Management and Talent:

Steve Jobs underscores the importance of strong leadership and talent in reviving Apple. Since the new management team took over, Apple has not only stabilized but is also thriving. The senior management is described as strong, and the board of directors is praised for its wisdom. Talent retention has improved, dropping from a 33% annual attrition rate to 15%, which is below the Silicon Valley average.

Strategic Partnerships and Distribution:

Apple made key changes to its distribution system, partnering with CompUSA for “store within a store” setups. This partnership has increased Apple’s CPU revenue share in CompUSA from 3% to 15% in six months. The change is cited as one of the major reasons for Apple’s comeback.

Online Engagement:

Apple’s web presence has seen a tremendous surge in traffic, indicating growing interest in the brand. Visits to Apple’s website have increased from 1 million hits per day to 10 million hits per day, with the website becoming a “general thermometer” of public interest in Apple.

Market Share and Growth:

Apple has also increased its market share from 3.4% to 4% in one quarter, representing a 15% growth. Although Jobs admits that 4% is not ideal, it’s a positive trajectory that he expects will continue.

Financial Health:

Apple has turned profitable, making $47 million and $55 million in two successive quarters. Its cash reserves have increased to $1.6 billion, and its market capitalization has added $2 billion since the new management team took over.

Product Strategy:

Jobs outlines a straightforward product strategy focused on delivering two main types of products: consumer and pro, each available in desktop and portable versions. This strategy was formulated by listening to customer needs and wants.

Performance Metrics:

Jobs highlights the success of the Power Macintosh G3, which he claims is twice as fast as the Pentium II chip at the same clock speed. This assertion is backed by Byte Magazine’s ByteMarks, an industry-standard performance metric.

Conclusion:

Jobs provides multiple data points to support his statement that Apple is “back on track,” ranging from leadership and talent retention to strategic partnerships and technological advancements.

Complete Redesign:

Steve Jobs introduces a completely redesigned PowerBook G3, describing it as the new gold standard for portable computers. The design has been overhauled from the processor to the keycaps. He emphasizes its aesthetic qualities, describing it as not only “hot” but also “beautiful” from every angle.

Display Options:

Jobs highlights the G3’s versatility in display options. For the first time, Apple offers more than a 12-inch display, providing 13-inch and 14-inch options as well, with a higher resolution of 1024 x 768 pixels.

Modularity:

The PowerBook G3 features two bays, allowing users to insert one or two batteries or various drive options. Each battery offers three and a half hours of life, totaling seven hours with two batteries. The bays are hot-swappable, allowing for easy transition between different modules like floppy disk drives, CD-ROMs, and DVD-ROMs.

Battery Design:

The batteries come with a unique feature: a button that instantly shows their state, whether inside or outside the computer. Jobs also claims the PowerBook G3 has the best keyboard among portables.

Processing Power:

The PowerBook G3 is equipped with a G3 chip, offering multiple speed options up to 292 megahertz. Jobs asserts that Apple can use its fastest chips because they draw less power, contrasting this with power-hungry Pentium chips.

Competitive Edge:

Jobs makes a direct comparison with the fastest available Pentium notebook—a 266 megahertz P2 model. He argues that the PowerBook G3 outperforms this competitor, essentially “eating Pentium notebooks for lunch.”

Product Marketing Collaboration:

Towards the end, Phil Schiller, the Vice President of Worldwide Product Marketing, is invited onstage to assist with demos, suggesting that this release is a high-stakes, well-coordinated effort.

Windows Competitor Mention:

Another speaker presents the Compaq Amarta 7800, a high-demand Pentium 2 notebook, setting the stage for a head-to-head comparison. This suggests that Apple is confident enough to directly challenge its strongest competitors.

Compaq’s Offering:

The Compaq Armada 7800, a $5,400 machine, boasts a 512 backside cache and uses Intel’s AGP for fast 64-bit graphics. It has the fastest notebook graphics and is excitedly awaited by the Windows market.

Apple’s Lineup:

Steve Jobs sets the stage for a showdown by comparing the Compaq machine with two versions of Apple’s new PowerBook G3, one running at 233 MHz and another at 292 MHz. Both Apple machines are priced lower than the Compaq Armada.

Photoshop Showdown:

To highlight real-world application performance, a Photoshop test is conducted on all three machines. Jobs reveals that the test uses a 27-megabyte file with 40 pre-set Photoshop actions. The aim is to demonstrate the PowerBooks’ proficiency with resource-intensive tasks that many customers perform regularly.

