TV-PGJuly 16, 2002: Apple hits the analysts' estimates-- just barely-- amid a slew of slightly worrying declines in revenue, gross margins, unit shipments... you name it. Meanwhile, Microsoft looks to spoil the Macworld Expo fun by pre-announcing products months in advance and making noises about abandoning the Mac platform, and rumors continue to swirl about the imminent introduction of an Apple-branded personal video device tomorrow, but we wouldn't get our hopes up too high if we were you...
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The Expected Profit, But... (7/16/02)
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Welp, the numbers are in-- and surprise of surprises, Apple didn't totally leave a big, smoking crater where its solvency once was! According to the official press release, the company scored a quarterly profit of $32 million, directly in line with the analysts' expectations. Of course, those are the revised expectations that had been pummelled southward by that scary earnings warning last month, but hey, who's counting? Apple hit its (new) numbers, and that's a reason to celebrate. Go have a Popsicle or something.

Unfortunately, it's not all sunshine and lollipops. Apple had raked in twice that much profit a year ago, revenues are down 3%, unit shipments are down 2%, and gross margins just got a little less gross-- 27.4%, down from 29.4% last year. And if you tune in to the QuickTime rebroadcast of the analyst conference call, you'll hear some other disturbing numbers: units and revenue are down something like 25% in Europe and Japan; education sales are down 17%; retail is still losing money ($6 million this quarter); and the company was "surprised and disappointed" by lousy sales of iMacs, PowerBooks, Xserves-- heck, pretty much everything but the iBook. In fact, just about the only good news is that Apple still has $4.3 billion in cash and plans to toss some of that green around by buying some more strategically useful companies. Oh, and there's also the fact that Apple still managed to crank out cool products and sell enough of them to make a profit. Sometimes it's easy to forget that in this market, that's a pretty impressive feat in and of itself.

Unfortunately, Wall Street isn't particularly concerned with looking for the silver lining right now, and Apple's stock price is down about a buck and a half in after-hours trading-- meaning that, for the first time in a long time, the AtAT staff is actually losing money on our AAPL holdings. Consternation! Uproar! We're not exactly jumping out the window just yet (we're on the ground floor, anyway), but for the sake of the college fund of a certain little Goddess-In-Training we know, here's hoping that whatever Uncle Steve has jammed up the sleeves of his turtleneck for tomorrow's keynote, it's spectacular enough to give AAPL a much-needed boost.

Oh, but speaking of unbounded optimism and taking the glass-half-full approach, we've got at least one more bit of good news to come out of all of this: faithful viewer Doug Barth is the Big Winner of this quarter's Beat The Analysts contest. For being the first to guess Apple's $32 million profit on the nose, Doug's going to get his choice of receiving either a free AtAT t-shirt or a dusty piece of shrink-wrapped software from our infamous Baffling Vault of Antiquity™. So congratulations to Doug, and remember, everybody: no matter how poorly Apple does in any given quarter, the bright side is that somewhere out there, some happy AtAT viewer will either receive a new game for his or her IIsi, or he or she will get to put off doing laundry for another day. See? It's all good.


 
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Microsoft: Party Poopers (7/16/02)
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This is it, people: Keynote Eve. This is the night when all good little Mac enthusiasts drift off to sleep with visions of 20 GB iPods dancing in their heads, as they pray that Santa Steve won't pass them by just because they were once careless enough to ponder the plausibility of an iMac with a 17-inch screen without first taking the precaution of donning a tinfoil hat to block Steve's thought-reading wavelengths. But any Mac users who aren't silently spirited away in the night by Apple's elite Anti-Speculation Blacklist Enforcement Unit will doubtless enjoy the heck out of themselves come tomorrow morning, when Steve takes the stage, works his mojo, and unveils wondrous gifts for everybody. Well, everybody with a decent credit rating and some disposable income, anyway.

So leave it to Microsoft to cast itself as the Macworld Grinch, looking to step all over everyone's buzz. You may have noticed that the long-running MPEG-4 licensing tussle was finally just resolved, with MPEG-LA apparently agreeing to institute a flat-fee licensing option and waive fees entirely for broadcasters with fewer than 50,000 subscribers a year. Not at all coincidentally, QuickTime 6 is now (finally!) officially out, and we expect that snazzy demos of the new media architecture will figure heavily in the Stevenote. So what did Microsoft do? Well, according to CNET, on the very same day, Redmond launched a press salvo about Windows Media 9 Series, its own next-generation media architecture. Subtle, no? And isn't the timing of the announcement interesting, considering that Windows Media 9 won't even hit the public beta stage until September 4th? Hmmmm...

But wait, it gets better. Everyone knows that Jaguar, the upcoming release of Mac OS X that will probably wind up being branded 10.2, will almost certainly chew up a ton of screen time during the Stevenote; since it's due in "late summer," the odds are pretty good that Steve will even dish us up a solid release date. If 10.1 was the update that made Mac OS X usable, Jaguar is the one that will make it positively sparkle. It's a big deal. And what does Microsoft do in these days just prior to Jaguar's release? Why, according to faithful viewer iconmaster, it goes blabbing to the Wall Street Journal about how it needs to "reassess whether to continue doing business with Apple." According to the WSJ, Microsoft "blames Apple" for weak sales of Office v.X, citing the lack of a "concerted effort to promote Mac OS X." Because of this, Microsoft actually hints that it might bail on the whole Office v.X thing in 2004-- unless sales pick up.

