Come On, Steve–Think beyond the Mac

When Apple Computer’s Web site proclaimed "Count the days, count the
minutes, count on being blown away" in anticipation of the annual Macworld
Conference & Expo that started on Jan. 7 in San Francisco, rumor had it
Chief Executive Steven P Jobs was about to announce the Next Big Thing. Industry
watchers hoped Jobs would unveil a home media management center or handheld
device that would help catapult Apple beyond the slow-growth desktop computing
world and into dazzling new digital devices for the home.

New Looks, Same MAC(hine): Jobs (left) shows off the revamped iMac

Nice Idea, But…

The new iMac is snazzy, but Jobs’ "Digital Home" concept needs more: An all-purpose media center that ties together all home digital entertainment An iPod digital music player that works with both Macs and PCs A Palm-like handheld device to remotely access a home media center

That turned out to be wishful thinking. Instead, the highlight of Jobs’s
keynote was the debut of a revamped iMac. The sleek new PC offers a 15-inch
flat-panel monitor connected by a swivel arm to a compact and curvy base that
holds the brains of the computer. It’s a beautiful design. And, in an
only-too-familiar refrain, Jobs called it "the best thing we have ever
done."

Steve, it’s time to admit the Mac-centric strategy can only go so far. To
boost its long-term prospects, Apple needs to reexamine its belief that the
Macintosh will become the hub in most homes for coordinating digital devices
such as cameras, music players, and handhelds. Last year, Jobs announced Apple’s
digital hub strategy and Apple unveiled whizzy, easy-to-use software to manage
home movies and digital music. In mid-November, it brought out its
card-deck-sized iPod digital music player capable of storing 1,000 songs.
Problem is, all of these products work just with Macs.

Apple shouldn’t give up on the Mac, but it could open vast new markets for
itself if the company applied its design prowess to other products. Mac fans
have been clamoring for an Apple handheld organizer–similar to the Palm–which
works with both PCs and Macs. The company could create a sleek Apple media
center that wirelessly networks any kind of computer, handheld, or other digital
equipment. Or it could team up with consumer electronics companies to create
Apple-branded digital gizmos with Apple’s unique look and feel. So far,
though, Apple hasn’t signaled that it’s planning on branching out beyond its
Mac technology.

Apple needs to grow roots in new soil in a hurry. The company’s worldwide
market share fell to 2.9% on Oct. 1 2001, from 3.3% a year earlier, according to
market researcher IDC Corp. What’s more, a slew of companies is racing to
offer similar digital products for the home. Microsoft is trying to morph the PC
into the hub of the digital home. And a Palo Alto startup called Moxi Digital is
working with cable and satellite providers to offer a media center that would
not only control Mac and PC software but also include a personal video recorder
that wirelessly connects all the TVs in a home.

Apple has shown that it can break the mold and make PCs fun and easy to use.
But that hasn’t reversed its gradual slide into irrelevance. Now it needs to
break out of its all-Mac, all-the-time rut. And unless it does so soon, the
company’s website might as well post this message: "Count on being
underwhelmed."

By Cliff Edwards

The author covers Apple from Silicon
Valley in BusinessWeek. Copyright 2002 by The McGraw-Hill Companies, Inc