Apple CFO Gives Info on Company Direction

osViews.com writes "Mac World is reporting a recent talk given by Apple's Chief Financial Officer (Peter Oppenheimer) at the Goldman Sachs Technology Investment Symposium. The article illustrates several things about about Apple's business plan, much of which is totally new information about the company's current and future direction. Here's the nutshell summary: iPod "Halo" effect is causing some Windows switchers, little demand for satellite radio/iPod integration, iPod shuffle margins below HD ipods, happy with rate of growth - no plans to license OS X, margins on Mac mini equal to eMac (both below corporate average), retail store to expand to 125, no plans for media center PC - prefers to stream multimedia to TV from primary computer over wireless network, no video for iPod, portable media centers a failure."

Comments

great submission!

[KingPrad]

Kudos to the submitter and the editor for posting a useful and interesting story with a useful and concise summary. I wish we had more stories done exactly like this one.

Re:great submission!

[tehshen]

I wish we had more stories done exactly like this one.

It'll be posted again within the next week or so, don't worry.

Proudly dying for 20 years

[2nd Post!]

Why do you think that, of all things, is going to sink Apple?

If anything I would have thought their intensely secretive nature would kill them.

Their iPod and iTunes products are exactly how they are expanding to the PC world.
Their mini is exactly how the PC world will get OS X.

If OS X is the only real desktop alternative, nothing is stopping people from buying Macs you know.

Re:Proudly dying for 20 years

[solios]

Everything Apple's ever done has, according to people who get paid to be taken seriously, been the death knell of the company.

And the only thing that's stopping some people from buying Macs isn't the price point or the applications, it's the games.

Feel free to spout off the list of everything with Mac support, and realize that Painkiller, System Shock, GTA, Half-Life, Half-Life 2 (and by extent Steam, CCS, etc) and a shitload of other games aren't available. And several Mac ports have been gutted on the way over- it's an old example, but Baldur's Gate for the Mac is missing multiplayer and any character customization capability.

There's a large chunk of the vocal PC userbase who use the thing as glorified nintendo- it's really (imo) the ONLY area where the PC has any kind of advantage over the Mac.

Re:Proudly dying for 20 years

[Anonymous Coward]

Macs are actually less expensive than PCs.

When you equip a PC with the exact same components in hardware and software as that which come standard on a Mac... the PC always comes out to be more expensive.

people misunderstand this because... with a PC, you can buy less and spend less. That does not make the PC less expensive... though it does make it more configurable... at least at the origional buying stage.

Re:Proudly dying for 20 years

[justin12345]

Adding to what you said:

At this point, every geek I know (hardly a scientific sample, I know) who used to build their own unix/ linux boxes has now bought a powerbook. Eventually they just got tired of fooling with something that was going to be their primary machine (plus BSD tends to be a pain on laptops).

I know... I'm getting flamed for this one.

Re:Proudly dying for 20 years

[2nd Post!]

Okay, forget size for a moment.

Where can you get a $499 PC with:

CD-RW
DVD-ROM
Firewire
non integrated, non shared 32mb video (ATI or NVIDIA)

And with software, to boot:
Movie making
DVD making
Music making
Photo album

Yes, all that software exists. Yes all that hardware exists. None, to my knowledge, come in kit that's $499. For $349 you can get a PC without CD-RW and with shared video ram and integrated video. For $649 you can get the video+CD-RW and DVD.

Likewise software; for $699 or more, you get the movie making software, but for bundles of $499? You get Quicken or Windows XP Home and Norton Antivirus.

I just don't get this

[Anonymous Coward]

Halo wasn't even that good, but it's being given now not only credit for the success of the XBox but the success of the iPod??

Something is seriously wrong with us as consumers if we are so reordering our world for such a mediocre FPS.

Re:So, Mac's dying?

