Originally created 07/09/98

Jobs unveils Apple's strategy, new iMac at MacWorld Expo



NEW YORK -- Apple Computer leader Steve Jobs on Wednesday detailed the company's strategy for growing again, a survival kit that includes advanced Internet features on Macintosh machines and a burst of new software from games to encyclopedias.

Jobs, drawing whoops and a standing ovation at the MacWorld trade show here, also said Apple expected to report next week its third consecutive quarterly profit amid strong sales of the company's latest machines.

Apple's reception capped a year of partial reversals for the still-struggling computer company, bloodied by customer defections to cheaper desktops running on Microsoft's popular Windows software. Investors joined the optimism, bidding up Apple's stock nearly 7 percent to a 52-week high, rising $2.06¨ at $32.56¨ on the Nasdaq Stock Market.

Just last summer, Mac fans booed and hissed at Jobs' disclosure of a stunning alliance between Apple and Microsoft Corp., which many saw as a desperate capitulation to a longtime bitter enemy.

This time around, Jobs said Apple was deepening those year-old ties, and -- underscoring the company's tentative yearlong rebound -- the Mac audience seemed grudgingly pleased.

"Despite the boos of a year ago, this partnership (with Microsoft) has blossomed," Jobs said to scattered applause from the crowd of thousands at the Javits Convention Center on Manhattan's West Side.

Jobs also said Apple is winning back software developers. Assuaging users worried about a decline in new software for the Mac, Jobs said that 177 developers -- including software titan Microsoft -- have committed to creating Mac software since the Apple announced its futuristic iMac computer for consumers two months ago.

The company did not say how many new applications were written exclusively for the Mac or simply Mac versions of existing Windows software. Exclusively Mac software declined to about 3,400 titles last year from 3,530 titles in 1996, according to the PC Data research firm.

The $1,300 iMac computer, set to hit retail shelves in mid August, is Apple's entry into the low-cost part of the home computer market -- the hottest segment -- where it has been conspicuously absent.

Jobs unveiled features of the iMac that more closely weave in functions for browsing the Internet -- much in the way Microsoft's Windows 98 program blurs the distinction between files stored on the computer and World Wide Web sites.

For example, a new function in the iMac will enable users to search for and retrieve files on their desktop as well as Web site content. One feature lets people type in a word or phrase and then retrieve all files or Web sites containing those search terms.

Another feature enables Mac customers to save Web sites in their computer hard drive for viewing later, even if their machines no longer are hooked up the Internet.

In addition, Apple is including a 56K modem for hooking to the Internet, more powerful than the modem Apple initially announced with the machine.

Several MacWorld attendees expressed strong enthusiasm for the machine's features as well as its unusual translucent design.

"I think (the iMac) is the coolest thing," said Michael Johnston, who plans on buying two iMacs, one for himself and one for his 13-year-old daughter. Johnston, a project manager for software development at the Bear Stearns brokerage firm in Manhattan, also said he bought some Apple stock a month ago.

In a positive omen, many customers are putting down cash deposits to order iMacs in advance, said Richard Doherty of The Envisioneering Group, a Seaford, N.Y.-based consulting firm.

"We're hearing about 100,000 pre-orders," Doherty said. "That's an emotional reaction."

For Microsoft, the alliance with Apple has helped boost its U.S. revenue from Mac software it makes by 50 percent this past year, said Ben Waldman, general manager of Microsoft's Macintosh business unit, with 200 employees.