Editorial: Orange juice
By David Leishman
There’s an adage that maintains that if all you’ve got is lemons, then you capitalize on them by making and marketing lemonade. As the company’s latest financial report shows, Steve Jobs once again is turning business strategy on its head by making orange juice out of Apple.
Which is to say that his computer company sold more devices (iPods) than computers in this last quarter. And that’s a good thing, because Apple needs to leap from one successful new product introduction to the next while enhancing competency and persistent growth in all its other divisions.
Jobs’ synergistic vision seems to be driving this strategy in a uniquely compelling fashion, even if some of the divisions have to stumble for periods of time while he and Apple focus on other product lines.
Take, for example, the education division, which has certainly lost ground during his tenure. The decline started before his arrival, but Apple hasn’t taken decisive steps in this market until recently. But now a comprehensive effort is emerging that includes a methodical outreach program for bulk sales of Macs into school districts, newly revitalized and very reasonably priced G4-equipped eMacs and iBooks (one friend calls the latter “the best Mac I’ve ever owned”), and a series of non-computer products that drive all the kids wild. “I want my iPod and I wanna play with GarageBand.” Me too.
All in all, it’s not hard to understand why Apple’s education sales are up 10 percent over last year.
And, in fact, Apple appears to be doing well on several fronts, as its iPods, iLife software bundle, and laptops led a charge to
$46 million in profits
last quarter. Unfortunately, the quarterly report also reveals extremely disappointing numbers for Apple’s desktop sales, even as the PC industry is experiencing double-digit growth.
But I think that will change over the next 15 months, and that part of the structure for revitalization is already coming into view. I won’t bore you with it again, because over the last couple weeks I spent a lot of time on Apple’s new scientific/network/developer efforts, but sometime in 2006 Jobs will introduce a machine that will do for the desktops what the iPods have done for education — put a face on “love and hope and sex and dreams.”
Yes, we’re all anxious NOW for 3GHz Macs, but rumors indicate the transition to new chips isn’t going as smoothly as we and Apple had hoped. Fortunately, IBM is committed to developing the chips for its own reasons, and its track record and future road map this century are admirable.
So, although Mac fans have long been accused of “drinking the Kool-Aid,” I think it’s safe and healthy to take a deep breath and have a sip of the right stuff.
Apple reports $46 million profit
Apple on Wednesday reported a net profit of $46 million for the company’s second quarter ended March 27, 2004. In the quarter, Apple shipped 749 thousand Macintosh units and 807 thousand iPods, representing a 5 percent increase in CPU units and a 909 percent increase in iPods over the year-ago quarter. (Click
for MacCentral’s then-live report.)
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