By Julia Love and Yasmeen Abutaleb
SAN FRANCISCO (Reuters) - Apple announced its new music streaming service on Monday, dubbed Apple Music, entering a hotly competitive market but offering a product that comes with tremendous strengths.
Calling it a "revolutionary music service," legendary music industry figure Jimmy Iovine took the stage at the company's annual conference for developers to unveil what had been widely expected ahead of the event. Apple Music includes a service to connect artists and fans and what the company described as a global radio station called Beats 1.
While late to the streaming music business, Apple has strong advantages: deep relationships with music companies; a global brand; and hundreds of millions of customers - and their credit cards - through iTunes.
Apple Music's $9.99 a month price takes effect after a three-month free subscription period. The company is also offering what it calls a "family plan" for $14.99 a month for up to six family members.
Earlier in the event, Apple Chief Executive Officer Tim Cook announced that so-called "native" apps will be introduced in the next version of the operating system for its Watch that should make apps for its latest gadget speedier and help untether it from the iPhone.
The company also unveiled new details about its Apple Pay service, saying it was already supported by more than 2,500 banks and will surpass 1 million locations accepting it next month. In addition, the company said it would roll out the service to the United Kingdom next month.
In a related move, Apple said it would rename Passbook, its app for credit and debit cards and boarding passes, to Wallet.
Apple Inc (O:AAPL) shares were down 0.5 percent at $128.05 in afternoon trading.
The company also unveiled the next version of its operating system for Macs, El Capitan, continuing the company's theme of naming key updates to the software after California landmarks. The software will be available in the fall.
Like other Apple products, the Watch's commercial success will likely hinge on a compelling collection of apps. But early apps for the timepiece have been tethered to the iPhone, placing some limits on what developers could do.The expanded software kit should lead to better and faster watch apps, said Bob O'Donnell, an analyst at TECHnalysis Research, in an interview before the event.
But it was the music service that was the highlight of the event. The company behind the iPod and iTunes has long been a leader in digital music, but it has lost ground in recent years as subscription services such as Spotify have caught on with consumers.