The point isn't the reason for the diversion, the point is that a diversion indicates a supply shortfall relative to demand.
Here is some more info from MacWeek on the P1 rumors
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Tuesday, June 22, 1999
P1 woes for Apple?
By Elliot Zaret, MSNBC (ZDNN)
One of Apple's key new product lines -- the consumer PowerBook, or P1 -- is in danger of being scrapped by the company because of serious engineering concerns that are hampering its operating ability, sources said.
Over the weekend, top Apple executives held a secretive meeting to vote on the fate of the computer -- one of the cornerstones of Apple's future strategy. The question was whether the product should be delayed, or scrapped altogether.
"More than one voted to scrap the product entirely," said Jason O'Grady, who tracks all news PowerBook-related on his PowerPage Web site, citing an Apple source familiar with the details of the meeting.
Apple isn't officially releasing any details on either the meeting or the fate of the P1, saying only "We're just not going to talk about rumors or speculation."
But analysts say that the notebook, which Apple promised would be released in the "middle of 1999" -- and was expected to debut at July's Macworld Expo in New York -- is crucial to the company's strategy and revenue.
'Steve's gag order?'
"The financial markets have high expectations for this product," said Walter Winnitzki, senior analyst at Hambrecht and Quist. "It's already in the valuation of the stock."
Winnitzki said he spoke with a "financial contact" at Apple about the problem. The contact was very reluctant to discuss the matter, he said.
"It appears like everyone is under Steve's gag order there," Winnitzki said. "They're afraid to say anything."
That has certainly been the case recently as the company struggled with a number of internal problems -- first the month-long delay in shipping its higher-end PowerBook G3, and then last Friday's departure of a top PowerBook executive.
Three-legged strategy
The P1 was to be the fourth cornerstone in the foundation of Apple's plan to reinvent itself under Apple interim CEO Steve Jobs. With Jobs' guidance, Apple has been hailed for trimming its product line to four basic thrusts: the iMac for consumers and home use, the powerful blue-and-white G3 tower for high-end users like graphics professionals, the new PowerBooks for the executive on the go, and finally the P1.
While Apple has never officially released details of the computer, the P1 is widely expected to be to the laptop what the iMac was to the desktop -- cute and friendly on the outside and powerful on the inside. It is expected to sport a colored plastic case similar to the iMac and have a 300- or 333-MHz G3 processor inside.
Apple watchers expected the product to be the centerpiece of July's Macworld -- an announcement there would be like getting $1 million of free advertising, O'Grady noted. "That's why they moved it from Boston to New York," he said. "New York is the advertising capital of the world."
But engineers recently discovered a problem with the computer's application-specific integrated circuits (ASICs) that will keep it from being ready in time, according to O'Grady.
"It's just not running, and they don't want to show it (at the Expo) and build expectations until it's ready," he said.
Conference in Cupertino
The weekend meeting at Apple's headquarters in Cupertino, Calif. -- which included Jobs as well as the P1's engineers and product line managers -- came on the heels of a flurry of problems for Apple centering on its new PowerBook G3.
Jobs announced at the May 10 WorldWide Developers Conference, that the higher-end G3 laptop would be in the hands of Apple's customers within 10 days. But the shipping date slid repeatedly, and Apple offered no explanation to thousands of customers who ordered the computer, nor to its retailers and catalog vendors.
To make matters worse, while retailers were being told that there were no PowerBooks available in America, Apple was selling them on its own online store. Apple Senior Vice President of World Wide Sales Mitch Mandich said that was merely an accident caused by "logistics," but to many retailers the damage had been done.
"I'm very frustrated by the lack of, and sometimes misinformation that's coming out of Apple," said one longtime Apple retailer who spoke on the condition of anonymity. "I don't know what to believe anymore."
By the time the PowerBooks began trickling out, the company decided to make an "organizational change in hardware" development. Apple Vice President of PowerBook Development Mark Foster was forced to resign after reportedly clashing with his superior, Apple Senior Vice President of Hardware Engineering Jon Rubinstein.
How deep do the problems run?
Apple, which would not comment on its reorganization, doesn't plan to replace Foster, but will instead combine the department with its desktop system engineering department, head up by Apple Vice President Glen Miranker, according to Doug Landry, editor of The PowerBook Zone Web site, who first broke the news of the shakeup. Under that scenario, Miranker will direct the design of all four Apple hardware lines, answering directly to Rubenstein.
The company has also been especially tight-lipped -- and has been unwilling to explain the situation to the public, its resellers or financial analysts -- something that has caused many to wonder how deep the problems run.
Winnitzki said he was able to get little information out of Apple. For instance, about Foster, his contact would only say that he was "re-orged out."
Winnitzki said his contact was a little more positive about the fate of the P1.
"They said they never committed to anything, but that it would still be ready to ship in the middle of the year."
The mid-summer shipping date was especially important in order to get the "back-to-school" sales, he said.
Louis Mazzucchelli, an analyst at Gerard Klauer Mattison & Co., said he can't imagine that Apple would abandon the project.
"I'd attribute a low probability to that -- it's an essential part of the strategy," Mazzuchelli said.
Mazzucchelli warned against getting too worried about a potential delay, noting that in the computer industry, "things always get delayed."
As for the meaning of Apple's re-organization, "you can argue both sides of this -- you can see this as a positive," he said.
"The product architectures are converging, so it doesn't seem you have to have so much distance between the desktop group and the portable group," Mazzucchelli said. |
