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  • The Apple Hardware Report: Doing the Unthinkable

    October 8th, 2005

    Turn back the clock to the fall of 2004. Now consider the events that most of you would have regarded as impossible then or ever. I have to say that the things I took for granted about this tiny corner of the universe were also turned topsy-turvy, which is why I never claim to have any great powers to predict the future.

    Remember when Apple delivered its financial report for the quarter ending September 30, 2004? During a conference call with analysts, it was made perfectly clear that Apple had no intention of entering the cheap PC market. Now to be fair, I was one of the folks who suggested what I called a “headless iMac,” and some others chimed in with their own variations on the theme, but few took us seriously. In January, Apple changed its tune, although the Mac mini might be regarded more of a “headless iBook” when it comes to the internal components it used. No matter, did you ever expect to see a $499 personal computer from Apple?

    So were Apple’s executives lying? Maybe, although one has to be cautious when speaking to the financial community. Perhaps the decision to go ahead with the mini hadn’t been made yet, even though it and other products you’d never expect to see were being tested in the development labs.

    In January 2004, Steve Jobs told us why Apple didn’t intend to build a Flash-based version of the iPod. You had to believe what he says, sitting there immersed in his famous reality distortion field. Now maybe the iPod shuffle wasn’t a glimmer in his eye at the time, or maybe Jobs felt that Flash memory was too expensive at that time to deliver a product with decent storage capacity at an affordable price. How things changed! The analysts are now predicting that Apple will sell more music players with Flash memory than hard drives in 2006. Doesn’t seem likely? How about the statistics that only 20% of iPod users really have more than 1,000 songs to store on their players? Bear in mind that you will likely see 6GB and 8GB versions of the nano next year, maybe even models with greater capacity. At what point does the hard drive no longer matter?

    Now segue to 2005 and the story in The Wall Street Journal a few days ahead of the WWDC, that Apple planned to announce a switch to Intel processors. Now if the story originated at one of those rumor sites, you’d feel confident to dismiss it as a fantasy. It strained logic. After years of proclaiming the PowerPC to be far superior to the Pentium, how could Apple dare change its tune?

    When the official word came down, though, I felt it was a perfectly logical decision, one that any smart executive would make. The arrival of the promised Power Mac with a 3GHz G5 was a year late and counting, with no immediate resolution. A PowerBook G5 represented “the mother of all thermal challenges,” and you can easily suspect that sales were lost as a result. All right, so maybe IBM will deliver a lower power G5 soon, and maybe there will be that dual-core G5, but the latter tops out at 2.5GHz. It’s not that Apple went to Intel with hat in hand, but I’m sure the promise of a reliable source of powerful chips that didn’t require nine fans and liquid cooling to tame was too attractive to pass up.

    Of course that’s not all. Would you believe, a year ago, that Apple’s share of the PC market would be on the rise? You could hope, you could dream, but the sales figures had been stagnant for so long, you could only feel grateful how much the iPod contributed to the bottom line and hope, if you’re a fan of Apple that those iPod killers wouldn’t take hold.

    Sure enough, whether the iPod halo effect, disgust with the endless tribulations of the Windows platform, or a combination of the two, it’s hard to take anyone seriously who says Apple is irrelevant these days. There are lots of new Mac users out there, and if Apple can avoid too many serious operating system bugs and hardware defects, maybe they’ll stick around. Even better, maybe they’ll tell their friends.

    In fact, switcher stories among the technology press are more and more common. The usual scenario is that the writer is a died-in-the-wool Windows user who decides that he or she has had enough grief. They buy a Mac, or get one on loan for a month or two from Apple. Over the next few weeks, the Windows box is used less and less and soon is limited to running applications that have no Mac equivalent. Or, perhaps, accessing certain Web sites whose designers can’t see the forest from the trees and imagine total compatibility with Internet Explorer is sufficient to reach everybody.

    Yes, a lot of things have occurred over the past year that you would never have expected, but it’s not over yet. Far from it.



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