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Music servers and other computer based digital audio technologies.

RE: iOS 11 is rumored to play FLAC files

I think that you are right. Why would Apple want to expand the capabilities of their devices in order to allow the playing of music that certainly cannot have been purchased from Apple Music? Hardly in their commercial interests. Ideally I am sure that they would ultimately want only files purchased from Apple Music to be viable on their devices. OK I believe that there is a compromise that you can play files in Apple formats purchased from third parties. But I bet that mere fact grates at Apple HQ.

NB: All the pre-release stuff on iOS 11 relating to music that I have seen only refers to enhancing the use of Apple Music.

Meanwhile my year old Android phone can play FLAC files up to 24/192 (plus other formats) :-)

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