January 5, 1999 Web posted at: 6:20 PM EST by Jeff Walsh

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SAN FRANCISCO (IDG) -- Steve Jobs opened the Macworld Expo here Tuesday by announcing new hardware, displays, system software, support from gaming developers, and multicolored iMacs. Jobs also noted that Apple would be announcing its fifth consecutive profitable quarter next week, although specific details were not announced.

Jobs opened his keynote with an ad featuring Hal-9000, the computer from the Stanley Kubrick movie 2001: A Space Odyssey. The ad pokes fun at the year-2000 problem, as Hal notes that only the Macintosh computer had always addressed the year-2000 problem.

Joking about his role as the company's iCEO (because he is still serving as the company's interim CEO), Jobs introduced a new desktop machine for professional users. The design goals for the new product were for it to be the most powerful and most expandable system, with the best graphics and the best design, according to Jobs.

"[Apple wants to make] not only the most powerful Macintosh built, but the most powerful [system] in the whole industry," Jobs said.

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The system features processor speeds as fast as 400MHz, with G3 chips coming from both Motorola and IBM (although Jobs mistakenly said Intel during his keynote address). The back-side cache has also been upgraded to 200 MHz.

During a demonstration of the new processors, the new Mac and a Windows machine drew a scene from the Walt Disney movie Mulan, with the Mac performing much faster than its equivalent Windows counterpart. Upon doing the demo again, the Windows machine also had a delay, "reverting" back to a blank page to start the demo again.

This delay prompted Jobs to quip, "Maybe it's telling you to revert back to a Macintosh."

Hal-9000 interrupted Jobs' presentation, and insisted on pitting itself against the new PowerMac. When it also lost, it told Jobs it would not allow the demonstration to continue.

The new G3 PowerMac draws its styling from the popular iMac.

On the graphics front, the systems will feature the ATI Rage 128 graphics accelerator and 16MB of graphics memory, as well as the OpenGL graphics library, which Apple has licensed from Silicon Graphics.

"We are going to integrate OpenGL into the Mac OS," Jobs said, drawing cheers from the capacity crowd.

"OpenGL is the 3-D graphics standard. We welcome Apple into the OpenGL world," said Rick Belluzzo, chairman and CEO of SGI, in Mountain View, Calif.

On the expansion front, the new systems support Universal Serial Bus, Firewire, and Gigabit Ethernet. The systems can host as much as 1GB memory and 100GB storage internally.

Jobs also previewed Firewire-capable 6GB drives from VST Technologies that could instantly be connected to the PowerMac for easy "Sneakernet" storage solutions.

The design of the system looks like an iMac in terms of both its color scheme and design, and it features a "door" that opens the side of the tower unit for complete accessibility.

Pricing on the new system starts at $1,599 and runs to $2,999, Jobs said.

Jobs then introduced three new Apple studio displays: a $1499 21-inch Trinitron display, also boasting iMac colors and angles; a $499 17-inch Trinitron display; and a flat-panel display.

On the Mac OS front, Jobs said more than one million users have upgraded to Mac OS 8.5, with another million new systems shipping. Jobs then announced the immediate availability of the Mac OS X Server, which can be booted over a network.

"We have modified the Mac OS so it can boot over a network. It thinks it's doing it locally, but it's doing it on a server," Jobs said.

The Apache Web Server, BSD 4.4, Java, and WebObjects are also built in to the Mac OS X Server. This marks the first time WebObjects can run on the Mac OS, Jobs said.

Jobs demonstrated an iMac being used as a thin client getting the Mac OS and files from the server. To prove it could scale for a classroom, Jobs then unveiled 50 iMacs behind a curtain, all getting streaming video from the one server. The Mac OS X Server ships in February and costs $995 per server.

Jobs then drew attention to the fact that 1,355 new or renewed applications for the Mac OS have been announced since the introduction of the iMac.

Prior to introducing a Microsoft spokesman, Jobs talked about the Justice Department trial in which Apple testified for the government.

"Our relationship with Microsoft is kind of like a marriage," Jobs said. "It's terrific 99 percent of the time. And one percent of the time we argue, usually over multimedia. And in life, that's not a bad ratio."

Ben Waldman, general manager of the Microsoft Business Unit, then took to the stage and introduced Internet Explorer 4.5, Outlook Express 4.5, and Microsoft MacTopia, a new Web site.

Internet Explorer now features the same drag-and-drop install as Office 98, Waldman noted.

"Just try and do that on Windows," Waldman said, drawing applause.

Explorer 4.5 is now twice as fast; images dragged to the desktop are translucent when being moved and automatically have thumbnails; an auto-fill button fills out common Web forms with personal information; and Web pages are modified when printed. Users can also get a configurable print preview.

"Printing finally works from a Web browser, and I think it's about time," Waldman said.

The browser also has a Sherlock button, for finding pages as well as discovering pages similar to the page the user is currently viewing.

Both Internet Explorer 4.5 and Outlook Express 4.5 are shipping today, and MacTopia, a new Microsoft Web site for Apple users, is now available at www.microsoft.com/mac.

Jobs then showed gaming developers returning to the Mac, with popular titles being readied or shipping for the Mac OS, and announced that Connectix is shipping a product Monday that will enable any Mac to play Sony PlayStation titles.

The popular iMac is now available in a rainbow of colors.

Jobs also announced that Apple sold 800,000 iMacs since the product's launch four and a half months ago -- which equals one sold every 15 seconds, Jobs was quick to point out -- and introduced new research showing that 32 percent of first-time computer buyers were buying iMacs; 13 percent were Windows converts; and the other 55 percent being sold to previous Macintosh owners, with 24 percent adding a new computer to their household and not replacing an older unit.

Eighty-two percent of the iMac customers were connected to the Internet, the research found, with 66 percent getting connected the first day they bought their iMac. Forty-four percent of those reported it took them less than 15 minutes to connect to the Internet.

For 1999, Jobs said the iMac would get a processor upgrade to 266 MHz, with a 6GB hard drive and a $1,199 price tag. The system is also available in five new color schemes: blueberry, grape, tangerine, lime, and strawberry. Jobs urged the crowd to collect all five, which drew laughs from the crowd. The new colors are available for purchase as of today.

In a rare display, Jobs received a standing ovation from many in the crowd upon completing his keynote.

Jeff Walsh is an InfoWorld senior writer.