[phillymjs]

Looks like it's once again time to dust off my "why OS X on x86 won't ever happen" post:

----------
Look, you guys just can't get it through your heads that the reason why OS X works so well is because it runs on such a limited pool of hardware-- this allows the engineers coding OS X to make assumptions THAT CANNOT BE MADE in the x86 world, where a machine could be using one of thousands of motherboards, network cards, graphics cards, sound cards, etc. Windows developers have to code for the lowest common denominator. OS X developers code for specific hardware. Even the version of NeXTStep that ran on Intel hardware ran on a tiny subset of the then-available PC hardware. If your CD-ROM drive and motherboard weren't on the "supported hardware" list that came with NeXTStep, you were SOL.

That little fantasy you all have of buying "Mac OS X for x86", running it on some homebuilt shitbox you cobbled together from spare parts, and having it work as well as a G5 runs Panther today will NEVER come to pass. Microsoft has spent twenty years and untold millions trying to achieve that goal, and they still have quite a way to go.

Do you think Jobs could just snap his fingers one day and a few months later have a product on the shelves that would run perfectly on every PC capable of running XP today? It's impossible. And even if it were possible, you wouldn't buy it. Why? Because Apple uses their software to sell their hardware, so a copy of OS X for x86 would have to be priced to ease the pain of a lost hardware sale-- you'd either do without it and bitterly bitch about the price here on /., or you'd pirate it-- either way, Apple would lose money on it.

~Philly

and one for you

[Anonymous Coward]

running OS X on a piece of shit Fry's discount x86 box doth not a Mac make.

This is where the Tivo rumors could come in

[Dark Paladin]

no plans for media center PC - prefers to stream multimedia to TV from primary computer over wireless network

I don't buy that Apple will buy Tivo, but I can see them creating a Tivo-like device with these abilities:

DVR with free remote control service (why free? wait a second)
Ties right into the iTunes Movie store.

Right, Movie store. Imagine Jobs going to the MPAA and saying "Hey, remember all the problems the RIAA had with downloading? Lawsuits didn't help enough - but now we have legal music, and people are buying music online, and look how many songs I've sold.

"Join with me, and we can end this pointless conflict, and bring order to - *cough*, I mean, we can sell movies."

The PC/Mac will still be the hub - use iTunes to buy music, or buy a movie. You can put either on a new iPod, but for the movies, the iView (just a name I threw in) will be the best way.

Want to watch a movie? Forget Netflix - just use the iTunes store. How about a documentary (independent movie makers who have limited releases would love this - what if you could pick up a documentary for $10, and around 50,000 people all wanted to - now that little indie project just broke even).

Miss a TV show? Why DVR it (though you have that power) when you can go to your computer, type "Battlestar" or "Babylon" to get the entire current archives (including commercial), and for $3 (or $20 for the entire season), you can watch your movies *now* (or, with broadband and figuring about 300 MB per 30 minutes, about 30 minutes or so).

The biggest thing of this is what it turns Apple into. With the iPod and the iTunes Music store, apple is moving away from hardware systems, and going towards hardware accessories and services. Eventually, I can see a Linux client - but in the end, Apple won't care what you run as long as you buy an iPod and use their iTunes store for movies and music - they still make money (though they'll still tell you a Mac will work better, and as the services do well they'll sell more Macs along the way).

Anyway, that's just my opinion. I could be wrong.

Re:So, Mac's dying?

[Elranzer]

True. Not to mention the binaries for OS X software is built for PowerPC, not x86. Let's take Photoshop for example...

Say, for argument's sake, that Mac OS X 10.5 came out for Pentium/Athlon PC. You buy it, install it, presto. Now, you want to run Photoshop. OOH, which do you install? Photoshop for Mac OS X? No, it's compiled for PowerPC. Photoshop for Windows? No, it's compiled for Windows. You would need to buy a special Photoshop for OSX/x86, a third option.

Basically, when you put aside the software pirates (99% of Slashdot users who use Photoshop) and the rich artist/musician types (who would buy the Mac hardware anyway), OS X for x86 would be a software nightmare. For corporations, it would be a software investment crash. You can't use your legally owned Windows software on it. You also can't use your legally owned OSX PowerPC software. It just would be a failure.

