For Apple, '08 ends with the Macworld clunker

By Dan Turner, Computerworld |  Business, Adobe, Apple

Until mid-December, the big news about the upcoming Macworld Expo and Conference was that Adobe Systems Inc. and Belkin International Inc. weren't going to exhibit at the big show.

Then came the bombshell from Apple Inc. that it wouldn't take part in the event after 2009 -- and CEO Steve Jobswouldn't even be on hand for his highly anticipated keynote address next week. (The show runs Jan. 5-9.)

For those of you who don't know -- and if you're reading an about the Macworld Expo, you really should -- the Expo is an annual holy site for Mac users, developers and resellers. Jobs rises to the stage to give the keynote, confirming or confounding wild rumors about fantastic new Apple products; various conference tracks get the technically curious up to speed on new Mac tech; and everyone gets to flood the show floor at San Francisco's Moscone Center to get their sticky mitts all over product, product, product. It's a weird combination of a car show, revival tent and pilgrimage.

And while IDG Expo, which puts on the event, says there'll still be a Macworld Expo in 2010, Apple's move raises serious doubts about prospects for 2011. Older hands on deck will remember that there used to be two Macworld Expos each year: the San Francisco one in January and a summer one in New York (which moved, under a cloud of controversy, from Boston). Then, five years ago, Apple pulled out of the summer Expo. At the time, it cited the cost of hauling everything and everyone to the far coast as a reason. And that may have been a valid one. After all, it was fairly redundant of the January show, and it pressured Apple to come up with something to announce on a timetable not its own.

The summer Expo Without Apple was sad. A friend who attended reported that it was mostly iPod case vendors -- and future East Coast shows were eventually cancelled.

The San Francisco show may yet escape that fate. IDG could keep it going, focusing more on Mac users, with more workshops, third-party software manufacturers, and..., well, I'm sure someone will have ideas. But at best it'll limp along, and the best plan may well be to let user groups go local, or thrive on the Internet.

Though there's been a lot of speculation about why Apple made this decision -- with guesses ranging from Jobs' health to corporate cutbacks -- nobody outside of Apple's Cupertino, Calif. headquarters knows for sure. The company has a history of brutally ending what it sees as suddenly unnecessary -- floppy drives in the iMac, FireWire and so on -- and it's usually right. It's like the sudden break-up of a long-term relationship when it becomes obvious one partner has lost interest. Brutal, cold and quick may be the right decision, but that doesn't mean it won't hurt.

Apple has said that it prefers to move away from big, once-a-year shows for product announcements, preferring its own special events. These give more flexibility on product rollouts, offer better rumor control and remove artificial pressure from the product cycles.

Still, it was fun while it lasted.

It's also worth noting that Apple's move isn't a sure sign the bottom is dropping out of the Mac market -- which used to be tied inextricably to the adjective "beleaguered" and is now pushing a 10% market share.

Paul Kent, vice presidnet of IDG World Expo and general manager for Macworld Conference and Expo, told me early this month that the 2009 show will be just as large and vibrant as those of previous years. From his standpoint, the interest of developers and software companies large and small looks fairly steady. Given the dire economic situation, Kent's "pretty happy with that."

He also pointed out there will be 500 exhibitors at next week's expo, and as many as 45,000 attendees, one of nine who will participate in at least one technical session. In fact, Kent said, Macworld Expo is one of the largest IT conferences in the country. That, of course, was before Apple's announcement. We'll know more about the effects of its pullout after the '09 show ends. And we should have a better idea then what the future looks like for Expo '10.

Whither the Mac Market?
Despite Apple's step back from the Macworld stage, the company appears to be holding its own during a time of worldwide economic uncertainty. We won't know the actual effect on Apple of the current crisis until mid-January, when the company releases its quarterly numbers. Still, from anecdotal evidence, it doesn't look like enthusiasm for most things Apple has waned.

In fact, most recent estimates show its market share among PC makers rising toward double digits, the iPod is still king of the hill, and the iPhone has in its first year leapfrogged Windows Mobile devices in the smartphone market -- despite what Steve Ballmer predicted just over a year ago. Heck, even Wal-Mart is on board, beginning iPhone sales just this past Sunday.

