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Apple believes smarter services, devices won't compromise your privacy

Apple adds natural language search to Spotlight and Siri, which can now figure out what you want before you do, as it plays catch up with Google and Microsoft. Its edge: a vow to protect your privacy.

Now playing: Watch this: Apple makes your privacy a priority
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Apple on Monday said it loud and clear: We value your privacy more than others do.

Amid a slew of announcements ranging from a new music service to a smarter version of Siri that can predict what you want to know, Apple executives continually hit on the point that it takes your personal information seriously.

"If we do look up something on your behalf, such as traffic, it's anonymous," said Craig Federighi, senior vice president of software for Apple, at the company's Worldwide Developers Conference in San Francisco. "You are in control."

Craig Federighi, senior vice president of software for Apple, hammers home the point: "You are in control." James Martin/CNET

Apple CEO Tim Cook first hammered that theme last week when he said "morality demanded" that people have the right to keep their affairs to themselves. That message is becoming a key differentiator for Apple in its battle against Google and Microsoft, as all three work to become integral to every hour of our lives. Google is especially keen to use your personal information to deliver more relevant ads.

"Apple is drawing the line as to what belongs to customers and Apple vs. everyone else," said Ramon Llamas, an analyst at IDC. "It's a sense of trust that Apple is evangelizing, perhaps as a way to set itself apart from other platforms."

But privacy is only half the battle. Apple also wants its services and products to wow us with their high IQs. That heightened intelligence now shows up several ways, from being able to use conversational language with its Siri digital assistant or Spotlight app, to recommending playlists and finding songs delivered to you via Apple Music, its new streaming service. (Even if you don't know the actual song title.) The new capabilities could help Apple match the higher intelligence shown by Microsoft's Cortana and Google Now and its Now On Tap service.

Unlike Microsoft's and Google's services, Apple's smarter assistants handle most of the work within the device or tap into the cloud without Apple's knowledge.

"There's a difference between the device knowing you vs. the company behind the device," said Carolina Milanesi, an analyst at Kantar WorldPanel. "That is very subtle."

iOS 9 knows your mind

A smarter Siri and Spotlight are part of a broader push to make iOS 9 anticipate your needs.

"On iOS 9, we're bringing proactivity throughout the system," Federighi said.

That means, for example, your iPhone could learn to load up on music perfect for your regular morning jog or bring up an audiobook when you get into your car. The new iOS can also immediately add emailed invitations to your calendar app. Every new device that ships with iOS 9 will be able to take advantage of new security features, like two-factor authentication, said Federighi. Two factor authentication combines what you know -- such as a personal identification number -- with what you are, such as a fingerprint.

The next version of OS X, called El Capitan, will also allow users to type in their questions and searches in natural language on Spotlight, which can hunt within the computer for files or online for information like weather and stocks.

Spotlight now "lets you compose your searches in your own words," said Federighi.

Apple Pay goes wider

Mobile payments demand security and privacy. Apple on Monday described the new capabilities of Apple Pay, even renaming its Passbook to Wallet to reaffirm the notion that it's handling financial transactions.

Apple wasn't the first to introduce a digital wallet -- Google has been attempting to stitch together an alliance of merchants, smartphone vendors and financial institutions for years -- the company was the first to bring it the mainstream.

Apple announced in September that it was partnering with Visa, Mastercard and American Express along with several issuing banks to allow iPhone users to store their credit card accounts on their fingerprint-enabled devices and pay for items by tapping their phones on payment terminals. Apple on Monday added Discover to its stable of payment networks. Trader Joe's and Dunkin' Donuts now add to a growing roster of retailers, which previously included Macy's, Walgreens, Duane Reade, Staples, Subway, McDonald's, Disney and Whole Foods. Apple Pay will also incorporate merchants' rewards cards.

Apple said the service is now available in 700,000 locations, up from 220,000 from when it launched in October -- leading Cook to proclaim, " 2015 will be the year of Apple Pay."

Even so, Apple now faces more competition from Google's Android Pay, announced in late May, and Samsung's mobile-payments service, called Samsung Pay.

Music and News debut

Apple also unveiled two new services on Monday: A Flipboard-like service simply called and the much-anticipated Apple Music, which combines an all-you-can-hear streaming music service with a 24/7 global radio.

With News, Apple again talked about the importance of keeping your interests and reading patterns to yourself.

"Unlike just about any other news aggregation service we're aware of on the planet, News is designed from the ground up focused on your privacy," said Federighi.

Apple Music will take on the likes of Spotify with a service that costs $10 a month (or $15 for a family plan).

Apple Music marks a radical change in how Apple sells music. The company revolutionized the music industry by getting consumers to pay for individual tracks on its iTunes service for 99 cents. Now it wants people to pay $10 a month for an all-you-can-listen service, following Spotify's lead.

Apple co-founder Steve Jobs, known for his love of music, was defiantly against a subscription service. He called the subscription model "bankrupt" in Rolling Stone in 2003 and in 2007 told Reuters "people want to own their music." But as streaming grew in popularity, Apple realized it needed to change with the times. The company in 2013 launched iTunes Radio, a Pandora-like streaming radio service that makes money from advertising. It received a cool reception.

Apple is trying again with a proper subscription service and the backing of hip-hop mogul Dr. Dre, record producer Jimmy Iovine and songwriter and Nine Inch Nails member Trent Reznor, who all joined after Apple bought Beats last year.

The focus on a subscription model is quintessential Apple, which hasn't been keen on "free" when it comes to its services.

"They could have come out with a free service, but they didn't," Milanesi said. "It's a service that focuses on a rich experience."

It's also part of Apple's underlying message: You get what you pay for. And, according to Apple, part of what you're paying for is the right to keep your information to yourself.