Intel’s MMX Technology:

A speaker notes that Intel often showcases Photoshop performance to flaunt their MMX technology in the Pentium 2 processor, implying that this is a fair cross-platform test.

Performance Results:

During the Photoshop test, the PowerBook G3 running at 292 MHz finishes first, followed by the one at 233 MHz. The Compaq machine finishes last, despite being touted as the fastest Pentium notebook in the world.

Macromedia Director Test:

The second demo uses a 30-megabyte Macromedia Director file to assess multimedia performance. This software is noted for its importance among Apple customers who create multimedia presentations on-the-go.

System-Wide Exercise:

The Macromedia Director demo is particularly valuable because it tests multiple components including the graphics, processor, cache, and overall system performance, providing a comprehensive view of each machine’s capabilities.

Concluding Remarks:

The PowerBook G3 outperforms its competition in both tests, underscoring Apple’s claim that their machine sets a new standard for portable computing. Jobs thanks the audience, concluding the segment with a strong case for the PowerBook G3’s performance advantage over its competitors.

Concept and Target Market:

Steve Jobs introduces the iMac, aimed primarily at making internet access simple and fast for consumers. He also mentions that the product will be targeted for educational uses, as educators have expressed interest in it for instructional purposes.

Comparison with Existing Products:

Jobs observes that many consumer PCs in the market are slow, featuring outdated processors and low-quality displays. He mentions that most don’t have networking capabilities and have older generation I/O devices. He criticizes the design aesthetics of the existing PCs, labeling them as “ugly.”

Technical Specifications:

Jobs explains that the iMac will have a G3 processor running at 233 MHz, backed by a half-megabyte L2 backside cache, ensuring a speedy performance. It features a large, high-quality 15-inch display running at 1024 by 768 pixels. The machine comes with 32 megabytes of standard memory, expandable to 128 megabytes, a 4-gigabyte disk drive, and a 24x CD-ROM drive.

Communication and I/O Features:

The iMac is designed with various communication options, including a 100 megabit ethernet, a fast modem, and 4 megabit infrared for direct transfers from devices like digital cameras. The iMac will adopt the new generation of I/O with 12 megabit universal serial bus (USB) ports.

Design and User Experience:

Jobs highlights that the iMac features a translucent design and mentions specific elements like stereo speakers, infrared, and a CD-ROM drive located conveniently. He also praises its ergonomic mouse and keyboard, noting that the USB ports can be accessed from either side for added convenience.

Summary:

The iMac is positioned as a consumer-friendly, fast, and aesthetically pleasing computer with modern specs and functionalities, targeting both the general consumer market and educational institutions.

Product Introductions:

Speaker 00 discusses the specifications of a high-end Compaq computer featuring a Pentium II 400 MHz MMX processor, priced over $3,000 with added networking and monitor costs. Steve Jobs counters by introducing his iMac, without disclosing its price at this point.

Performance Test Setup:

Both speakers agree to conduct a performance test to compare their respective computers. The test involves running a Director 6.0 demo, with Speaker 00 representing the Compaq and Steve Jobs the iMac.

Performance Results:

Although the specifics of the test results are not disclosed, the dialogue suggests that the iMac outperforms the Compaq, given the sarcastic remark, “Do you want to put it out of its misery or let it go?” This implies that the iMac finishes the task more efficiently.

High-end Specs vs Consumer Needs:

Speaker 00 highlights the high-end specs of the Compaq, aimed at conveying its superiority. Steve Jobs counters by focusing on the actual consumer use-case, essentially challenging the notion that higher specs necessarily equate to better performance for typical consumer needs.

Cost Factor:

Speaker 00 mentions that the Compaq is priced over $3,000 when networking and monitor are included. Although the price of the iMac is not stated, the dialogue implicitly questions whether the higher cost of the Compaq justifies its performance, especially in light of the implied iMac victory in the performance test.

Consumer Choices:

The discussion highlights the contrasting philosophies of the two companies. While Speaker 00 focuses on offering the highest specs possible, Steve Jobs focuses on delivering what consumers actually need—implied to be better performance despite potentially lower specs.

This dialogue effectively serves as a critique of the “specs race” in the PC industry while bolstering the iMac’s value proposition of optimized performance for consumer needs.