[IP] more on next obvious question

[David Farber <dave@farber.net>]

Begin forwarded message:

From: "CONNIE GUGLIELMO, BLOOMBERG/ SAN FRANC"  
<CGUGLIELMO1@bloomberg.net>
Date: June 6, 2005 6:43:49 PM EDT
To: dave@farber.net
Subject: Re: [IP] next obvious question


     Apple's support for Intel chips doesn't mean consumers will
be able to run the Mac system software on existing Intel-based
PCs or that PC makers will be able to make Intel-based computers
that can run Mac programs, Philip Schiller said, Apple's senior vice  
president
of worldwide product marketing, said in an interview today.
     The Mac operating system will run on ``Macs that have Intel
chips in them, not on generic PCs,'' Schiller said.

   here's the complete story from Bloomberg.
 Apple Will Use Intel Chips to Win Sales, Jobs Says (Update5)

By Connie Guglielmo and Ian King
     June 6 (Bloomberg) -- Apple Computer Inc. Chief Executive Steve  
Jobs said
the company will switch its computers to Intel Corp. chips, a sign he  
plans to
sell cheaper laptops and extend gains in market share.
     Jobs showed a prototype computer using an Intel chip today at  
an Apple
developer show in San Francisco. Intel chips will debut in Apple's  
Macintosh
personal computers starting by June 2006, and all Macs will use Intel  
by the end
 of 2007, he said.
     The shift would help Jobs court laptop buyers, a market that's  
growing more
 than three times faster than desktop PCs. Intel chips cost less,  
run faster and
 generate less heat than the products built by Motorola Inc. and  
International
Business Machines Corp. that Cupertino, California-based Apple has  
relied on for
 21 years.
     ``The main motivation is more and better processor choices,'' said
Jean-Louis Gassee, who oversaw Apple's products and research-and- 
development
efforts from 1981 to 1990. He's now a venture capitalist at Allegis  
Capital in
Palo Alto, California.
     Using Intel chips may enable Apple to make ``smaller, lighter  
laptops'' and
 ``more macho higher-performance laptops'' than possible with IBM  
and Motorola's
 chip business, spun off as Freescale Semiconductor Inc., Gassee  
said. That's
because the processors create less heat and require less cooling,  
making it
easier to build the slimmer styles consumers prefer.

                          Recent Gains

     The faster speeds may help build on Apple's recent gains in  
market share.
Shipments of Apple PCs surged 45 percent in the U.S. in the first  
quarter,
spurring the biggest market share gain in five years, as the success  
of its iPod
 music players drove new Mac purchases, according to researcher  
Gartner Inc.
     ``The need to do this today is because we want to begin a  
transition for
the next couple of years and we want to get our developers started,''  
Philip
Schiller, Apple's senior vice president of worldwide product  
marketing, said in
an interview. ``This is about products we envision sometime down the  
road that
are only possible for us to make on a microprocessor architecture  
like Intel.''
     Apple resisted moving to Intel in the past and turned to  
Motorola and IBM
for chips to help combat sales lost to ``Wintel'' systems, Intel- 
based PCs
running Microsoft Corp.'s Windows. Apple calls its new PC design  
``Mactel,''
Schiller said.

                            `Like Us'

     ``They're kind of like us,'' Jobs said today. ``They're an  
engineering
culture that's passionate about the products. We haven't always  
viewed them that
 way, but that's what we found.''
     Apple's support for Intel chips doesn't mean consumers will be  
able to run
the Mac system software on existing Intel-based PCs or that PC makers  
will be
able to make Intel-based computers that can run Mac programs,  
Schiller said.
     The Mac operating system will run on ``Macs that have Intel  
chips in them,
not on generic PCs,'' Schiller said.
     Not everyone will greet the move to Intel with enthusiasm, said  
American
Technology Research analyst Shaw Wu in San Francisco. Since Apple  
marketed its
Mac operating system and PowerPC chips as superior to Wintel, Apple  
may alienate
 some customers, Wu said.
     Intel chief Paul Otellini remarked on that sentiment at the  
show today,
saying ``I suspect there's a whole bunch of you who never thought  
you'd see this
 logo on this stage.''

