Finally, Apple Addresses Its Biggest Weakness

For all its innovative designs, Apple (NAS: AAPL) has a clunker in iTunes. And you know what? CEO Tim Cook knows it, too.

According to Bloomberg News, the Mac maker is planning a massive overhaul of the service. Planned features include using iCloud to better synchronize downloaded entertainment across a number of devices and more tools for sharing music.

We'll know the details when Apple is ready to announce them. In the meantime, let's take a look at what iTunes isn't and what it could be.

Synchronicity: more than just an album from The Police
Apple's ecosystem isn't nearly as elastic as those of its partners and rivals because everything is downloaded. Thus, if you start a purchased movie on your iPad and then switch to your Apple TV, you'll have to start the watching experience over again. Each device manages content independently.

Rentals are where this problem comes into sharp relief. Say you purchase a 24-hour rental of Oscar-winning flick The Artist from your Mac. Because you're downloading a file, you're tied to that device for your rental. Netflix (NAS: NFLX) , by contrast, serves 100% of its content via streaming from a growing and interconnected network of servers. (NAS: AMZN) has a similar system for their customers. Whether you're a Prime member streaming free content or purchasing new premium TV or movies, the e-tailer delivers over the Web. That way, you can start and stop watching at will and then catch up at exactly where you left off.

Google (NAS: GOOG) is also getting into the game of providing synchronicity. I'm only going by my own experience here, but when I watch shows in spurts while logged into YouTube, the service now keeps my place. And not just for everyday videos. The Big G also has a provision for streaming rentals from its Play video store in YouTube. This weekend, I've been stopping and restarting Morgan Spurlock's documentary, Comic-Con Episode IV: A Fan's Hope, in honor of one of my favorite annual geekfests.

Spying on Spotify
Synchronicity is important, but it's also one of two major issues Bloomberg says Apple will address in the next version of iTunes. The new store and related apps are going to be more social.

To be fair, Apple has tried this before with the failed music network Ping. What would be different this time? My guess is the Mac maker would channel features that make Spotify popular.

If you've yet to try it, Spotify is an app that aggregates music your own and music you can stream into a single player. You can also share a single track with a friend or broadcast your current playlist. Because of its social proclivities, Facebook (NYS: FB) has essentially deemed Spotify its version of iTunes Music. Meanwhile, Spotify's new mobile app uses Facebook Connect to login for sharing and saving of music tracks discovered while on the go.

Apple, too, has increased engagement with both Twitter and Facebook, which makes social sharing of playlists a likely option in the new iTunes. Apps might also make the service more compelling. Right now, Spotify includes TuneWiki for syncing lyrics with tracks, Rolling Stone Recommends for access to the top choices from the legendary magazine, and Tastebuds for meeting people who share your listening interests, among others. Spotify is using music to create a social hub -- an opportunity iTunes has largely ignored outside of its meager efforts with Ping.

Breaking bad rules
And those are just two areas where iTunes needs help. There's also the prospect of transforming the service into a digital wallet that challenges Google and eBay. What else did I miss? Which businesses did I miss? Or, conversely, do you expect Apple to simply tinker with iTunes and move on to bigger projects?

Either way, it pays attention to study potential shifts since, over time, the market rewards those that lead the rebellions.

Want even more Apple analysis? Be sure to check out our brand-new premium research report on the company, straight from our top technology analyst, Eric Bleeker. You'll receive his take on Apple's biggest opportunities and threats, along with a full year of updates. Learn more.

The article Finally, Apple Addresses Its Biggest Weakness originally appeared on

Fool contributorTim Beyersis a member of theMotley Fool Rule Breakersstock-picking team and the Motley Fool Supernova Odyssey I mission. He owned shares of Apple, Google, and Netflix at the time of publication. He also had a long-term call position in Netflix. Check out Tim'sWeb home,portfolio holdings, andFoolish writings, or connect with him onGoogle+or Twitter, where he goes by@milehighfool. You can also get his insightsdelivered directly to your RSS reader.The Motley Fool owns shares of Facebook, Netflix, Google,, and Apple.Motley Fool newsletter serviceshave recommended buying shares of eBay, Google, Netflix, Apple, and and creating a bull call spread position in Apple. We Fools don't all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. Try any of our Foolish newsletter servicesfree for 30 days. The Motley Fool has adisclosure policy.

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.