Tuesday, February 28, 2006

 

Apple introduces Intel-based Mac Mini, IPod stereo

NOW APPLE IS TRYING TO TAKE OVER HOME ENTERTAINMENT, WHO DO YOU THINK WILL WIN IN APPLE VS. INTEL?

By Connie GuglielmoBloomberg NewsPublished February 28, 2006, 3:17 PM CST

Apple Computer Inc., maker of iPod music players and Macintosh personal computers, introduced a home stereo and new Mac Mini PCs designed to give the company a bigger foothold in living rooms.

The iPod Hi-Fi stereo system is $349 and goes on sale today. The Mac Mini with chips from Intel Corp. is two to five times faster than earlier models, Chief Executive Officer Steve Jobs said today at the company's Cupertino, California, headquarters.

The two products signal Jobs wants a bigger role in home entertainment. The Mac Mini connects to televisions and has a remote control. Jobs is also trying to maintain momentum for the best-selling iPod and use its popularity to spark interest in Macs, which are more profitable than music players. The faster Intel chips may win buyers who hadn't considered Macs.

``This is their move into the living room,'' said analyst Gene Munster of Piper Jaffray Cos., who rates Apple's shares ``outperform.'' ``The Mac Mini will be the first media center that will work. The remote control is the key, bridging the gap between the technical and non-technical user.

Shares of Apple fell $2.50 to $68.49 at 4 p.m. New York time in Nasdaq Stock Market composite trading. They have fallen 20 percent since a Jan. 13 peak on concern Mac sales may slow as customers delay purchases until the Intel transition is complete.

Some analysts, including Shaw Wu of American Technology Research, had predicted Apple would also introduce a revamped line of iBook laptop computers.

Seventeen analysts suggest buying the shares and 11 recommend holding them.``For underlying sales and fundamentals, the Mac Mini is the most important, but from a strategic point the iPod boom box is interesting because it signifies they want to move more into the living room,'' analyst Robert van Batenburg of Louis Capital Markets said today in an interview.

Jobs said the iPod Hi-Fi has audio quality comparable to portable music systems that sell for $800 or more. Apple is delivering home-stereo quality ``for the first time in the iPod ecosystem,'' said Jobs, dressed in his trademark jeans and black turtleneck. ``A lot of work went into this.''Apple began switching its Macs to chips from Santa Clara, California-based Intel last month with an iMac desktop PC, and followed that up this month with two versions of its first Intel- based notebook, the MacBook Pro.

Jobs, who turned 51 last week, is moving all Macs to Intel's chips by the end of this year in a switch from processors made by Armonk, New York-based International Business Machines Corp.

The company has switched half of the Mac product line to Intel chips within the past 60 days, said Jobs.The new Mac Mini, Apple's lowest-priced PC, can use a TV as its display. It is sold without a keyboard, mouse or monitor. The model with Intel's Core Solo chip, designed for lower-priced machines, is $599. The model with the faster Core Duo chip is $799. Both are available starting today.With Front Row software, customers can use the Mac Mini to display photos and videos on TVs, and pick and choose songs using the remote control.``They are doing reasonably well on the Intel transition, and the strength of iPod has provided a window of opportunity'' to sell more Macs, Ken Smith, who manages $1 billion including Apple shares at Munder Capital Management in Birmingham, Michigan, said before the product announcement.

Jobs has boosted sales at Apple with the iPod, shipping more than 42.2 million players since he introduced the device at a similar invitation-only event at the headquarters in 2001. They contributed to a 65 percent rise in sales and near doubling of profit in the last quarter.Apple today also introduced $99 leather cases for iPods.

IPods and music sold through Apple's iTunes online store accounted for 60 percent of sales last quarter, up from 40 percent a year earlier. Apple said last week it has sold more than 1 billion songs at 99 cents each since opening iTunes in April 2003 and more than 15 million videos, at $1.99 each, since adding them in October.

Comments:
i suspect that no one will make it down to the bottom of this but if you do, take a look at the last paragraph:

IPods and music sold through Apple's iTunes online store accounted for 60 percent of sales last quarter, up from 40 percent a year earlier. Apple said last week it has sold more than 1 billion songs at 99 cents each since opening iTunes in April 2003 and more than 15 million videos, at $1.99 each, since adding them in October.

It is very interesting to note that 60% of apple's 4th quater revenue came from ipod and itunes sales. that could be a sign of a larger trend in their business or it could be an symptom of the switch to intel (people holding off on buying macs until the switch over is finished). If it is a sign of a shifting business model, should apple be happy about it? It seems that their computer sales would be more profitable.
 
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