremendously" over the years, inciting a lively debate.

The debate is nothing new — Apple has laid out an ambitious software vision that has both presented massive opportunities and garnered criticism over the past couple of years. But the stakes are swelling, as investors increasingly count on software as a growing share of Apple's business. Some developers say there's a long way to go.

Lofty ambitions

Software is now the fastest-growing segment at Apple, and CEO Tim Cook reiterated to investors on the company's most recent earnings call that services were on pace to reach the size of a Fortune 100 company by 2017. That goal comes after the company has made serious investments in its software — Cook attributed much of Apple's research and development spending in 2016 to services.

"Going into the quarter AND for long term, we continue to believe that the software and services at Apple are the most underappreciated aspect of the Apple story, particularly the App Store," Macquarie Capital analyst Ben Schachter wrote in a recent note to clients.

The company reported a record $6.3 billion in services revenue in the fiscal fourth quarter, a 24 percent increase. Apple Pay saw more transactions in the month of September than across all of fiscal 2015.

To this end, Apple has made changes to lure developers to the app store, including a new, easier-to-learn language, Swift, and coding environment, Swift Playgrounds, and a new revenue-sharing model for subscription apps. The new MacBook Pro has special features for development platform Xcode.

And more of Apple's code is now open source — a feature Google has always said fosters innovation.

Natasha Murashev, a developer who blogs and organizes conferences about iOS, said she knows of companies who have switched to Swift, Apple's new programming language, and seen bugs fall 60 percent.

Apple App Store
Scott Mlyn | CNBC

"I think Swift has a lot of potential," said Jason Terhorst, who does freelance iOS development outside of his day job. "I think developing for Android is a bag of angry cats. Every platform will have its pain points and iOS is no exception, but it's farther along so it's on the right foot. There are some things that are annoying here or there but they are good about fixing them."

Murashev compared Apple's platform to other programming languages, like Java.

"That's when I kind of laugh when people say Xcode is horrible," Murashev said. "If you want to code for Android, you have to spend at least five hours just downloading tools to run it. The fact that you can download Xcode and it just works is really magical."

'Achilles' heel'

But given the company's ambitious plan to compete against internet companies like Facebook and Google, it also has its share of critics.

Earlier this year, veteran technology journalist Walt Mossberg noted "in the last couple of years ... I've noticed a gradual degradation in the quality and reliability of Apple's core apps. It's almost as if the tech giant has taken its eye off the ball when it comes to these core software products."

Om Malik, founder of Gigaom and partner at True Ventures, has seconded that, calling internet services the "Achilles' heel" of the company. Former Apple executive Jean-Louis Gassee beat the drum last year in his own detailed blog post.

The quality of Apple's developer-facing web applications is not as consistently high as its hardware or software, said Brent Sanders, founder and CEO of Fulton Works, a web and mobile development and design company.

"Instead of doing things that help your business, you have to do things that Apple tells you" -Natasha Murashev, iOS developer

"I would wholly expect that [iOS developers] would be complaining constantly," Sanders said, adding that each new rollout of the operating system has been bumpier for developers than the previous one.

At least some developers — like Azam — have similar complaints, especially with features like the simulator and a tool called "refactoring," that lets you rename functions, a common occurrence in most programming languages.

"Most of the issues are minor and I find a workaround for my students but I think the quality and performance of Apple developer tools is getting low as compared to what it was few years ago," Azam said. "This certainly does not mean that iOS is doomed but I think Apple needs to work harder to make these tools much better and also invest their time and effort in services because in the next two to five years the real battle will be in the form of services and not hardware."

Murashev acknowledges that Apple has "growing pains." Apple users also adopt operating systems much more quickly — which can be both good and bad.

It adds consistency, she said. But it also means that any new or little-publicized change can take a developer by surprise and must be addressed quickly.

"It's like this massive opportunity, but how do you prioritize the time?" Murashev said.

When iOS 7 was released, Murashev said, the start-up she worked at was required to make a lot of design changes. It took two months, and then the company ended up shutting down.

"After WWDC, new things come out, things break," Murashev said. "It's very painful if everything gets put on hold. Instead of doing things that help your business, you have to do things that Apple tells you. ... There were other reasons, but they could have spent two months doing critical user features. "

High stakes

Larger organizations, like CNN, have had recent success collaborating with Apple on new product releases, its developers said at a recent industry panel.

"They want to hit home runs, because it means more use of their devices, more use of their platform," one developer said.

"There are going to be clear winners and losers." -Dan Ives, Synchronoss

Apple's unique ecosystem and software, from iTunes to Final Cut Pro, has always been a strong reason to buy its hardware. But maintaining a pervasive ecosystem, as Apple does, is becoming a key differentiation as mobile phone hardware becomes homogenous across brands, said Dan Ives, who leads global investor relations for Synchronoss, a mobile cloud company.

"All the lines are becoming grayer, between search, software, consumer social media companies," Ives said. "What you're seeing is an evolution of technology, merging of the spaces, consumer and enterprise. There are going to be clear winners and losers."

That requires getting developers on board, said Ives. And even for the king of branding, developers are notoriously hard to market to.

"Developers, that's the keys to the kingdom," Ives said. "You have to get developers around the platform. Consumers will follow developers, developers will follow monetization. That's the next big growth opportunity for Microsoft, Google, Apple. That's the holy grail."