Ingram's article is now on line. What a piece of garbage. I emailed him prior to it being posted in a vein attempt to correct the glaring misconception. Another sheep......
"Apple Computer can never manage to live up to the hype that precedes a major computer show, since Macolytes inevitably spin themselves into a frenzy of wishful thinking, convinced that Steve Jobs will display a faster-than-light warp drive or something similar. It's probably safe to say, however, that the news at Macworld this year was even more disappointing than usual ? and so was the company's latest quarter.
Among the rumours percolating through the Apple community leading up to the Mac show last week was speculation that Mr. Jobs would announce a new version of its successful iPod personal audio player, one that would play video clips and other multimedia as well as digital music files. There was also talk that the company might launch a version of the iPod or a similar device that would support wireless networking.
Either one or both of those would have made for a natural extension of the brand Apple has built with the iPod, which despite its relatively high cost has become one of the hottest (or coolest) media players around. But Apple didn't announce anything of the kind. Instead, it launched two new laptops ? one a very small extension of the PowerBook line, and the second a much larger extension of the PowerBook line.
Someone else announced a portable iPod style digital music and video player, however ? Microsoft. At the Consumer Electronic Show, Microsoft said a number of vendors would be coming out with media players that would hold between 5 gigabytes and 20 gigabytes and have video screens for playing movie clips. The company also said it was launching a watch that would be able to receive digital information over an FM radio frequency network.
Apple also made several software-related announcements, including new versions of iTunes, iPhoto and iMovie, as well as a new Web browser for the Mac called Safari, designed to compete with Microsoft's Internet Explorer and AOL Time Warner's Netscape. And Mr. Jobs made his presentation using another new software product ? a multimedia presentation program called Keynote that is similar to Microsoft's PowerPoint.
There were other announcements as well, including an update to the AirPort wireless unit that supports the faster 802.11g standard, and a snowboarding jacket that will store an iPod, with built-in headphones and volume buttons on the sleeve. Cool? Definitely. But when it comes to earth-moving products that might drive revenue or profit growth for Apple in the near to medium term, Macworld had very little to offer.
That's too bad, because the company Steve Jobs rescued from almost certain death with dramatic successes such as the iMac, the iBook and iPod could really use something substantial. In its first quarter ? a period that is traditionally strong for computer makers, including Apple ? the Cupertino, Calif.-based PC maker had a net loss of 2 cents a share on sales of $1.5-billion, sales that were lower than analysts expected.
While the company would have made 3 cents a share if not for several one-time charges, that is still just $11-million on sales of $1.5-billion, a return of .7 per cent (Apple made $38-million in the same quarter of 2001, which still works out to a return of less than 3 per cent). Shipments were flat overall in the quarter, and Apple said it expects shipments in the first quarter to also show little or no growth ? higher sales of some newer products are only serving to offset lower sales of older ones.
A 17-inch PowerBook is certain to appeal to many, and so is the much-smaller version, but neither is an obvious home run in the making. And while the iPod has sold extremely well, with more than 400,000 units shipped, that was what drove sales in 2001 and 2002 ? and it has been overtaken by similarly featured but lower-priced units from other companies. As it cuts prices, meanwhile, Apple's profit margins get hammered.
What Apple needs is something to drive sales in 2003 and 2004, and it's not clear that a new large laptop and a new small laptop will do it, or upgraded versions of the iMac and iBook. As for the software announcements, while Keynote and Safari are nice additions to the Mac world, even the most devoted fan would have a hard time believing Apple can actually compete with PowerPoint or Internet Explorer at this point.
It's no surprise that the day before Steve Jobs's keynote speech, Merrill Lynch put out a "sell" recommendation on the stock, since it is selling for 50 times earnings estimates for this year, despite having fallen sharply over the past six months. With $4-billion in cash and little debt, Apple is certainly far from the oblivion it has flirted with in the past ? but it could still use a little more of that old Jobs magic."