Editorial: License to rock By David Leishman, dleishman@maccentral.com
Let’s look at some numbers.
Apple this week reported its quarterly earnings, and the stock market applauded the company’s revenue and profit increases over year-ago figures by raising its share price more than 10 percent.
Meanwhile, according to the Wall Street Journal, the Mac’s share of the world-wide personal computer market is now under two percent. Or, as Andy Hertzfeld, a member of the original Macintosh design team, declared at this week’s Macworld Expo, it’s ” asymptotically approaching zero.”
Back to the earnings: The iPod accounted for more than 12 percent of Apple’s revenue, slightly down from 14 percent in the prior quarter, but doing nicely. The music player isn’t displacing Macs as Apple’s flagship product, but if you figure each unit sold at about $300, Apple doesn’t show a profit without them.
And finally, Velvet Revolver’s “Contraband” CD recently went to number one on U.S. music charts.
The disc uses SunnComm’s MediaMax copy protection system to secure two versions of the music, one a straight CD-audio playable format and the other encoded in Microsoft’s WMA format. Which, of course, won’t play on an iPod, which is, of course, the number one-selling digital music player.
Not surprisingly, almost all of SunnComm’s “customer service comments…have to do with iPod compatibility,” notes the company’s CEO. A situation that has to change — for both his company and Apple.
Even Cnet, not known as an Apple booster, sees the writing on the wall. John Borland’s article notes that “the two companies responsible for most copy-protected CDs are scrambling to create new versions of their technologies that are compatible with Apple’s popular digital music player.”
Fortunately, this isn’t the Apple that in the 80s refused to license it system technologies. While the company hasn’t licensed its Fairplay digital rights management software yet, the opportunity to supplement its music-related earnings by letting CD-producers (as opposed to other music players) include it in their wares is a droolingly lucrative opportunity.
An opportunity that won’t cost a cent of development money and could cement Apple’s lead in music devices, even as it pokes a hole in Microsoft’s dreams of another monopoly. SunnComm and its chief competitor, Macrovision, are both optimistic that they can reach an agreement with Apple. Borland reports that the latter has already demonstrated iPod support to record labels.
This is great for Apple, and reflects well on its corporate strategies and follow-through. A licensing agreement could even help offset summer revenues lost by the delayed G5 iMac. As the economic mini-boom comes to a halt, Apple’s earnings report and the music-related revenues stand in sharp contrast to the slowdowns recently announced by larger companies such as Oracle and PeopleSoft. It looks like #1 with a bullet on the music charts.
Apple News
Apple reports $61 million profit
Apple on Wednesday reported a profit of $61 million or $.16 per diluted share for its fiscal third quarter ended June 26, 2004. Apple’s CEO Steve Jobs said the numbers represented the company’s “highest third quarter revenue in eight years,” and that “our Mac-based revenue grew a healthy 19 percent, and our music-based revenue grew an incredible 162 percent.” He also stated Apple’s product lines will have “some amazing new additions coming later this year.”
Apple’s quarter, by the numbers
Airport Express rounds up 80,000 pre-orders
iTunes Music Store hits 100 million song milestone
Jaguar offers limited edition black iPod
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Macworld Expo News
Macworld magazine on Wednesday announced its Best of Show awards for the Macworld Conference & Expo 2004 in Boston, Mass. The awards were given in different categories to five products that either made their public debut at Expo or were recently introduced and generated excitement on the show floor.
Macworld Expo kicks off with 20 years on the Mac
Macworld: Harman intros JBL ON Tour, JBL On Stage
Macworld: SketchUp 4 simplifies 3D sketching, modeling
Hardware News
MicroNet Technology is now shipping SANcube800, a FireWire 800-based Storage Area Network solution aimed at digital music and video professionals who need to simultaneously share resources from multiple workstations. It offers up to 1.5TB of online serverless storage, RAID 5 reliability and five hot-swappable 7200 rpm ATA-6 hard drives, with transfer rates as high as 70MB per second.
Epson intros 4MP L-410 digital camera
Xtremity Accessory Kit for iPod mini debuts
Marathon ships 6U horizontal G5 Rackmount
Bigger Disk Extreme: up to 1.6TB external storage
Giga Designs offers new G4 dual processor upgrades
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Software News
EyeTV 1.5 adds Safari support, more
Elgato has released EyeTV 1.5, an update of its video recording software that unifies support for all of the company’s digital video recorders. EyeTV 1.5 adds support for Apple’s Safari Web browser, and for TitanTV’s remote programming feature, which allows users to schedule recordings from any computer with Internet access.
Doom 3 goes gold master, Mac version on the way
REAL Software offers Office Power Pack Vol. 1
Opera’s one-click setups emulate other browsers
DV Expo: Pro Import C3 timeline app debuts
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Around the Web
Alpine’s in-car iPod interface coming in September
Gizmodo reports that Alpine has a “mostly-firm date” of “late September” for its new in-car iPod interface, the KCA-420i. The device will connect to Alpine head units that support its Ai-Net or MediaXpander technologies. (Picture included.)
MacFixIt’s Mac OS X 10.4 (Tiger) preliminary report
The Macintosh Fifty Fast Facts project
Glenn Fleishman: AirPort Express’s dangling wires
Six design lessons from the Apple Store
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