Reuters North American News Service, January 16th, 2008
SAN FRANCISCO (Reuters) - Apple Inc Tuesday
launched an aluminum-clad laptop just three-quarters of an inch
thick, seeking to bring a new computer to market with the same
cachet as its iPod and iPhone devices.
Apple also said it would let people rent films over the Web
with upgrades to its iTunes online media store, a technological
challenge to a movie industry still largely focused on DVDs.
Shares of movie rental firms Netflix and Blockbuster fell
sharply in response, and Apple's own stock lost 5.5 percent
since the announcements were widely expected and Chief
Executive Steve Jobs failed to conjure up any big surprises.
Jobs set a high bar last year by unveiling the iPhone. In
addition, many times he ends presentations with by saying,"One
more thing..." as a prelude to something unexpected. This year
there was none.
Still, Jobs' talents as a showman were on display when he
took the stage at the annual Macworld convention in San
Francisco to cheers and applause from a few thousand software
developers, customers and Apple employees.
He detailed a series of new products and services but saved
the laptop, dubbed the Macbook Air, for last, drawing it out of
a standard manila envelope to emphasize its slim dimensions.
Jobs said the new notebook was the thinnest available,
measuring 0.76 inches at its thickest point and tapering to
just 0.16 inches.
Priced from $1,800, the Air bridges the gap between Apple's
entry-level and high-end laptops, but analysts voiced concern
that it could steal customers away from pricier products.
"It's not really clear how many more incremental buyers you
can drive, and there could be some cannibalization," said Shaw
Wu, an analyst with American Technology Research.
Macbook laptops have been one of the company's strongest
products, with sales rising 37 percent on the year in the
fiscal fourth quarter ended last September.
Phil Schiller, Apple's vice president of marketing, said
the new laptop could appeal to a large swath of customers,
including business travelers, those in education and people who
wanted a more attractive computer at home.
"The goal overall is to continue to grow the business, so
having another product in the line helps to do that. If the mix
(of customers) changes a little bit, it doesn't matter as long
as we grow everything," Schiller said.
Apple stock has nearly doubled since last year's Macworld,
and in late December topped $200 for the first time, driven by
market-share gains by Mac computers, continued iPod strength,
and enthusiasm over the iPhone, which Jobs said had sold more
than 4 million units since its release last June.
Jobs showed off new iPhone features such as displaying a
user's location on a map and a way to customize the main screen
with icons linking directly to specific parts of a Web site.
"The iPhone is not standing still. We keep making it better
and better and better," Jobs said.
But the company has struggled to find a big audience for
Apple TV, a product originally designed as a Mac accessory for
watching Internet video on a television and unveiled alongside
the iPhone a year ago.
"It's not what people wanted. We learned what people wanted
was ... movies, movies, movies," Jobs said.
A new version of Apple TV will be able to connect to the
Internet directly and download TV shows, movies and music
through iTunes. Viewers will be able to choose movies directly
from their TVs and Apple said viewers could start watching
within seconds if they had a fast Internet connection.
Jobs announced deals with all six major movie studios and
several smaller ones to offer movies for rental through iTunes,
with new releases costing $3.99 and library titles $2.99.
High-definition movies will also be available.
The revamp of Apple TV hardware combined with a broad
selection of movies would give Apple an edge over competitors
such as Amazon.com Inc, Netflix and Microsoft Corp, American
Technology Research's Wu said.
News Corp's 20th Century Fox, Walt Disney Co, Time Warner
Inc's Warner Bros, Viacom Inc's Paramount, General Electric
Co's Universal, Sony Corp's Sony Pictures, Lionsgate, MGM and
New Line have all signed on to Web rentals, Apple said.
"It's too early to declare that this is going to be a big
hit but this is arguably the best offering out there right
now," Wu said.
Apple shares fell to $169.04, while mail rental firm
Netflix Inc shed 3.2 percent, and top video rental chain
Blockbuster Inc dropped nearly 17 percent.
(For more tech news see the Reuters Mediafile blog at
http://blogs.reuters.com/mediafile)
(Additional reporting by Duncan Martell in San Francisco,
Sinead Carew and Kristina Cooke in New York; Editing by Toni
Reinhold and Braden Reddall)
