10.22.2007

                   
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Apple. Experiencing a Power Surge.



Since Steve Jobs returned for a second stint at Apple 10 years ago, the company has come up with consumer hits such as the iPhone (above) and the iPod. However, there were a few duds too. Remember the Cube? and how about Apple tv?

Regardless, the stock has increased over the past year (see below).


Mr. Jobs, who returned for a second stint as chief executive in 1997 after being away for a dozen years, may announce that annual sales surpassed $20 billion for the first time in the company's 31-year history when he reports results for the year and fourth quarter on Oct. 22.

And if Steve Jobs instincts are correct, I say get out there and buy some Apple stock, if you weren't savvy enough to do so already.

Below is an article reprinted from today NY Times:
By JOHN MARKOFF
Publishedin the NY Times: October 22, 2007
SAN FRANCISCO, Oct. 21 — It may have dropped the word “computer” from its name, but Apple is certainly selling plenty of Macs.

Driven in part by what analysts call a halo effect from the iPod and the iPhone, the market share of the company’s personal computers is surging.

Two research firms that track the computer market said last week that Apple would move into third place in the United States behind Hewlett-Packard and Dell on Monday, when it reports product shipments in the fiscal fourth quarter as part of its earnings announcement.

“The Macintosh has a lot of momentum now,” said Steven P. Jobs, Apple’s chief executive, in a telephone interview last week. “It is outpacing the industry.”

On Friday, Apple will start selling the new Leopard version of its OS X operating system, which has a range of features that in some cases match those in Windows Vista and in others surpass them.

Mr. Jobs said that Leopard would anchor a schedule of product upgrades that could continue for as long as a decade.

Above: The apple site has a live count-down until the release of the anxiously-awaited Leopard Operating System

“I’m quite pleased with the pace of new operating systems every 12 to 18 months for the foreseeable future,” he said. “We’ve put out major releases on the average of one a year, and it’s given us the ability to polish and polish and improve and improve.”

That pace suggests that Apple will continue to move more quickly than Microsoft, which took almost seven years between the release of its Windows XP and Windows Vista operating systems.


Above: Vista, Microsoft's more visual interface and operating system that debuted last year.

Vista has had mixed reviews, and corporate sales have been slow so far. Mr. Jobs declined to comment on Microsoft’s troubles with Vista, beyond noting that he thought Leopard was a better value. While there are multiple editions of Vista with different features at different prices, the top being the Ultimate edition, Apple has set a single price of $129 for Leopard.

With Leopard, Mr. Jobs joked, “everybody gets the Ultimate edition and it sells for 129 bucks, and if you go on Amazon and look at the Ultimate edition of Vista, it sells for 250 bucks.”

Microsoft has said that it will release an update, or service pack, for Vista in the first quarter of 2008. But it has also said that it intends to offer a service pack for Windows XP in the first half of the year. That, analysts said, could further delay adoption of Vista as computer users wait to see how XP will be improved.

Microsoft has also hinted that its next operating system, code-named Windows 7, would not arrive until 2010. At Apple’s current pace, it will have introduced two new versions of its operating system by then.

Apple has not been flawless in its execution. Early this year, it delayed the introduction of Leopard for four months. Mr. Jobs attributed this at the time to the company’s need to move programming development resources to an iPhone version of the OS X operating system.

Several analysts said they thought that Leopard would have only an indirect effect on Macintosh sales.

As for Vista, it has clearly not pushed up demand for new PCs as much as computer makers hoped. Last week, the research firm Gartner said PC shipments in the United States grew only 4.7 percent in the third quarter, below its projection of 6.7 percent.

That contrasted sharply with Apple’s projected results for the quarter. Gartner forecast that Apple would grow more than 37 percent based on expected shipments of 1.3 million computers, for an 8.1 percent share of the domestic market.

Apple has outpaced its rivals in the United States, particularly in the shift to portable computers. While this is the first year that laptops have made up more than 50 percent of computer sales in this country, Mr. Jobs said that two-thirds of Apple machines sold in the United States are now laptops.

Apple has also outperformed rivals in terms of market share by revenue, because its machines are generally more expensive.

According to Charles Wolf, who tracks the personal computer market in his industry newsletter Wolf Bytes, Apple’s share of home PC revenue in the United States has jumped in the last four quarters. In the second quarter, for example, the Macintosh captured a 15.8 percent share, almost double its share of the number of units sold.

He added that Apple had a significant opportunity now in terms of visitors to its stores. Apple is now reporting 100 million annual visitors, and Mr. Wolf estimated that 60 million to 70 million of them were Windows users drawn by the iPod or the iPhone, who could potentially shift to Macs.


Above: A typical in-mall apple store

Although Apple may be able to grow briskly by taking Windows customers from Microsoft, the two companies face a similar problem: the industry is maturing and there have been no obvious radical innovations to jump-start growth.

Indeed, many of the new features in the Leopard operating system version are incremental improvements. But Mr. Jobs said he was struck by the success of the multitouch interface that is at the heart of the iPhone version of the OS X. This allows a user to touch the screen at more than one point to zoom in on a portion of a photo, for example.

“People don’t understand that we’ve invented a new class of interface,” he said.

He contrasted it with stylus interfaces, like the approach Microsoft took with its tablet computer. That interface is not so different from what most computers have been using since the mid-1980s.

In contrast, Mr. Jobs said that multitouch drastically simplified the process of controlling a computer.

Above: Apple's iphone

There are no “verbs” in the iPhone interface, he said, alluding to the way a standard mouse or stylus system works. In those systems, users select an object, like a photo, and then separately select an action, or “verb,” to do something to it.

The Apple development team worried constantly that the approach might fail during the years they were creating the iPhone, he said.

“We all had that Garry Trudeau cartoon that poked fun at the Newton in the back of our minds,” he said, citing Doonesbury comic strips that mocked an Apple handwriting-recognition system in 1993. “This thing had to work.”

1 comments:

Nicole said...

Makes me want to cry. The stock was 12 flipping dollars when I worked at their PR agency repping them. TWELVE. DOLLARS. My then husband didn't want to buy the stock because they were a "niche" company. I told him he was crazy. I was the one who was crazy for not ignoring him and buying it anyway! UGH!

C'mon people, it's only a dollar.
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