Has Apple turned the corner at last? Leander Kahney sees Mac fans swoon in the face of the greatest showmanship
The 2 500 Macintosh devotees who packed the opening session of Macworld Expo in New York earlier this month were expecting Steve Jobs, Apple Macintosh’s acting chief executive, to deliver a short pep talk via satellite. Apparently Jobs couldn’t make the trip from California and another top executive was due to give the keynote speech instead.
But while everyone’s attention was directed to the giant television screens on either side of the stage, a familiar figure with a sly smile strode confidently from the shadows. It was a clever trick. When the audience realised that Jobs had appeared in person, they went bananas, jumping from their seats and punching the air in triumph.
Jobs then gave a detailed, two-hour analysis of the state of Apple’s health. And, he said, it isn’t too bad.
The company last week reported its third consecutive profitable quarter, the first string of profits it has seen for more than two years. But, more importantly, Apple next month will start selling one of the most hotly anticipated high-tech products in recent memory: the iMac, a hip new desktop machine for home users with a head-turning translucent blue case and a very fast chip inside. The iMac, Jobs said, will be key to Apple’s future.
Apple’s fall from grace has been surprisingly rapid. Just three years ago it was the biggest maker of personal computers in the United States, with about 13% of the North American market. Ironically, its size was its downfall. The company became bloated, and over-stretched its reach. It started to lose money: $1,8-billion in two years, and with it went customers, market share and confidence. Today, Apple’s US market share stands at about 4%, while 1998 revenues will be about half of what they were in 1995.
During his keynote speech, Jobs presented the case that Apple has finally bottomed out of its “death spiral”. His argument revolved around a number of recurring criticisms of the company: it’s doomed, it’s unstable, it has a confusing and unpopular line of products and no one else in the industry is interested in developing Mac products.
Those criticisms are just no longer true, Jobs said.
Since taking over a year ago, his new management team has made a host of operational improvements, including launching a successful online store and a high-profile advertising campaign. Staff migration has been stemmed and the company has a line of products that are selling well. Apple has been making a profit for the past nine months, Jobs noted, and its market value has more than doubled in a year.
Things will continue to improve, he insists.
In recent months, the computing world’s attention has been on Windows 98, but Apple’s operating system is also scheduled for an upgrade.
Mac OS 8.5, code-named Allegro and due this September, was given a brief and limited demonstration at the show. Jobs and his marketing chief, Phil Schiller, described Allegro as the most significant upgrade to the Macintosh operating system in years, even more significant than the jump from System 7 to System 8.
Their enthusiasm for Mac OS 8.5 is evidently based on more than just the two new features they selected to show to the audience: an impressive new engine for finding information on the computer’s hard disk and on the Internet, and a feature that allows rapid transfers of large multimedia files over computer networks.
The Mac OS 8.5’s information searching feature, called Sherlock, replaces the feeble file-finding utility in the current Mac operating system, and instead of searching for file names, it allows users to search for content inside documents, using natural-language queries. The new search engine can also scan the World Wide Web.
Next year, Apple will launch a new portable computer for consumers and Mac OS X, its next-generation operating system. But it is the iMac on which Apple is pinning its hopes in the rapidly expanding consumer sphere. “This is where we see growth for ourselves,” Jobs stated. “We’re going to do it with the iMac.”
Jobs said anticipation of the machine’s success is already generating a number of positive effects. He showed the range of hardware that has been announced for the iMac, including printers, scanners, removable hard drives and digital cameras, some of which will match the iMac’s translucent case with their own see-through plastic shells.
Software publishers are also jumping on to the bandwagon, Jobs added.
The head of Microsoft’s Macintosh development group vowed that never again will Microsoft treat the Macintosh as a second-class citizen by simply retooling Windows programs to run on the Mac OS. Microsoft, which is the second-largest publisher of Mac software after Apple, previewed some of its most important applications – the Office suite and Internet Explorer – with features exclusive to the Mac versions.
Among the products and programs coming to the Mac in months ahead are the popular Tomb Raider games that star the virtual celebrity Lara Croft, the disk- based version of the Encyclopedia Britannica and Disney Online’s popular Blast website for children. Disney hopes the Mac version, currently being tested, will make a big blast in US schools, where the Mac is still the dominant platform.
In addition to Microsoft and Disney, Jobs said that since the iMac was introduced in early May, software developers have announced plans to publish 177 new titles, including lots of games, which will be crucial to attracting home users.
The combination of the Internet and gaming will help fuel the iMac’s success, said Stephen Judd, an attendee from Siemens’s research laboratory at Princeton, New Jersey.
Additionally, said Judd, Apple’s lead in colour technology will help it as a platform for Internet commerce, in which colour fidelity will be key, and the superiority of the Power PC processor over Intel’s chips will continue to widen.
Additional reporting by The New York Times