dacs.doc electric

BEING a devout Mac fan, it is with no small amount of joy that I write this month's column. Long left for dead, even by some of the faithful, it was a major coup last summer when Steve Jobs came back and usurped the CEO slot at Apple. Was the magic still there? Could even he save Apple? Only time could tell.

Almost a year later, the results are in. Apple has been profitable for the last three quarters, this time raking in more than $101 million in profit. The stock is now double the price from when he arrived (about $37 on July 17), and the company is already expecting a profit for the year.

Apple has a great lineup of machines, with names you can remember, and their advertising is awesome, aggressive, inspiring, and even interesting (Who were those people in the "Think Different" commercial?). More important, they are getting people excited again about Apple. When's the last time you were excited about that Compaq or Windows?

So, how did Steve Jobs fix Apple? Yes, he laid people off, but that only fixes things short-term. He killed the Newton, but that only helped with the focus (they only sold 200,000 of them--it really was a distraction). He changed the product lineup from more than 10 different (and hard-to- keep-track-of) names to two. (The G3 Macintosh and the G3 Notebook are easier to remember than Performa, Quadra, PowerMac, etc.) I had a huge wall chart with the different model numbers to help me keep track--and I'm a Mac consultant!

Jobs also killed the clones, which at first glance, seemed like suicide for Apple, but looking closer, he saved Apple from companies that were using Apple technology and paying almost nothing for it. Worse yet, they were eroding the high-end market, where Apple was supposed to be making the big money. Steve saved Apple from a bad deal. He knew Apple should be making money at the low end.

One of the most important things Jobs did was to stop thinking that Microsoft was the enemy. At Macworld last summer he stunned the audience when who should appear (by satellite), more than 40 feet high, but the "devil" himself. Bill Gates and Steve had worked out a deal, and the joint announcement elicited boos from the crowd. How could Steve cut a deal with Microsoft? How could he "sell out" Apple?

In reality, Microsoft is the largest Apple developer. It's rumored that Microsoft makes more on every new Mac than Apple does. The deal resulted in the Mac getting the new version of Office long before Windows, and even gave investors some confidence that Apple would survive.

The sure sign of change at Apple is the iMac. Without a doubt this is going to be the hottest computer this fall--a complete, $1,200 computer that includes all the software and hardware a consumer needs to get on the Internet, and even includes a built-in monitor. A striking new design, without a single straight line, the translucent iMac is awesome.

At first I enjoyed admiring the design, and then I used it. "Whoa!" is right. Fast, sleek, sexy. Apple has caused a stir, not unlike the fervor over the new VW Beetle. If Apple can do this a few more times, we might see 8% to 10% market share again.

Is the danger over for Apple? Not yet, but remember that the company is selling billions (with a "b") of dollars worth of computers every year. A company like Apple doesn't just go away. But Steve Jobs must salvage the shrinking market share (currently 4%), attract hot new products from developers, and introduce innovative products. Something I believe he can do. At Macworld, he spoke of dealing with one perception at a time. The first perception he worked on involved whether or not Apple would survive. Now he's working on innovation.

I hope Jobs succeeds. This business is too boring without Microsoft having Apple to innovate for them. Just take a look at Windows 98, where the new big feature is something that has been on Macs for more than eight years--multiple monitor support. Yeesh!

I hope Steve brings some fun, innovation, and energy back to this business. We sure need it.