Apple mulls info appliance launch

Expects to ship 40 per cent more Macs this year, too

Apple has been telling market analysts it expects to achieve double-digit revenue and unit sales growth during fiscal 2000. However, what's really interesting about the Apple analyst briefing is the company's hints at an entry into the information appliance market. According to Merrill Lynch analyst Steve Fortuna (as reported by Bloomberg), the Mac maker has targets to sell 40 per cent more iMacs, iBooks, Power Macs and PowerBooks this year than it did during 1999. That translates to revenues rising by around 36 per cent. He also reported that the company is "happy" with Street estimates of Q2 2000 earnings in the region of 80 cents a share. Apple second quarter ends on 31 March. Its first quarter, which included the traditionally lucrative Christmas period, generated earnings of 103 cents a share. Fortuna also noted that Apple bosses "alluded" to the "possibility" of an information appliance in the works. Apple has, of course, been here before with its ill-fated Pippin. The PowerPC-based device suffered at the hands of a developer that simply couldn't make up its mind whether it wanted the machine to be a games console, a cut-down family-oriented PC, an Internet access device or all three. Apple only managed to licence Pippin design to a couple of companies, one of which was Power Rangers toy company Bandai, the only operation to bring a Pippin-based machine to market. Apple went on to develop the iMac, a far more sensible system (from a marketing perspective at least) since people tend to want to by what they consider to be 'real' PCs rather than cut-down boxes. The conundrum for Apple is that having sold the iMac on the ease and speed with which it can be hooked up to the Net, it's now considering an appliance the whole point of which is the... er... ease and speed with which it can be hooked up to the Net. Fortuna is keeping mum on any details Apple may have given him, so at this stage almost nothing about Apple's thoughts on the matter is known for certain. However, it has to be said, for such a consumer-oriented company as Apple not to be thinking about an entry into the appliance market even though no such market really exists yet would be, well, unthinkable (though not, as long-time Apple watchers will admit, beyond the bounds of a company that's not always been known for its joined-up thinking). So can we expect some kind of MacOS-based rival to the PlayStation 2 or Microsoft's not-so-secret X-Box? A games oriented unit seems unlikely, since while a Mac-based machine could be made that offers comparable performance to the Sony box, the parlous lack of A-stream titles would seriously hinder its sales prospects (as it did for Pippin). Instead, we'd expect something more Net oriented, something to tie in with Apple's growing interest in the Internet as a revenue generator. Apple is already offering Mac users 25MB of online storage, that could easily be expanded to allow diskless, TV-connected appliances to store bookmarks, game scores and save-states, etc. Cutting out hardware like drives and a monitor could easily allow Apple to offer a cheat 'iMac Jr'. MacOS X's FreeBSD microkernel-based architecture makes it an ideal basis for a high-stable (if hi-fis and VCRs don't crash, neither can consumer electronics Net appliances) yet compact (store it in Flash RAM) appliance OS. Just add a cut-back Mac GUI and you're away. Oh, and an AirPort-connected wireless keyboard would finish it off very nicely, particularly if a built-in LCD allowed to you use it anywhere within your home... Apple clearly has both the motive and opportunity to execute an entry into the appliance market. It also has the branding and the desire to be seen as something more than a PC company. We'll have to wait and see whether it does the deed. ®

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