The only reason Linux works on multiple platforms is because 99% of its software is open-source and can therefor be compiled for the installed architecture when needed. When you get to the prorpietary stuff, like Photoshop, it becomes a nightmare.

If you need a Linux example, look at Macromedia Flash (player) and VMware Workstatioin. Heck, even look at official NVidia drivers. Try and get those for SPARC or PowerPC Linux (or any non-x86 Linux). You can't. Now, imagine all the software for your operating system in the Flash/VMware situation. You go to buy Photoshop for OSX only to realize it's coimpiled only for PowerPC.

The only way it could work is if Adobe, Macromedia, Apple, even Microsoft (Office 2004 for Mac) needs to compile an x86 version of all its Mac OS X software and then recall all discs that only contain the PowerPC software. It would be a financial nightmare, for the consumer and the manufacturer. If you want a living example of the whole situation, look at the "64-bit" Windows XP for Itanium, or hell even Solaris.

Of course, 99% of Slashdotters who use Windows XP run a pirated copy, with a pirated version of Photoshop or whatever, so I'm sure this has all gone through one ear and out the other...

I Switched

[MBCook]

I switched. There are about 10-15 blog style entries on the page mentioned in my sig about it. Here is a short version of why:

Used to like Apple, moved to PC for customizability/etc (in mid 90s). Never considered moving back because the more I learned, the more obviously out of date the Mac OS was. Then I learned Linux and fell in love with Unix. Add to that the hate and distrust I've gained in MS and I was ready to jump ship (and I knew it wouldn't be too hard for me, unlike some people). Linux didn't seem "there", I wanted something more mainstream. When OS X came around (and I got to try it on my brother's PB) I really liked it, and started following it. I got an iPod, which did serve to remind me of Apple's quality. Then when my current computer (a Dell laptop that served me well for 4+ years) became too slow for my needs I waited until new PowerBooks were announced and I bought one. The whole (longer) story is in the site linked to in my sig.

So as for "the halo effect", I'm not so sure. It might happen for some people. I used to love Apple so I was really just finding them again. And even without the iPod I would have switched because of OS X. I have three observations on all of this. First is that iTunes really showed me how nice Apple software was these days (iTunes on Windows was the first Apple program I'd used since leaving my old LC II in about 95). Second was if OS X was available on a PC (as some want it, and as some other companies have been asking Apple) I doubt I would have switched (why switch processor architectures when you don't have to?). And third, I had been wanting a Mac to try OS X on for the last few years, but even used Macs were expensive (for what you got). Had the Mini been available 2 years go (the equivelent kind of computer, at that price point, not neccessisarily that size) I would have bought one as fast as I could and I may have switched earlier.

I'm not the "typical" switcher (someone relativly new to computers and raised on Wintel that went to Apple) since I'm a power user (used the OS 7 back in the day, Linux, most flavors of Windows, etc); but I switched and I am VERY happy with my new little Mac. Next step: evangilizing when people ask me about what to buy for their first computer!

Re:I have the opposite problem

[orange7]

Go to System Preferences, Accounts, add a new account, click on the limitations panel, choose simple finder, and check the smallest subset of applications you need to get by. (Say Safari, iTunes, maybe that's it.)

Log into the account. You'll notice there is just the dock at the bottom with an applications folder, and a documents folder. Single clicking opens apps or documents. Now, for maximum simplicity, open up each app, choose Open, and drag over the middle bar in the open dialog so the disks and default folders are covered up. That leaves no distraction from the documents folder.

That's what I do to create an account for someone who doesn't "get" all that techie computer stuff. (And fair play to them.)

Now, your point might be that there should be an option to set the machine up like this the first time you boot it up, and I'd totally agree.

A.

Re:So, Mac's dying?

[porcupine8]

That stubborn and insanely stubborn backward mentality is what's finally going to sink Apple.

Absolutely. The first 20 years of their existence, the only thing that kept them afloat was licensing their OS to other manufacturers. This new no-licensing policy is really a death knell, there's no way they can stay in business like that.