Where does Apple
want to go tomorrow?
Was Jobs dropping hints?
By Rebecca Lynn Eisenberg,
CBS MarketWatch
Last Update: 4:12 PM ET Jan 9, 1999
NewsWatch
SAN FRANCISCO (CBS.MW) -- Now that Macworld Expo --
the favorite ritual bonding event of all Apple fans -- is over, and
the reality-distortion field is starting to fade, it's a good time to
ask: What is in store for Apple Computer?
Some people say Apple (AAPL) is a hardware company. It
makes good-looking -- multicolored, even! -- computers that do
most things people want them to do. And now that Apple has
"gotten its act together with regard to 3D graphics," to quote John
Carmack, co-founder of Id Software and cult-hero developer of
the wildly popular games Doom and Quake, Apple even makes
hardware on which people can play games. That is good for
Apple. And it's about time.
On the other hand, Apple is a software company. Despite the five
fruity flavors of the iMac computer and the Star Trek
door-enabled slick design of the new desktop G3 machines, the
Apple products that differentiate it from other computer
companies are its software products, because it is the software
that defines the user experience.
In other words, when a computer user fires up her Macintosh,
what she does on it is determined by the operating system -- say, MacOS 8.5.1-- and by the
applications she runs on it -- say, a PlayStation CD that she is able to use because she has
installed Connectix's new PlayStation-emulating software.
Both of these have something in common, though. They are geared toward the consumer.
The simplicity standard
So, it seems, what Apple wants to be is a consumer company. And consumers don't care
about hardware and software per se. Consumers care about electronic appliances that look
good in their living room, go on with a press of a button, are affordably priced and don't
crash. (Think: TV and phone.)
Whether you look at PCs from Dell running Microsoft Windows, Macs running MacOS, or
Sun workstations running Solaris, computers aren't there yet.
This shouldn't be surprising. It takes longer for consumer technologies to get to market than it
does for high-end technologies. Color television is a good example. It took about 25 years for
the color TV to progress from ridiculously expensive to a point where virtually every family
has at least one. That is because consumers don't want to buy a new TV (or computer) every
year or two. And they don't want to have to reboot.
But people want computers to be a consumer commodity. People want them to be cheap, and
stable, and run all of their games, and even access TV -- even though no one knows yet how
such content is to be broadcast or distributed. For all the talk about the "broadband
revolution," it's not here yet.
An interesting position
That leaves Apple in an interesting position. It has managed to design computers in a way that
consumers actually want to have them in their living room, but it doesn't yet sell them at a
price that all consumers can afford.
It is creating interesting ways to solve the broadband problem in the short term, such as
streaming QuickTime, which, as anyone who saw Steve Jobs' keynote on Tuesday can
vouch, is here already. Since QuickTime is the multimedia standard used in many DVD
movies and other entertainment, and since QuickTime is cross-platform (at least for both
consumer platforms, Windows and Mac), Apple seems well-positioned.
After all, what good will either RealNetworks (RNWK) or Microsoft be when broadband
comes around and streaming is not necessary? And where will desktop applications makers
like Microsoft be when people don't need to store anything, be it applications software or
multimedia content, locally? TVs don't store anything locally, and neither will the consumer
computers of the future.
Mac on track
Apple is on the right track, but still not there yet. It is making machines that do what
consumers want to do and look the way consumers want them to look. The iMac, as Jobs
demonstrated, works as a network computer, accessing multimedia content through a network
and playing it locally. And Apple is coming out with digital video editing software (Final Cut)
to allow consumers to plug their camcorders directly into their computers to edit home movies
(a favorite activity for many consumers).
Apple may have to go the route of Sony Corp. (SNE), which reinforced and extended its
strength in the electronics market by branching out into the business of creating the content
that its electronics create and deliver. What Sony realized was that a company that both creates
the entertainment itself and the hardware that delivers it enjoys a market advantage more
powerful than the sum of the parts.
Perhaps Jobs had a Sony-like plan in mind when he purchased his "other" company, Pixar
Animation Studios (PIXR). And perhaps the numerous Disney logos (including "Mulan"
graphics and an Infoseek icon) that kept popping up during Jobs' keynote presentation can
similarly offer clues as to where Apple is next headed.
However you slice it, one thing seems clear: Steve Jobs is a masterful showman, and, true to
its co-founder and iCEO, Apple's strength, past present and future, lies in the land of
consumer entertainment. And perhaps that makes it, as much as I hate to admit it, a good
buyout target for Disney. Owned by Disney (DIS), Apple could sell those iMacs cheaply
enough for all consumers to afford |
