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Struggling Apple appeals to users for time, confidence
January 7, 1997
Web posted at: 12:00 a.m. ESTFrom Bureau Chief Greg Lefevre
SAN FRANCISCO (CNN) -- Apple Computer users jammed San Francisco's Moscone Center convention hall Tuesday, trying to believe their faith would be restored.
The beleaguered computer innovator chose the MacWorld Expo to reveal its new operating system plan, while acknowledging the financial trouble it is in.
"We've got a few bumps along the way and I don't want that to shake your confidence. It's not going to shake ours," Apple CEO Gil Amelio told the gathering.
Apple said Friday it expected to report an operational loss of $100 million to $150 million because of weak sales of its Performa line of Macintosh computers.
Sales aren't all bad
Revenue for the company's first quarter, which ended December 27, is expected to drop 10 percent from the $2.3 billion reported in the September quarter.
But Apple executives stressed Tuesday that only the home computer market weakened, which was true for the whole industry. They said Apple's industrial computer sales in 1996 were 40 percent higher than in 1995, and sales of business computers also were ahead.
And Apple's new portable computer, the Powerbook 1400, is so popular the company said it is racing to keep up with demand.
Long the darling of Hollywood, Apple is currently using clips from the alien-invading movie "Independence Day" in a commercial that ends with the slogan, "The power to save the world."
Apple plans to save itself by using a new generation of operating software for its Macintosh home computers from NeXT Software Inc., a company it bought last month in an effort to stay ahead of market dominator Microsoft.
The 'NeXT' generation
Steve Jobs, an Apple co-founder and NeXT's president, demonstrated the new system, code-named "Rhapsody," before a cheering crowd.
The new OS is supposed to operate on all but the oldest Macs, will make present-day Macs run even faster and allow users to perform several tasks at a time.
The full system is not expected to be ready for another 18 months, but some aspects of it will be incorporated into Apple systems beginning this month and even more so in July.
And what of the arch-rival?
"Microsoft was one of the very first software developers to recognize the enormous potential and innovative work that is done in that platform, and we continue to support the (Macintosh) platform," said Microsoft's Paul Moritz.
Indeed, every year, Microsoft sells $1 billion worth of software that works for Macintosh machines.
Pentium competition
Also displayed at MacWorld is a new 533-mhz processing chip from the company Exponential Technology Inc. It is being touted as running twice as fast as the fastest Pentium processor, but using less electricity and producing less heat than any potential Pentium of that size.
The chip will be installed on Macintosh computers to be shipped this spring as well as in Macintosh-compatible machines. Four companies are making compatible Macs for the first time: Power Computing, Motorola, Umax and Day Star.
Virtually all of Amelio's keynote presentation was shared with software writers, and virtually all of that was devoted to the Internet, Apple's strong suit -- and some say the key to Apple's future success.
"Apple gets it about the Net -- that's what I like about Apple so much," said Eric Schmidt of Sun Microsystems.
MacWorld attracted more than 80,000 fans this year, 10,000 more than last year. They're among some 53 million people already sold on Apple -- but they're the converted. Now it's the rest of the computer-using world Apple needs to convince.
Related stories:
- NeXT said to be in the red - December 31, 1996
- Apple's future rests on co-founder - December 21, 1996
- Apple chief outlines reorganization - May 13, 1996
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