Snapchat and Instagram are hugely popular, and Apple wants to accommodate this sort of casual sharing in its own software. Bloomberg says it's being developed as a standalone app, but could end up as a feature in the existing camera application. The report has stressed, however, that the app may never see the light of day. Apple has killed projects before while they were still in development, and could do the same here if the app doesn't meet its expectations. The team is said to be striving for a 2017 release, and any delays could also result in its cancellation.
Bloomberg's report also mentions an improved "proactive assistance" feature which, separate to the new video app, would help people to stay in touch with their closest friends and family. The company is trying "to make sharing and connectivity with contacts a system-wide feature," the publication writes, and would include "single panels" where you could review all of your texts and emails from a specific person. Its release is dependent on approval from Apple's internal privacy team, however.
Apple's challenge is to develop software that's relevant and appealing to iPhone users. The company has long-struggled to build market-leading applications and services -- it's why most people stuff the pre-installed iOS apps into a folder (or, now, remove them from their device entirely.) Hardware is but one piece of the smartphone puzzle -- to keep millions of people smitten with the iPhone, it needs to build compelling apps too.