                          More Prudent

     Mac's success is key. The company in April had extra iPod  
inventory for the
 first time, said Piper Jaffray & Co. analyst Gene Munster in  
Minneapolis.
Shipments of the player, Apple's fastest-growing product, may be  
little changed
or decline this month, Mac News Network's AppleInsider.com said last  
week.
     ``Apple is now at a position where they're going to have to wow  
people,''
said David Nolan, who manages the $129 million BB&T Mid Cap Growth  
Fund in
Charleston, West Virginia. The fund owns Apple shares. ``Investors  
are being
more prudent.''
     More than 3,800 developers came to the conference, probably the  
largest
attendance in the past decade, Jobs said. The two top software  
developers for
the Mac, Microsoft and Adobe Systems Inc., today said they'll make their
programs run on Intel-based Macs.
     Apple, ranked fifth in U.S. PC sales, boosted its market share  
to 3.7
percent in the first quarter from 2.6 percent and trails No. 1 Dell  
Inc. by 28
percentage points. Every point Jobs picks up in PC market share means  
about $2
billion in revenue, JPMorgan Chase & Co. analyst Bill Shope in New  
York said.

                           Price Cuts

     Jobs, 50, is courting customers turned off by Apple's higher  
prices and
attracted to less-costly Wintel systems. Using Intel may eventually  
allow Apple
to cut prices 10 percent to 20 percent, UBS AG analyst Ben Reitzes said.
     Cnet Networks Inc.'s News.com, the Wall Street Journal and the  
New York
Times reported the agreement in the past three days.
     Sales to Apple had been declining and were about 3 percent of  
revenue,
Freescale Chief Executive Michel Mayer said in an e-mail to employees  
today.
     IBM will continue development of the Power chip for use in game  
systems
made by Sony Corp., Microsoft and Nintendo Co., the company said in  
an e-mailed
statement.
     ``IBM is focused on the highest value opportunities in each  
marketplace,
and our direction with the Power Architecture is consistent with that
strategy,'' the company said.
     Shares of Apple fell 32 cents to $37.92 at 4 p.m. New York time  
in Nasdaq
Stock Market composite trading. They have surged 18 percent this year  
after
tripling in 2004. Sixteen analysts suggest buying shares, seven  
recommend
holding them and none says investors should sell.

                            Centrino

     Santa Clara, California-based Intel, the world's biggest  
semiconductor
maker, introduced a chip package for laptops in March 2003 called  
Centrino. By
combining a special chipset, processor and radio, Intel offered  
consumers longer
 battery life, increased performance and wireless high-speed Internet
connectivity.
     ``They are trying to push into what's called the digital  
home,'' said Bill
Gorman, a technology analyst for PNC Advisors in Philadelphia. The  
firm owns
11.5 million Intel shares, 3.9 million IBM shares and 72,000 Apple  
shares. ``The
 partnership with Apple could be a step in that direction.''
     The current Mac OS X operating system software has been built  
to work with
Intel chips for five years, Jobs said. The program is based on  
software for NeXT
 Computer Inc., a company Jobs founded that moved its operating  
system to Intel
in 1993.

                            `Rosetta'

     Apple is developing software called ``Rosetta'' that will allow
PowerPC-based Mac programs to run on Intel-based Macs, Jobs said.  
Rosetta will
let users run current Mac programs until software developers rewrite  
their
products for the Intel chip.
     Apple says 12,000 programs work with its current operating  
system, compared
 with more than 100,000 for Windows.
     Apple has delivered 2 million copies of the latest version of  
OS X, dubbed
Tiger, Jobs said. The company is working on a new version called  
Leopard that
will come out in late 2006, just as Microsoft introduces the next  
version of
Windows, Jobs said.
     Jobs also said Apple is adding ``podcasting'' audio reports  
that users
download from the Web into its iTunes music software for the iPod.  
Users will be
 able to search, download and subscribe to the more than 8,000  
podcasts from
amateur reports and major news sources such as National Public Radio.


----- Original Message -----
From: David Farber  <dave@farber.net>
At:  6/ 6 15:32

What will Apple do to stop me from using the Apple enviroment on  say
a  ultralight Sony. They could become a software only comapny or they
could try to compete with the mass market hardware guys. Or Intel
could roll them either a unique processor.

Any ideas?


Dave

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