Of course, these are all lagging indicators (aside from Ballmer's pronouncements, which fall into their own, weird category); the apocalypse economy is more recent than all these data. But still, I think Apple will weather the downturn better than most PC companies.

That's because Apple fills an odd slot in the market. None of its products are exactly commodities, fungible boxes like the nearly generic desktops from Dell or HP, while the iPod and iPhone lines pretty much define the market for most people (maybe someone slipped President-Elect Obama a Zune, but still).

Though there's still the myth -- stress "myth" -- of the "Apple tax," even Apple's most expensive products aren't exactly luxury items. Okay, the MacBook Air, may be. But many professions still require a beefy multi-core Mac Pro. (Remember those? They're bound to get updated some day.) And more companies are turning to MacBooks, MacBook Pros and iMacs for business use.

The fact that they haven't traditionally done so in the past was seen as a weakness of Apple's. Simply put, it didn't sell computers in large numbers to corporate customers. Dell, HP and others grabbed that market and never let go; Apple aimed at mainstream consumers. Ironically, that one-time "weakness" may help shield Apple from the worst of the recession, since this crashing corporate market was never a part of the company's revenue projections.

Regardless of the economy, people who need to buy a new Mac need to buy a functional computer, and will buy it when they need it. They aren't likely to switch to a $299 commodity Windows-based PC. More than likely, the Mac market will be at least as strong as the Windows PC market in general; it'll take a hit like everyone has, but it's not sinking.

'09 Could be Fine
Even with the announcement that Jobs will skip next week's keynote, Phil Schiller, Apple's senior vice president of worldwide product marketing, must have to say something . But what? As my editor reminds me, "speculation pieces are a dime a dozen." Still... you've got to try.

There are obvious candidates for product updates in the coming year. We already know Mac OS X 10.6, Snow Leopard , is coming -- and quite likely sooner than later. Expect at least the announcement next week of a release date. And almost certainly, we'll see new Apple Cinema Displays. A 24-inch, LED-based model was unveiled in October , but the remaining displays haven't seen a refresh in ages. It's not just the timeframe that makes an update anticipated, though -- the new 24-incher moves to a more ecological LED backlight and uses the new Mini DisplayPort connector. It's a safe bet that the entire line will look like this one, and sooner rather than later. Any delay is probably due to getting manufacture of LED-backed screens up and running reliably, and in volume.

Similar production startups are probably what's keeping the 17-inch MacBook Pro from undergoing the same recent refresh as its more petite brethren. In addition to getting enough 17-inch units of the screen, the case requires a completely different design and tooling to match the machined-from-a-single-brick (and pretty awesome) cases of the 15-inchers.

The iMac family closely follows the MacBook and MacBook Pro advances; the desktop machine isn't far from an upright version of the laptop. Though machined cases may or may not be relevant, there should be processor updates and changes to the GPUs -- though since these guys run only when plugged in, there's no need for the MacBook Pro's dual GPUs.

More speculation: Intel will be bumping up its mobile processor line in the second quarter of 2009, so there could be speed increases to Apple's laptops soon after. And one quarter later, Intel's "Nehalem" (Core i7) processors will be in production. The new chip design could represent a big performance jump and better energy efficiency.

There are also a few "remember me?" products we may see more of in '09. The Mac mini? It's been an awful long time -- since 2007 -- since we've heard a peep out of that line. If recent rumors are to be believed, we could see a speed bump, a "reimagining," or even the mythical "xMac" (an expandable, almost-pro-level-but-not-quite desktop). I'd be interested to see a breakdown of how many Mac Mini owners use theirs as a second computer, a media hub or something other than as their primary box.

And as for big guns, the tower-of-power Mac Pro family didn't see much love in 2008. Has Jobs even mentioned them? The best bet for these guys would be a big boost when the server-level Nehalem chips come out in early 2009. Maybe we'll see a return of the "bakeoff" speed comparisons.

There's also plenty of speculation about the iPhone -- though mainly about when a storage bump will occur -- and some sort of "netbook." If Apple wants to make a point -- that Steve Jobs isn't essential to big news and groundbreaking products -- maybe Schiller will pull an Apple netbook out of his back pocket as his own special "one more thing."

And Macworld will get one last bit of glory before moving on into an Apple-less future.

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