Analysis--Steve Jobs' Macworld 2004 Keynote

Yesterday, we posted a note on Steve Jobs three major announcements: G5 Xserve, GarageBand and iPod mini. But there were other interesting tidbits mentioned in his keynote address:

• This year is the 20th anniversary of the Mac, introduced by the award winning commercial "1984" during that year's Super Bowl game. Keynote attendees got a poster.
• There are now some 9-10 million active users of Mac OS X, nearly 40% of Apple's 25 million installed base. There are 10,000 OS X native applications.
• Final Cut Express Pro 2.0 was announced, $299 or $99 upgrade. It was demoed. There are some nine new features.
• Microsoft Office 2004 for Mac will be out in the spring. Word will have a new component called Notebook to take text and audio notes on your Mac. Excel has a new page layout view that shows exactly how it will print. Both were demoed.
• 30 million songs have been downloaded from iTunes Music Store and the download rate is approaching 2 million per week. It represents 70% of all legal music downloads.
• Pepsi and Apple will give away 100 million songs with 300 million bottles of Pepsi Cola, one in three will have a free song code under the cap. We intend to buy a lot of bottled Pepsi starting in February.
• There are now five applications in iLife '04 due out January 16th for $49 on a CD. iTunes 4.2 has already been available as a free download but it is not clear if any of the other upgrades will be available as a download. Both iMovie 4 and iPhoto 4 have new features. iMovie 4 will capture video from iSight and iPhoto will work with 25,000 photos. iPhoto 4 will be much faster, have smart albums, photo sharing with Rendezvous, new effects like Sepi toning and slide show capability with editing. iDVD 4 will get new themes and titles like the "Star Wars" effect. The big announcement was the new GarageBand application and its demo took the longest segment of the keynote.
• Some 730,000 iPods were sold during the fourth quarter of 2003, about 2 million since they were introduced. The iPod is 31% by units and 51% by revenue of the MP3 player market, number one. The 10 GB low end model was replaced by a 15 GB model. New "in-ear" headphones were announced for $39. The new iPod mini was released "...to capture the high end flash player market..." according to Steve Jobs.

So what do we think? If you are interested in music, especially recording your own music, the keynote was great. Most of the keynote was devoted to this topic. For those who play instruments and/or sing, the new iLife application GarageBand has got to be really terrific. When we were teenagers, around when Steve Jobs was, it seemed that there were lots of garage bands--it was a real in thing then. Today, we know few families whose kids are in such bands. But, maybe GarageBand will spark a massive re-vitilization of them.

If you only want to use an MP3 player for music that you frequently listen to and have only a moderate number of contacts and calendars, a 4-GB iPod mini is also terrific. Since we have only 178 songs on our 30-GB iPod, we would definitely get an iPod mini if in the market because of its small size and simplicity--a silver one to match our PowerBook. Many people point out that for $50 more one gets an additional 11-GB and more functionality but to us that's like paying 50 cents more for a humongous cup of softdrink that you won't drink. We think the iPod mini will be hugely popular even at $249.

If you are interested in computing other than with music, the keynote may have been a disppointment. But we think that you shouldn't let it get to you. First, Apple has had to diversify to survive as a company and it is a hit in the consumer digital music field, a huge success in this spoke of Steve Job's digital hub theme. Second, Apple no longer saves up all of its announcements for Macworld. Recently, there have been many more announcement points during the year. As quantities of faster and cooler G5s become available later this year, we will see faster Power Mac G5s with other features and G5 PowerBooks and maybe even newly-designed G5 iMacs.

We look forward to an exciting 2004. [Photos by Brian Nakamoto]