Pssst... hey, Redmond... if you want to sell more copies of Office, here's a subtle clue: try making it cost less than a complete deluxe Whirlpool dishwasher. Or are you, as the conspiracy theorists opine, intentionally pricing it out of the market to give you an excuse to stop supporting a competing platform? Because we really just have to wonder about a company who can't understand why people who are struggling to shell out $1099 for an entry-level eMac aren't then plunking down an extra half a grand for a second productivity suite (AppleWorks being included). If this professed disappointment in the sales figures isn't due to utter cluelessness and being profoundly out of touch with the average consumer bank balance these days, then it's all part of a fiendishly clever and sinister plot to terminate the Mac platform by 2007. Or something.

But we digress, albeit slightly. For what it's worth, faithful viewer David Hansen notes an eWeek article in which Apple's Phil "The Man" Schiller goes on the defensive, noting that 10% of Apple's installed base is now running Mac OS X, with 20% targeted by the end of the year; Microsoft making vague threats and sowing the seeds of doubt about Apple's future (and thinly disguising it all as "concern") just prior to the Expo... it's just so predictable, isn't it? You have to respect a company who always acts in character. Between the timely Office threat and the QuickTime thing, does anyone else get the feeling that Microsoft is maybe feeling a mite... nervous? Or at least miffed about this whole "Switch" campaign. One thing's for sure-- relations between Apple and Microsoft have definitely been better. It's going to be interesting to see how this whole thing heats up. We'll be over here, huddling in this trench.


 
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iTiVo and Wishful Thinking (7/16/02)
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So what does Apple have waiting in the wings for tomorrow's shindig? Well, there's been a lot of reasonably believable speculation flying around out there, with stuff about 17-inch iMacs, 20 GB iPods, iTools turning into ".Mac," a solid Jaguar release date, and more. So far, though, we haven't heard much about anything in the works that'll knock our socks halfway to next Thursday. About the closest we've come to nudging our needle from "Jaded" into "Intrigued" territory comes from a couple of whispers floating around following hot on the heels of a nifty new device that was just introduced yesterday-- but not by Apple.

Longtime viewers already know that the AtAT staff are total freaks for TiVo, that wonderful device and service that lets us, for example, sit down at 4 AM and watch six straight episodes of Daria sans commercials while wolfing down a whole pint of Cherry Nirvana should the mood strike us. So when El Gato introduced the EyeTV yesterday, we thought it was kind of cool that a TiVo-like personal video recorder has finally come to the Mac. With EyeTV, you can record shows straight to your Mac's hard disk, burn them to CDs, etc. Similar products have been around for Wintels for a while, and it's nice to see the gap start to close.

Now, personally, we're not entirely sure how useful we'd find this particular device, since we like to watch our TV on the TV and not on the Mac, Cinema Display notwithstanding. But we admit that it'd be nice to be able to archive MPEG-1 versions of some recorded content, and doubtless some people are just going to be all over this thing. That is, provided Apple doesn't come out with its own personal video recording device tomorrow. There have been low-key and occasionally semi-believable rumors about an Apple set-top box for donkey's years, now-- stretching all the way back to that whole "Columbus" media fiasco and even further. And Apple has definitely done work on TV-related devices in the past; remember the PiPPiN? Or the "Weird Mac Thing"? So now the latest rumors (which, incidentally, don't stray too far from the last iteration spotted at Mac OS Rumors) claim that Apple has a standalone TiVoesque system in the works, which not only records video, but also allegedly includes a radio tuner and, accordingly to some sources, your choice of a CD-R or DVD-ROM drive, presumably to play DVDs and/or audio CDs and possibly burn recorded video to archive discs. It sounds a little sketchy, sure, but the claim that this sucker has a FireWire port and can output video in real-time to an attached Mac would make for a kinda nifty feature.

To be honest, we're not throwing a lot of faith behind this one (read: almost none), largely because we know how Steve feels about television in general and, more specifically, how he feels about the convergence of TV and computers. (In short, he's not amused.) There's also the pretty damning fact that Steve himself has, uh, flat-out said that Apple has no plans to do a personal video device for at least the next year and a half, so these rumors of an imminent unveiling are most likely just hoaxes. But even though rumors of the Apple PVR are rarely spotted in the wild (and when they appear, they tend to contradict each other on the details), Apple is shooting for that whole "digital lifestyle" thing, and it's not completely absurd to think that television fits in there somewhere alongside desktop video and home DVD authoring. So if Steve actually does trot out some sort of iTiVo tomorrow, a couple of years ahead of schedule, we'll be plenty surprised-- but maybe not as surprised as we could be. Now, gangway-- we've got three hours' worth of "Six Feet Under" to plow through before bedtime. Where's that remote?


 
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