(Welcome to the World of Endless Reruns! A quarter of a century ago, As the Apple Turns (AtAT) was a daily web-based soap opera obsessively following the melodramatic ins and outs of all things Apple. Now the archives are broadcasting in syndication, so each day you can see what life was like 25 years ago when Apple was still the underdog, all in not-so-fabulous RetroVision™!)

TV-PGApril 15, 1999: So just how does Apple keep their internal inventory so low? Sorry, that's classified information. Meanwhile, Wall Street responds to Apple's most recent financial success with a big shrug and a noncommittal "Whatever..." while Apple considers pushing iMacs and iBooks through Sears...
There was no new episode broadcast on April 16, 1999, so we're still showing you the last episode broadcast before then. (April 15, 1999)
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Inventory Antics (4/15/99)

It's no secret that Apple's been on an inventory-reducing rampage for a while now, and we're starting to think that their behavior is bordering on the obsessive. Ever since Mike Dell publicly stated that if he ran Apple he'd shut it down and give the money back to the stockholders, we've suspected that Dell has been Steve Jobs' white whale. Since Apple can't even hope to compete with Dell's massive revenues and sheer volume of online sales (yet!), it seems that Jobs and company have made it a priority to beat Dell's on-hand inventory levels instead. Dell has traditionally been the best in the business when it comes to keeping inventory down, but last year they got bumped to second place when Apple took the lead. For instance, in the fourth quarter of 1998, Apple showed six days of inventory, beating Dell's eight. Last quarter, it was two days, beating Dell's seven. And according to a MacObserver article, for the second quarter just ended, Apple finished up with a staggering one day of inventory, while Dell still lags at six.

Now if you're wondering how any global computer company that sells millions of computers each year and brings in billions of dollars in revenue can finish a quarter with only one day's worth of on-hand inventory, you're not alone. Analysts asked Apple CFO Fred Anderson that very question during yesterday's press conference, but Fred pretty much kept mum, saying that Apple's "been trying to organize manufacturing facilities to be next to supplier facilities" but going no further, for fear of revealing "competitive trade secrets." That's good enough for the investors, who are just happy that Apple was able to pull it off-- according to Apple Insider, one guy even asked whether Apple's future on-hand inventory levels would be measured in "hours, minutes, or seconds."

So just what are these "trade secrets" that allow Apple to keep such lean inventory levels? We don't know, but we have our suspicions. For instance, we know that Apple's been in secret high-level talks with the Zeta Reticulans for a good long while now, set up by iMac designer Jonathan Ive. (You didn't seriously think he was from this planet, did you?) Seems the Reticulans were interested in studying Jobs' Reality Distortion Field for their own world-dominating needs, and were willing to trade a Faster-Than-Light assembly drive for the privilege. In fact, Apple's on-hand inventory is only as large as it is because suppliers can't get the raw goods to the plants fast enough-- but once the Reticulan teleport bays are up and running, Apple's internal inventory levels won't be measured in units any larger than nanoseconds. (We suppose the other possibility is superb organization, excruciating attention to detail, and lots of good old-fashioned elbow grease-- but we doubt it.)

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Old Habits Die Hard (4/15/99)

Does anyone else find it interesting that whenever Apple posts larger-than-expected profits, its stock price barely budges? In fact, in recent quarters, we've even become accustomed to seeing it drop a few percentage points. Call us naive, but we would think that when a company releases end-of-quarter financial information revealing a sixth consecutive Street-beating profit, a record inventory level, year-over-year growth twice that of the industry itself, and all sorts of other goodies, the stock price would go up. Not that we've ever claimed to understand the stock market, mind you, but that's just our gut reaction.

So even though financial information tends to make our eyes glaze over as our thoughts wander to the eternal question ("Which is a worse made-for-TV movie title, Atomic Train or Mother, May I Sleep With Danger?"), we were surprisingly unbored by a recent ZDII Inter@ctive Investor article about Apple's tough stock battle. Apparently the problem is that Wall Street analysts just won't upgrade their ratings on Apple not matter how well the company performs, due to lingering prejudices and what Steve Jobs called the "Hierarchy of Skepticism" last year. Where the analysts go, the stock prices follow, and many analysts irrationally rate AAPL low because Apple's a "niche play" and not a good bet in the "long-term." Which is particularly ironic, according to the author: "Analysts are asking about Apple's outlook in three years and then talking up .com companies, half of which will crash and burn in that same time frame." Perhaps these analysts are just holding a grudge, since Apple keeps beating their estimates?

Chalk it up to long-standing prejudices, then. Apple may have made huge strides winning back the heart of the media, but Wall Street's wearing PC-colored glasses. On the other hand, the latest RFI Report hints that Wall Street may just have to sit up and take notice with all the developments Apple's got up its sleeve for the rest of the year. There's QuickTime 4, Final Cut Pro, Mac OS X Server, new iMacs, new PowerBooks, the consumer portable, and a slew of other stuff that none of us knows about yet. Personally, we think Apple might benefit greatly from releasing some product that Wall Street analysts just couldn't ignore-- perhaps the rumored "Executive PowerBook" described at O'Grady's PowerPage is just what the doctor ordered.

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The i Side of Sears (4/15/99)

Every once in a while it's probably a good idea to take a step back and see how Apple's doing on the national retail outlet front. After Apple cleaned the slate a couple of years back, the sole remaining national retailer still allowed to sell Apple products was CompUSA. After a rocky start, most of CompUSA's bigger store-within-a-store problems seem to have settled down; sure, there are apparently still stores with no Apple-savvy personnel available (a blatant contract violation, we're told), and the continued omission of Macs and Mac-related software and accessories from the CompUSA Sunday circulars continues to rankle us like steel wool underwear, but for the most part things have improved. A lot of it comes down to who's running the Mac end of things at each particular store; there are some insanely great CompUSAs out there from a Mac perspective.

Then there's Best Buy. Wow, where to start... Put simply, the average iMac buying experience at Best Buy is akin to trying to wrestle a hunk of meat from a hungry tiger on speed-- you stand a slim chance of getting what you want, but the medical bills make it a hollow victory. Prospective iMac buyers were steered towards Wintels by untrained staff who openly bad-mouthed Apple on the store floor, prompting management to panic when they saw that, for some strange reason, they weren't selling as many iMacs as they'd hoped. Remember that panicked unloading of iMacs at $999 last year? And now there are still no fruit-flavored iMacs in Best Buy because they were squeamish about stocking five colors, and no one knows when they'll come back on board.

Let's hope Apple fares better with Sears, who, according to Apple Insider, is expected to sign back on with Apple to sell iMacs and the future consumer portable (now apparently officially dubbed the "iBook"). The rumors lack shape so far, but if Sears is really going to start selling Apple's consumer line sometime this summer, we'd have to say that MacWorld Expo seems like a natural time to announce the new alliance. That way, Sears could start selling iMacs immediately after the announcement-- and since the iBook will probably be released at the Expo as well, the timing's perfect. Can Apple avoid "Best Buy II"? We're keeping our fingers crossed...

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Previously, on As the Apple Turns...

TV-PGApril 14, 1999: Six for six-- this much street-beating black ink is almost boring, isn't it? Meanwhile, Apple's market share continues to climb, propelled by the continually-refreshed iMac line, as Apple trots out the fourth iMac model in eight months...

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